UK electricity capacity auction sees 2.6GW of new-build plant successful

The UK’s first electricity capacity auction will see just 2.6GW of new power plants constructed for delivery in winter 2018/19, while 6.8GW of prospective new-build generation missed out on a contract, according to provisional results published early on Friday morning.

According to the Department of Energy and Climate Change documents, new-build generating units made up the largest group of capacity that exited the auction above the clearing price by classification type. By comparison, 5.9GW of existing plants missed out.

The auction cleared at £19.40 (€24.75)/MWh, with 49.3GW of capacity bidding in successfully. A total of 65GW entered the auction, therefore 15.7GW was unsuccessful.

Plants that are to be refurbished by 2018\19 accounted for 12.9GW of successful bidders.

Of the awarded capacity, combined-cycle gas turbines accounted for the largest share with 22.3GW, followed by coal/biomass with 9.2GW, then nuclear with 7.8GW. Demand-side response accounted for just 174MW.

The vast majority, or 89%, of successful plants were awarded one-year contracts, with 3GW awarded three-year deals. The longest duration available, 15 years, went to 2.4GW of plant.

EDF Energy’s 16-unit-strong nuclear fleet was unanimously successful in its bidding, with 10 of the units set to receive refurbishing contracts.

The results are provisional at this stage, with final results set to be released eight working days later, meaning they will be released on Monday 5 January. Jamie Stewart