FIRST UP, says Dorothy Thompson, donning her hard hat and steel-capped boots, we’re going to tour the power plant.
Oh great. I’m handed boots, hat and gloves — “things can get a bit grimy” — and marched off to see Europe’s biggest coal-fired power station. I’m so glad I wore my best suit.
For Thompson, chief executive of Drax and the first female boss of a quoted company in the power sector, it’s another chance to check on the working efficiency of the firm’s assets.
And they are huge: a humungous hall of cranking, shuddering, cacophonous boilers and turbines. Twelve enormous cooling towers belching steam. Fields of coal waiting to be shovelled up the conveyors. Not to mention the now-obligatory nature reserve adjacent to the vast 1,800-acre site.
Drax’s power plant provides about 7% of the UK’s electricity requirements — you wouldn’t be surprised if it provided more.
And grime covers all. “That’s the coal,” says Thompson, looking nonplussed at my discomfort. Drax, half an hour outside Doncaster, likes to call itself the cleanest and most efficient coal-fired plant in Britain. It’s also a business with remarkable powers of recovery.
Written off as a dead duck two years ago, when its American owner handed it over to creditors, it has been buffed up and turned round, and was listed on the London Stock Exchange in December. Soaring electricity prices have boosted its prospects, as will be seen this week when it reports its first set of results.
And sitting in control of it all, in her first public company top slot, is 45-year-old Thompson. With her trim Margaret Howell suits, pulled-back brown hair, cut-glass voice and demurely elegant good looks — no make-up, little jewellery — she is not quite what you expect up here on Planet Yorkie-bloke.
Add in the fact that she lives in London’s Islington, works from a flat in York half the week and admits she knows little about engineering, and you might wonder, what is going on? Thompson, it turns out, is a financial brainbox, trained as an economist and with a background in project finance — one of the new breed of bosses who know that the market for power is as much about trading as production.
Hence phrases trip off her tongue like “We do not intend to forward hedge all our volume, we intend to remain in a position where we can exploit our optionality relative to the market”.
Ah, right. And she ran gas-fired power stations for Intergen, the international electricity generating company, before Drax’s chairman, Gordon Horsfield, recruited her last year. Perhaps the more appropriate question might be, what does she know about coal? “The hardest part of my job is the engineering,” she nods. “I don’t fully understand it. I have to find the people who bring out the commercial implications.”
By now we are back in soft shoes, sitting at the boardroom table in Drax’s Soviet-style administration block. Thompson is picking thoughtfully at canapés, looking like a boffiny senior librarian. When I ask what is the hardest part of heading a public company, she gives my tape recorder a pointed glance and says: “This.”
But the press is something she will have to get used to. Former colleagues tip her as a future FTSE 100 star — Drax is just outside with a market value of £2.6 billion — and cite her brains, bravery and toughness.
Right now, however, she has to plot a course for Drax through the government’s imminent energy review — due in September — and the consolidation that may follow.
Drax has many strengths: it has cut its debts to a reasonable level, it has fitted its plant with anti-pollution systems, it is unusually flexible in its output, it is keen to incorporate more biomass in its fuel (currently 2.5% of total) and — alongside gas and nuclear plants — it offers Britain diversity.
But as a company it is small compared with the vertically integrated power groups and others. It rebuffed three bids last year before listing. Will it buy to build, or just get bought? Thompson purses her lips. “Our first objective is to get Drax to the right point, both in terms of how we trade and how we maintain the plant and invest in it,” she says.
“But this is a dynamic industry. The backdrop of where we sit changes constantly. We have told shareholders we will remain sensitive to opportunities, which could be a good enhancement, or we could just get bought by others. It is about value.”
Her biggest problem may be working out just what to spend on the Drax plant itself. Originally built in the late 1960s to burn coal from the nearby Selby coalfield — now closed — it is its own bottomless pit for investment. Thompson compares it with the NHS.
