Utility Week - authoritative, impartial and essential reading for senior people within utilities, regulators and government
Issue link: https://fhpublishing.uberflip.com/i/740112
UTILITY WEEK | 21ST - 27TH OCTOBER 2016 | 29 Markets & Trading COAL POWER PLANT CLOSURES Site Owner Capacity Age MtCO2 in 2014 CO2 share in 2014 Status Capacity market Ratcliffe E.On UK 2,000 48 9.22 1.8% No plans to close No Drax units 4-6 Drax Power 1,935 30 16.60 3.2% No plans to close No Cottam EDF Energy 2,008 47 8.85 1.7% No plans to close No West Burton EDF Energy 2,012 49 9.21 1.8% No plans to close No Eggborough Eggborough Power 1,960 49 7.80 1.5% Planning partial closure Yes (775MW) Rugeley ENGIE 1,006 44 4.55 0.9% Closed No Lynemouth Lynemouth Power 420 44 2.72 0.5% Planning to convert to biomass No Aberthaw B RWE Npower 1,586 45 6.04 1.2% Planning partial closure No Longannet Scottish Power 2,260 46 9.19 1.8% Closed No Ferrybridge C SSE 980 50 6.04 1.2% Closed No Fiddlers Ferry SSE 1,961 45 6.86 1.3% Not clear Yes (1 of 4 units) Kilroot AES 520 35 2.15 0.4% No plans to close No Uskmouth SIMEC 363 57 0.30 0.1% Not clear No The current carbon price cap, introduced under George Osborne's chancellorship in 2014, set a cap on the carbon price floor of £18 per tonne above the EU ETS price between 2016 and 2020. If this changed, Jones says coal would "quickly step back into becoming baseload rather than peaking plant" and this would result in a "terrible step back for the UK's carbon emissions" because it would displace lower carbon generation. "This would undo all the good work the UK has done by push- ing out coal." The government is, however, unlikely to cut or remove the carbon price floor, even though it adds costs to UK industry over and above those of the EU Emissions Trading System – which remain relatively low. To do so would be to damage the UK's high-held environmental credibility. Coupled with this, a number of coal plants have closed this year (see table), while others are mothballed. While these could be brought back online, the economics would need to stack up for their owners. This would either require wholesale price spikes – potentially as a result of another station or stations tripping and dropping offline – or as high- lighted above, a fundamental change to their economics. Unless Hammond does roll back the car- bon price floor, winter 2016/17 could prove to be coal's last hurrah as it slips off the sys- tem and we move into the post-coal era of electricity. SHARE OF GENERATION (%) Source: EnAppSys GENERATION CAPACITY FOR WINTER 2016/17 (GW) Source: National Grid EU ETS CARBON PRICES. FORWARD MONTH PRICES, € PER ALLOWANCE Source: www.theice.com 60% 50% 40% 30% 20% 10% 0% 90 80 70 60 50 40 30 20 10 0 30 20 25 20 15 10 5 0 Q3 2008 Q3 2009 Q3 2010 Q3 2011 Q3 2012 Q3 2013 Q3 2014 Q3 2015 Q3 2016 Generation capacity Nuclear Renewables Imports Gas Coal Interconnector import capacity Pumped storage CCGT OCGT Biomass Coal Wind Hydro Nuclear Jan 2006 Jan 2007 Jan 2008 Jan 2009 Jan 2010 Jan 2011 Jan 2012 Jan 2013