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UK Capacity Market analysis

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UK Capacity Market analysis

“The auction has delivered good results this year, moving slightly away from coal towards battery and gas peaking plant.  Small gas peaking gas is arguably more useful than baseload CCGT as we transition to more wind and solar: it provides cheaper capacity (proved by it undercutting CCGT), more locally, and provides reliable peaking power without the risk of running gas baseload, which would undermine our future climate targets.  We ask the Government to lay out how they see gas emissions going forward, as we build more gas plant. 

The government acted to avert a huge influx of diesel, which is great; these proposals are however work-in-progress, and still need to be implemented.

Further changes need to be made to the capacity auction.  First, to ensure coal phases out by 2025 without a large cliff-edge – they received £128m from this auction alone, so would be in no hurry to close.  Second, to further encourage battery technology, which will be increasingly important in the transition as the technology develops.”

Dave Jones – Analyst at Sandbag

Skills

Posted on

December 9, 2016