“It’s almost infinite what you can spend on it, so it’s about finding the right balance and places, and that is all down to the quality of communication.”
This is all a long way from where Thompson started, working on overseas development projects in Africa and Asia.
Back then she was escaping “a very conventional upbringing”. The youngest of six — “my mother was a Philadelphia Catholic, my father was an English engineer” — Thompson was born Dorothy Carrington and attended an all-girls convent in Dorset. She excelled at maths and went on to study econometrics and mathematical economics at the London School of Economics.
A City career beckoned. “But I’m not a backroom person,” she says, and a trip to India had opened up possibilities for her. So she left a first job at American Express for a fellowship that placed her in the National Development Bank of Botswana for two years. From there she joined CDC (Commonwealth Development Corporation), the private-sector arm of the British government’s aid programme.
Running teams assessing the viability of investment options overseas became her passion. “That’s when I got into power because CDC financed some of the first really independent power projects.”
In 1993 she made the crucial jump, using that experience to join Powergen’s international arm, developing power stations in Portugal, Indonesia, Australia and India. Later she moved to Intergen.
“I just needed to earn more money,” she says of her decision to quit CDC, “because my husband Christopher was setting up a newsletter company”.
That streak of pragmatism is a dominant trait now. Thompson shuttles up and down from London, spending three days a week at Drax’s plant, and two in the City, dealing with investors and government.
On the home front, she has two children, 15 and 10, both at boarding school. She cites hiking as her favourite pastime.
Those who work with her say she is quietly effective. “She’s thoughtful, she’s got drive and she gets things done,” says Horsfield, before adding: “We didn’t want a ‘has-been’, we wanted a ‘will-be’.”
Former colleague John Proctor, Intergen UK’s operations director, backs that up. “She is destined for bigger and better. She has a strong intellect, she’s elegant, she nurtures staff and is tough as steel underneath.”
Just occasionally that steeliness can glint. At one point, when I ask about project financing, she snaps poshly: “You really don’t know much about this, do you?” Er, no. But then she laughs — only teasing. She may need that humour in the months ahead as the government sorts out its policy on carbon, coal, biomass, nuclear and a host of other things.
For now, she just wants to be left to get on with her job. You suspect, however, that it will be hard to do that unnoticed.
Dorothy Thompson's working day
THE Drax chief executive wakes at her flat in York at 6.30am. After coffee and toast, and some quick replying to e-mails, Dorothy Thompson drives to the Drax site.
“I don’t have a routine day. I read the market report first, then go into a series of meetings. Only a few are regular, like the 2pm trading meeting.”
She spends part of her time dealing with trading, the rest overseeing the plant — issues can range from “the large combustion plant directive” to planning a painting competition to decorate Drax’s drab corridors.
She usually spends Thursday to Sunday in London, where she lives with her husband in Islington. She meets investors, customers, regulators and government officials.
At Drax, she finishes by 7.30 and goes to the gym. Her mother, who lives near Leeds, often visits to cook supper.
Thompson's tips for the top
- Good communication is essential if you are to gain the confidence and respect of those who matter. Companies often focus on image and forget the personal aspect of the art of communication.
- An open and honest culture delivers loyalty and underpins performance. Inspiring people to give their best can be achieved only through integrity at work.
- Good health and safety management is essential in the industrial and construction sectors. It requires a high level of care for staff with acute attention to detail.
- Overcomplexity creates problems.
Vital statistics
Born: November 18, 1960
Marital status: married with two children
School: St Mary’s, Shaftesbury
University: London School of Economics
Salary package: £350,000 plus bonus
Homes: Islington and York
Car: Green Lexus
Favourite book: The English Patient, by Michael Ondaatje
Favourite music: Gorillaz
Favourite film: Breakfast at Tiffany’s
Favourite gadget: i-River
Last holiday: Switzerland
Interests: hiking, skiing, sailing, scuba diving
