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UTILITY Week 23rd October

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Markets & Trading 28 | 23RD - 29TH OCTOBER 2015 | UTILITY WEEK This week SSE to return 735MW gas plant for winter Keadby to return to service after months of work to bring the plant out of "deep mothballing" SSE plans to return its 735MW Keadby gas-fired power plant to the market by December this year to contribute to the UK's dwindling supply margins over the colder months. The Lincolnshire-based power plant will return to service within three weeks to start commercial operations in early December aer months of work from the Scottish utility to bring the plant out of "deep mothballing". The decision comes just days aer National Grid confirmed concerns that the UK power system will be the tightest it has been for the past eight years, and may need to rely on reserve supply to avoid blackouts. "Government and National Grid have more capacity with which to power people's homes this winter," said SSE managing director of generation Paul Smith, adding that the station has undergone extensive upgrades so it can operate with improved flexibility in the market. SSE is poised to shut down its 1GW Ferrybridge and 0.5GW Fiddler's Ferry coal-fired assets in less than six months, but secured a contract for Keadby in last year's capacity auction to deliver power in winter 2018/19. Keadby was removed from the market in March 2013 due to adverse market conditions. SSE says the decision to return the plant reflects the wider "coal to gas switch" currently shaping the electricity market following changing policies and market conditions. The station will begin its return to service from 9 November, with full commercial availability expected by mid-December. JA ELECTRICITY DSR is 'not a no- consequence option' The emergence of energy stor- age and demand-side response (DSR) measures could bring unintended social and envi- ronmental impacts, SP Energy Networks has warned. The company's chief execu- tive Frank Mitchell told del- egates at Utility Week Congress that the full impact of battery storage technology and demand- side energy management has not been considered. "It's not a no-consequence option," he warned. Battery storage, a burgeoning market, is still "15 years away" from achieving the scale needed to play a vital role in balancing the UK's demand with its dwindling supply, and when it does reach scale it could have unintended environmental consequences because only 2-4 per cent can be recycled. DSR, meanwhile, could lead some companies to realise that it may be more lucrative to be less productive, which could lead to widespread job losses and a stifling of industry. "We need to find affordable long-term solutions. And this won't need a radical departure from the current policy frame- work," Mitchell told the Congress. Rather, he argued that the government should drive forward its ambitions in terms of energy efficiency, where he said the UK is "only scratching the surface". ELECTRICITY UK imports recover after falling to 2 per cent of energy mix Power imports into the UK have recovered following outages and a French cold snap which drove their share to just 2 per cent of the total generation mix. The IFA interconnector between the UK and France is back to 2GW capacity aer main- tenance brought its capacity down to 1GW at the beginning of the month, according to power analyst Abigail Beall. Additionally, she said, colder weather in France last week caused price spikes, meaning between 7am and 7pm CET on 14 to 16 October, the IFA was exporting from the UK to France. Speaking to Utility Week on 19 October, Beall said: "The IFA has been exporting again for two hours this morning and from the scheduled commercial exchanges it looks like it's going to be exporting a little bit today again, but by tomorrow it will be back to imports. "It is now back to 2GW capa- city and has been since Saturday morning." Electricity coming into the UK via interconnectors averaged 12 per cent of UK generation between January and September this year. Keadby: removed from the market in March 2013 Tricks of the trade Jillian Ambrose "Increased renewables are denting the power price" The renewable energy lobby would have you believe that they are more spinned against than spinning. But as govern- ment crackdowns on renewable subsidies have come hard and fast, so too have the increasingly hysterical claims from those who try to oppose them. The latest in line is Good Energy, which this week sought to "balance the debate" over renewable energy costs by pointing to its impact on the wholesale power price. able energy and as a result nega- tive wholesale pricing and some of the highest bills in the EU. Aer a series of ever more confusing emails with the Good Energy team, my only conclu- sion is that this particular effort has not increased the transpar- ency of the debate. The report may well prove that subsidy costs have climbed less than wholesale costs have fallen, but I'm not about to thank wind turbines for the global commodity slump. There's no denying that increased renewables in the UK energy market are denting the power price. Particularly windy days will see spot prices plunge while an increased reliance on fossil fuels when wind speeds wane has the opposite effect. But to argue that renewables are having a "positive net impact" on consumer bills as a result of this is at once both laughable and frustrating. The money supporting renewables might not come from the market, but it still hits consumers in the pocket. A quick look at the German market proves the point: some of the highest deployment of renew-

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