-
· Capacity
market auction results today shows continued
Government support for fossil generation
-
· Three-quarters
of power secured in auction is gas, nearly two per cent is
diesel, and nearly eight per cent is coal
-
· Under
six per cent is renewable and less than two per cent is
storage
-
· Government
policy elsewhere effectively blocks new renewable power projects
to market
The provisional results of the T-1 Capacity Market Auction,
released today by National Grid, show that the overwhelming
majority of back-up power generation capacity secured is from
fossil sources.
Such support for fossil sources comes as the Government has
confirmed that there will be no new funding for renewables
projects under the Levy Control Framework beyond 2021 and no new
proposals have been introduced to give clarity around how the
future renewable power market might be structured in the
Framework’s wake. Clarity around how renewable heat deployment
will be supported beyond 2021 has also not been offered.
The Government maintains a de-facto ban on onshore wind,
large-scale solar and biomass deployment by not funding “Pot 1”
of the Contracts-for-Difference auctions and ending Feed in
Tariffs for smaller generation. This, in addition to other cuts
recent to the renewable energy sector since 2015, have resulted
in a 56% decline in investment in 2017 compared to 2016 according
to Bloomberg New Energy Finance analysis.
Innovative storage projects, the likes of which the Government
has committed to supporting through the Faraday Challenge, were
directly hit in this auction as a result of recent “de-rating”
decision which reduced their competitiveness after the auction
process had started.
James Court, Head of Policy and External Affairs at the Renewable
Energy Association said:
“This is another example of Government subsiding fossil fuels
whilst blocking the cheapest renewables to market.
“The Government has confirmed that there will be no new
spending on renewable power beyond 2021 and there is a
significant lack of clarity around the future of renewable heat
and transport fuels. No long-term carbon price has been assigned,
yet the Government is happy to directly financially support gas
and diesel projects. That funding can be better used to drive
innovation in the wide range of storage technologies
instead.
“The clean growth plan talked a good game, but failed to walk
the walk. We are in the bizarre situation where we are propping
up fossil generation, but scaling back support for technologies
that are cheaper, cleaner and will provide future proofed jobs.
The government’s energy policy needs a complete rethink or we
will be left behind with a dirty, antiquated and expensive energy
system.”
—ENDS—
Notes to editors
-
· National
Grid as Delivery Body has confirmed the T-1 Capacity Market
Auction (for capacity to be delivered in 2018/19) provisional
auction results.
- · The
unconfirmed clearing price is £6/ kW/ Year for those projects
successful in the auction.
- · The
auction cleared in Round 14, on Thursday (01/02/18) with around
10GW of capacity bidding into the auction, and BEIS seeking to
procure around 6GW.
Around 100MW of storage projects received contracts, while around
700MW worth of capacity pre-qualified for the auction, but less
storage projects (1.7% of the total successful) received
contracts compared to the previous (T-4) auction for the same
year (5.6% success rate), which illustrates the competitive
nature of the auction but also potentially the impact of new
lower ‘de-rating factors’ for storage projects bidding in the T-1
auction.
- · The
results are not yet confirmed by the independent auction auditor
therefore details may be subject to change.
