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Capacity Auction Successful for Storage

The recent Capacity Auction for delivery 2020/21 was successful for new storage solutions but less successful for new CCGT gas plants. Provisional results show that the clearing price was £22.50 kW/year for a total of 52.43 GW of de-rated capacity. The National Grid report indicates that 75% of capacity entered in the auction were awarded capacity agreements.

Source – National Grid Chart Represents – Breakdown of Awarded 52.43 GW Capacity for 2020/21

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As can be seen in the chart above, 3.4 GW of new build generation was awarded capacity contracts . This included 500 MW of battery storage, a positive signal for the development of the technology in the UK, but only one new build CCGT (combined cycle gas turbine) secured a contract, with capacity of 333 MW.

Existing CCGT plants were successful at auction, achieving the greatest volume of capacity agreements by technology, at 22.5 GW. Storage won 3.2 GW of capacity overall, 23% higher than the previous auction round held in June this year. (more…)

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Changing Generation Expected to Impact Network Capacity

As electricity generation patterns change across the UK, possible network capacity deficits across the transmission system have been identified by National Grid in its Electricity Ten Year Statement (ETYS). The outlook report predicts higher flows of electricity from the periphery of the network as more nuclear and renewable generation comes online, while coal generation simultaneously declines. Wind generation is expected to grow at unprecedented levels, particularly in Scotland where 5.6 GW of onshore wind is currently in operation and 2.2 GW is awaiting construction. Offshore wind capacity presently stands at just 190 MW, but a further 4.1 GW has planning permission, which will result in increased flows from Scotland to the south, but conversely, when wind speeds are low, increased network capacity will be required from south to north to supply Scotland.

The development of transmission-connected battery storage would be an important tool in easing the requirement for cross-country transmission of power. Under National Grid’s Future Energy Scenario, which considers different paths for the energy future, its “Consumer Power” scenario sees battery storage of 18.3 GW being in place by 2040.

(more…)

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Capacity Market Update

The Capacity Market is a mechanism that forms part of the Government’s Electricity Market Reforms (EMR) package and was introduced with the purpose of ensuring there is enough electricity to meet demand when the system is “under stress”. The Capacity Market procures a commitment from generators to provide additional generation capacity, up to four years in advance, which can be called upon to meet demand when capacity is tight. The mechanism uses a range of generation plants, as well as storage, interconnector capacity, and demand side response (DSR). Under DSR, large energy users are paid to reduce their consumption.

National Grid says that the goal of EMR is “to ensure adequate capacity within an electricity system that in future will rely increasingly on intermittent wind and inflexible nuclear generation”. This is in addition to the ongoing closure of coal-fired plants as a result of low-carbon policies.

(more…)

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