The capacity market clearing price was confirmed on Friday by delivery body EMR at £6.95/KW, the lowest ever reached in a Capacity Market Auction, which guaranteed £378.3m in revenue to UK power generators.
A combined capacity of 59.28GW entered the auction, with 91.82% receiving Capacity Agreements for delivery next winter. The majority of the 54.4GW procured was picked up by existing gas power stations, who received £153m in guaranteed payments. Coal fired or coal and biomass generation plants secured 19% of the auction, a total of 10.5GW and £73m in revenue. This included the Eggborough coal-fired power station plant, which was set to close in March 2017. The plant will now remain open until March 2018; potentially remaining open until 2023 if more contracts are won.
EDF were the largest party winning contracts and were had 12.6GW of capacity, including 100% of its 7.9GW of nuclear capacity winning a contract. Capacity secured by the “Big Six” totalled 64% of contracts awarded in the auction. A breakdown of capacity by party is displayed below.
|Scottish Power||2.2GW (4%)|
Industry officials criticised the results for not encouraging green projects. With 96.4% awarded to existing generation and interconnectors, commentators expressed dissatisfaction as battery storage won just over 10MW of combined capacity, significantly lower than the 500MW in the previous auction.
Results will be provisional until 15 February, with the Secretary of State deciding whether the auction results will stand before allowing National Grid to publish the final auction results. If approved, providers will be expected to deliver their obligation during times of system stress from October 2017.
Source: The Energyst