Power failure that leaves a village under giant shadow

The village of Camblesforth, after years in the shadow of the six giant cooling towers of western Europe's biggest coal-fired power station, is facing the possibility of life without its neighbour.

Local people have developed a curious social and economic relationship with the 30-year-old Drax plant, which is now threatened by the crisis in Britain's electricity generating industry after losing its biggest customer.

Five hundred people work at the North Yorkshire plant near Selby while related businesses have sprung up around it. These range from an eel-breeding business that uses the plant's surplus warm water to the transport companies taking away Drax by-products such as gypsum for use in the building industry.

John Grogan, the Selby MP, was among those seeking reassurances yesterday over the crisis, which has already seen British Energy haul up the white flag and has now plunged the power supplier TXU Europe, which receives 60 per cent of Drax's output, into administration.

"The news will cause great concern for the workforce at Drax, who could lose their livelihoods," said Vince Cable, the Liberal Democrat trade and industry spokesman.

The crisis stems from the privatisation of the electricity generating industry in the 1990s.

The industry was sold as a duopoly – National Power and Powergen – that exercised considerable market power over prices. It was a highly profitable business, so other firms entered the market and built more power plants. The result was a 22 per cent oversupply of electricity and a 40 per cent reduction in prices paid by distributors to generators in the past four years.

British Energy, which generates a fifth of the country's electricity, was the first to go and TXU has inevitably followed. Last week, it failed to reach agreement over claims for more than £700m in default payments with Drax, forcing the plant to end the contract.

There seems to be little national sympathy for the idea of supporting Drax in the same way that coal mining, this region's other beleaguered heavy industry, has been aided. Camblesforth cannot expect much help. Last Friday, the Government's bail-out of British Energy was successfully challenged in the High Court by Greenpeace.

One by one, North Yorkshire's old economic props seem to be collapsing. A few years ago, Selby colliery, 10 miles away, was providing coal for Drax but it is due to close in 2004.

At the Croft housing estate, built to house power plant workers in the 1970s, the local convenience store proprietor said the Selby pit's demise would hasten that of Drax. Keith Duggan, who worked the Selby mine for 26 years, said: "While Selby was open, Drax was needed to provide a market for its coal. Now it's going, there's no reason for the politicians to care about Drax."

The Rev Margaret Cundiff, of St James-in-Selby church in Camblesforth, said: "There are a lot of Selby coalmen here too and that's what worries me."

Salvation for Drax may lie in burning petroleum coke, which is cheaper. An American oil-based residue, it was tested at Drax in the late 1990s and is dreaded by villagers who regard it as a "dirty fuel" because of its heavy nickel content.

The issue is shattering old harmonies. Ms Cundiff warned: "If they're in this economic state I fear they'll have to cut corners on safety. There are children here. Lots and lots of children."