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Utility Week 28th November 2014

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26 | 28th November - 4th December 2014 | UtILItY WeeK Markets & Trading This week UK wholesale power market 'opening up' ofgem's new trading rules said to be helping to open up market to smaller independent suppliers Ofgem's new trading rules have helped to open up the wholesale power market to smaller inde- pendent suppliers, according to feedback from market players. The regulator met with market participants last Thursday to dis- cuss the impact of its new trading regulations, and Utility Week understands there was "broad consensus" that the sup- plier market access rules have proved successful so far. Ofgem's trading rules were implemented in April this year in a bid to "break the stranglehold of the big six", and include licence conditions which compel the larger suppliers, including generators Drax and GDF Suez, to offer a reasonable chance to smaller players to access trade agreements at a reasonable price. "There has been success in agreeing new contracts which might not have happened otherwise," one attendee to the session told Utility Week. "And the larger players have realised that it's not too much to ask," he added. Ofgem's interim associate partner for wholesale market performance, Philippa Pickford, said overall, the reforms seem to have had a clear benefit for smaller players who previously struggled to access the market. "Feedback from independent suppliers also shows that they have found it easier to access products since our reforms have been introduced," she said. However, Ofgem's rules targeting market liquidity continue to divide opinion, with many players arguing that the mandatory trading windows implemented by Ofgem have sapped trading volumes over the rest of the trading day. JA eLectrIcItY Green light given to EDF nuclear restarts The Office for Nuclear Regula- tion (ONR) has given EDF the all-clear to return its Hartlepool and Heysham 1 nuclear plants to service following a three-month shutdown over safety concerns. The discovery of a crack in the boiler spine of Heysham 1 in August this year led EDF to remove all reactors of a similar design as a precaution, but the regulator said last Friday that it is "satisfied" that the company has demonstrated the safety of the reactors. All three of the reactors are currently undergoing normal pre-restart checks and are expected to return to service within the week, EDF said in a statement. "The first two units are expected to come back online over the coming days and Hartlepool Unit 1 will follow on from November 26." EDF is required to issue the regulator with a separate safety justification for the return of the directly affected Heysham 1-1 unit which, pending the ONR's approval, is expected to return by the end of the year. Although the timely return of the units will help to ease tighter than expected supply margins for the coming winter, EDF has previously said they will operate only at 75-80 per cent of their maximum capacity. UK power traders told Utility Week that the news had little impact on the market because the returns were expected. eNvIroNmeNt Linking emissions trading 'difficult' UK energy minister Amber Rudd has warned that the process of linking emissions trading systems globally will be difficult to achieve and will require countries to show ambition in bridging differences between the different regional schemes. Speaking before the Energy and Climate Change select com- mittee, Rudd said the European Union would need to be as "flex- ible as possible" to create links between its Emissions Trading System (ETS) and emerging trading schemes in the rest of the world. "Sometimes it will feel like we're trying to link apples with pears, but we've got to try to be ambitious and try to find a com- mon unit," Rudd said. "It will be difficult to achieve," she added, "and we will need to consider very carefully the legal position- ing and accountability of differ- ent types of [carbon] credits." Rudd said one of the ways the EU should avoid the pitfalls of linking different emissions trading systems is by holding up the ETS as a common example "of a system that works and can be reformed". Dividing opinion: mandatory trading windows Tricks of the trade Jillian Ambrose "Traders hardly raised an eyebrow over Peterhead fail" The UK has had its share of outages this year, but the latest plant failure to garner headlines was – in many ways – the least surprising. The greater surprise surrounding Peterhead's recent supplemental balancing reserve (SBR) test failure is perhaps that SSE's ageing plant was picked by National Grid for this winter's security of supply reserve bench in the first place. Following news that Peterhead's performance test it a natural shoo-in to meet peak demand from its position close to the UK's energy demand centre. The fact that the contract might save the plant from an early closure might have been another good reason to call it up. When questioned, National Grid said only that Peterhead offered "a competitive eco- nomic assessment" compared with other units. Here's hoping it doesn't prove to be a false economy. spluttered to a halt before it could prove its readiness to save us all from the darkness, traders hardly raised an eyebrow. It's old. It's unreliable. It's in the wrong place. Why choose an ageing plant, based far from the UK's demand centres and connected to the wider grid via constrained transmission links? It's much like choosing a 1982 Datsun Cherry as a getaway vehicle. The real surprise when the SBR contracts were announced was the absence of the Barking coal-fired plant in the line-up. The 1GW plant is an East London teenager to Peterhead's Scottish Bridget Jones, making

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