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Npower is expected to grow its business retail division in 2013 and make efficiency savings, owner RWE said at its financial results presentation today.

On the generation side, Markinch biomass CHP plant in Fife is due to open later this year, bringing online 46MW of electricity and 88MW of heat as steam for a paper mill. That will be followed by Gwynt y Mor offshore windfarm towards the end of 2014, with installed capacity of 576MW.

The UK retail business saw higher gas sales volumes and efficiency savings in 2012, as well as a domestic price rise of 9 per cent. Along with generation boosted by Pembroke gas power plant coming online in September, this contributed to growth of 25 per cent in RWE Npower’s operating result to £390 million.

The group has restructured to bring together all its generation in Western Europe under RWE Generation, leaving Npower focused on retail.

With conventional generation under significant earnings pressure, RWE plans to focus on distributed energy and energy services. CEO Peter Terium ruled out investment in large-scale projects such as new nuclear, saying it was too risky, following the company’s sale of its stake in Horizon.