Utility Week

UTILITY WEEK | 12TH - 18TH JANUARY 2018 | 11 Policy & Regulation This week BEIS reveals unabated coal phase-out plan Unabated coal plants to be excluded from capa- city market auctions from late 2021/22 The most heavily emitting coal plants will be barred from bid- ding in auctions for procuring back-up power generation capa- city, according to new govern- ment plans for phasing out the fuel by 2025. The Department for Business, Energy and Industrial Strat- egy (BEIS) said unabated coal plants, which have not been fitted with measures to limit their CO2 emissions, will be excluded from participating in the four and one-year-ahead capacity market auctions for 2025/26 and beyond, which are due to be held from late 2021 or early 2022. The move is outlined in a document that sets out how the government plans to implement prime minister Theresa May's pledge that unabated coal plants will be phased out from 2025. The document also sets a cap on emissions, with which coal plants will be required to comply to remain open aer 2025. It states the emissions intensity limit will be 450g of CO2 per kilowatt-hour generated. This limit is in line with the emissions intensity of unabated gas generators, and also the existing Emissions Perfor- mance Standard for new-build fossil fuel plants. The emissions intensity limit will apply from October 2025 to all 300MW-plus plants burning solid fuel, such as coal and lignite. The limit will be applied on a unit-by-unit basis, enabling generators to introduce measures to limit CO2, such as the conversions of coal-fired plant to biomass at the Drax station in Yorkshire. DB EMISSIONS BEIS cuts projection for greenhouse gas The Department for Business, Energy and Industrial Strategy (BEIS) has lowered its projection for greenhouse gas emissions during the fourth and fih carbon budgets. The government attributed the fall to revised data and assumptions, including new figures on energy demand and temperatures during 2016 and increased estimates for future fossil fuel prices. Accounting for the impact of existing, new and proposed poli- cies, greenhouse gas emissions are now expected to total the equivalent of 2,014 megatonnes (Mt) of carbon dioxide during the fourth carbon budget (2023- 27). The figure is 52Mt lower than last year's prediction of 2,066Mt, but still exceeds the 1,950Mt budget by more than 3 per cent. Emissions during the fih carbon budget (2028-32) are on course to total 1,841Mt – down 51Mt on the previous projection. The 1,725Mt budget is expected to be breached by nearly 7 per cent. WATER Ofwat appointment as Fletcher clocks in Ofwat has announced the appointment of Alena Kozakova as senior director of analytics and chief economist. Kozakova originally joined the water regulator as chief economist in 2016 and her new role will see her responsibilities widened to include leading the assurance process for Ofwat's forthcoming price review, PR19. An "expert in competition and regulator economics", Kozakova has previously worked for Frontier Economics, the Competition Commission, the Office of Fair Trading, and the European Commission's Directo- rate General for Competition. The news of her expanded role came on 8 January, the day Rachel Fletcher joined as the regulator's new chief executive. Fletcher joins from Ofgem, where she was senior partner for consumers and competition. PAN-UTILITY NIC chair quits as government adviser The government's infrastructure tsar has quit following a disagree- ment with Theresa May over the thrust of her policy on Brexit. Lord Adonis, who has chaired the National Infrastructure Com- mission (NIC) since its establish- ment in 2015, has quit the post to campaign against the way the prime minister is handling the UK's withdrawal from the EU. In his resignation letter, he said he wanted greater freedom to criticise the government over its plans to quit the EU single market and customs union. Steaming ahead: plans to phase out coal Political Agenda David Blackman "Clark remains in BEIS pole, but his sway is diminished" Greg Clark may have survived as secretary of state for business and energy, but his position looks a lot more embattled than it did before this week's Cabinet reshuffle. Clark will have had a nervous weekend, having been identified as lined up for the chop in Mon- day's shake-up. "Dead wood" was how the Tunbridge Wells MP was described by a White- hall source in one newspaper. Clark is clearly a thoughtful individual, but at times has had has been given a leg-up with the announcement she will be attending Cabinet meetings. The bigger picture, though, is that BEIS's two key policy hit- ters, both of whom are commit- ted to the shi to a low-carbon economy, remain in place. And the elevation of Perry, a strong advocate of action to tackle climate change, looks like it is designed to send a message to environmentally conscious voters that the government takes the issue seriously. trouble articulating his message in the broadcast studios. His admission during a TV interview that he had never switched energy suppliers has given the minister a detached air when discussing the bread and butter issue of utility price caps. Others complain he has dith- ered. Utilities would endorse that aer long waits for progress on issues such as the Clean Growth Strategy, which took nearly a year and a half to emerge. But while Clark may remain in pole position at BEIS, his sway there looks diminished following a promotion for his minister of state Claire Perry. While Perry retains that rank, her profile

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