Renewables continue to grow share of UK power generation

renewables generalDuring the first three months of 2016, the share of the country’s power generated by renewable sources continued to grow, with the combined output from wind, solar, hydro and biomass registering the second highest level of electricity production behind gas.

The figures are included in the latest quarterly market report* by energy specialists EnAppSys, which illustrates the continuing demise of coal fired power stations from their once dominant role in Britain’s power generation sector.

Overall, in the first quarter of 2016 gas (CCGT) provided 35.4% of the country’s electricity at 29.68TWh (13.7GW). This was followed by: –

  • Renewables at 22.4% which generated 18.78TWh (8.7GW)
  • Nuclear at 19% and generating 15.98TWh (7.5GW)
  • Coal at 16.2% generating 13.56TWh (6.3GW) and
  • Imports (via interconnectors) at 7.1% generating 5.92TWh (2.8GW).

These changes reflect the poor economic conditions for coal generation, as demonstrated by the closures of Eggborough and Ferrybridge power stations due to a combination of the UK’s carbon price support mechanism and falling gas prices delivering tight margins, and the investment needs of increased environmental requirements.

In the latest figures, wind continued to be the dominant source of renewable electricity, with 46.1% of renewables sources at 8.66 TWh (4GW), followed by biomass at 33.2% which generated 6.24TWh (2.8GW), hydro at 13.5% producing 2.53TWh (1.2GW) and solar at 7.2% generating 1.35 TWh (0.62GW).

Within the period these figures represented an 82% increase in solar and 22% growth in hydro outputs against the last quarter generation, with the respective gains being attributed to the continuing major build out of solar farms ahead of new tariff deadlines and higher levels of river flow.

Despite limited subsidies, the conversion of coal fired power stations to biomass also increased, with the figures reflecting the third Drax unit to come on stream burning 85% biomass.

Although biomass output shows relatively modest growth when compared to the previous quarter, levels of generation have risen 50% over a 12 month period, and are likely to continue to rise for a short time as further coal plant conversions are introduced.

Following a mild weather end to 2015, the country’s overall level of total power demand climbed by 18% during the first quarter of 2016. Despite this increase, with power availability levels also growing, the supply margin was generally very comfortable, although when levels of wind generation did drop away the system saw high prices for those stations able to provide additional power.

Paul Verrill, a director of EnAppSys, explains: “The changes we have seen in the market are driving much reduced levels of carbon emissions, with further coal closures and new offshore wind farms likely to extend this trend.

“However, as the market transitions into a low carbon future this has already created certain challenges and how we deal with these changes will prove to be a defining factor in maintaining a secure and low carbon energy future for this country.

“For example, the decline in coal’s share of generation is seeing the market relying more and more on intermittent sources of power, increasing the role of ancillary services and storage. At times this has seen National Grid pay millions of pound on ‘tight days’ to ensure that there is sufficient short term margin within the system. This has surprisingly come from the coal plants which had planned to close.

“One of the biggest issues facing the market into 2016-17 is the cost incurred to maintain margin until the capacity mechanism comes into full force in October 2018, and how National Grid and the government achieve this without distortion to market operation that can risk jeopardising  investment in new build.”

*For the full report:

http://www.enappsys.com/news_and_rep/Q1_2016_Market_Summary.pdf

EnAppSys is an independent energy specialist company that provides electricity and energy market data, systems and consultancy services to parties with an interest in the UK energy market.

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