Utility Week

UTILITY WEEK | 8TH - 14TH MARCH 2019 | 17 This week Capacity market fees voluntary during halt Deferred charges will be collected promptly and in full if and when the scheme is reinstated Energy suppliers will not be required to make capacity market payments during the ongoing standstill period, the government has announced. However, the Department for Business, Energy and Industrial Strategy (BEIS) warned that deferred charges will be collected promptly and in full if and when the scheme is reinstated. The capacity market was suspended in November a•er an EU court overturned a prior decision by the European Commission to approve the scheme under state aid rules. All payments to capacity providers and charges on suppliers were halted pending its reapproval. In a consultation published in December, BEIS put forward proposals to resume charging suppliers during the freeze to prevent a sudden spike in costs and allow quick payments to capacity providers once it comes to an end. It said the charges could either be collected by the Electricity Settlements Company (ESC) as usual, or by the Balancing and Settlement Code (BSC) administra- tor Elexon. However, the second option was dependent on a modification to the BSC, which was rejected by Ofgem at the end of February. Based on the responses to its consultation, BEIS has decided against imposing a charge on suppliers while the capacity market is out of action. It has instead opted to "mandate that supplier charges are collected and paid in full shortly a•er the standstill period ends, with robust enforcement by ESC". BEIS said suppliers will be encour- aged to make "prudent provision" in the meantime, including by making voluntary payments to the ESC. TG ELECTRICITY Council agrees £62m solar farm deal Warrington Borough Council has signed a £62 million contract with Gridserve for the con- struction of two "pioneering" subsidy-free solar farms near York and Hull. With a combined capacity of more than 60MW, they will produce enough power each year to meet 100 per cent of the council's annual needs. Both are expected to be combined with large battery storage systems. Gridserve chief executive Toddington Harper said the solar farms will be the first in the UK to feature panels mounted on horizontal pivots that automati- cally track the sun from east to west, thereby producing power more evenly throughout the day. Construction will begin shortly on the 34.7MW solar farm near York, which will have 27MW of battery storage. It is expected to be operational in October. ELECTRICITY SSE to pay out over FIT misreporting SSE overstated generation pay- ments in its feed-in tariff (FIT) annual submissions to Ofgem due to an "administrative error" and will now pay more than £705,000. The company will pay £455,705 in interest to the FIT levelisation fund and £250,000 to Ofgem's voluntary redress fund for misreporting the costs it incurred through making FIT payments to eligible low-carbon generators. As a result of the error, the supplier received £4.07 million more in payments from the annual levelisation fund than it was entitled to. SSE reported the error to Ofgem and has paid back the overpayment. It has since changed its reporting processes following an independent audit. ENERGY ENA concerned over NIC future funding The Energy Networks Association (ENA) has raised concerns over the future of innovation funding, while announcing its members have chosen to move forward with seven proposals submitted in response to a call for ideas for Ofgem's annual Network Innovation Competition (NIC). The industry body sounded the call in September and 58 proposals were submitted. The successful seven will work with network operators to bid for up to £20 million of funding for gas innovation projects and up to £70 million for electricity inno- vation projects. An ENA spokesperson said it is concerned Ofgem will pull the plug on NIC funding and warned this would have a "devastating effect" on attempts to encourage decarbonisation projects. EU: state aid decision was overturned Finance & Investment Stock watch 140 120 100 80 60 GOCOMPARE SHARE PRICE, FIVE DAY Mar 2018 GOCOMPARE SHARE PRICE, ONE YEAR GoCompare's new automated energy switching brand, Weflip, was cited as something the company's chair Peter Wood is "particularly excited" about as he increased his stake in the comparison site. The move saw its share price rise 6.8 per cent to 69p on 5 March a€er a turbulent 12 months. On 28 February, GoCompare revealed plans to invest around £10 million in marketing Weflip in 2019. 72 70 68 66 64 62 28 Feb 1 Mar 4 Mar 5 Mar pence pence Jun 2018 Sep 2018 Dec 2018 Mar 2019

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