Calls To Ban Coal From Backup Power Subsidy Scheme

Calls To Ban Coal From Backup Power Subsidy Scheme
3rd February 2017 Pentag Gears

The time has come to ban coal power stations from a subsidy scheme offered to those providing backup power for the UK’s grid, it has been claimed.

Energy firm Scottish Power and RenewableUK have come together to urge ministers to impose a ban on coal power stations from receiving subsidies in the next capacity market auction, where operators bid for contracts to provide backup power for the UK next winter.

The Guardian reported that both organisations have described the current situation as “a paradox”, with the government continuing to support coal-based power stations while also stating its intention to close all of the UK’s coal power stations by 2025.

Keith Anderson, the chief corporate officer at Scottish Power, suggested that the government should bring in an emissions restriction as part of the qualifying criteria for future auctions.

Because coal is the most carbon-intensive fuel, it would more than likely fail to qualify for these auctions.

“Replacing old coal with new gas is by far the cheapest way of reducing carbon emissions from the power sector and securing supply,” Mr Anderson argued.

While some within the energy generation sector agree with Scottish Power’s suggestions, others have said it could be more sensible to target diesel generators, rather than coal, because of the capacity market subsidies they have won in recent years.

Meanwhile, former chief executive of the National Grid Steve Holliday told the newspaper that the government should also consider the fact that smart technology is helping the grid become more flexible, and that in future it should be capable of coping with spikes in demand.

“By 2022 we should have half-hour metering which means lots more business customers can be flexible on their electricity demand; the government says all homes will have smart meters,” he explained, adding that growth in battery storage will also help meet demand at peak times.

As a result, Mr Holliday believes there’s no need to commit to “big central generation” too soon.

With the UK moving away from traditional energy generation sources towards low-carbon alternatives, some renewable sources are coming into their own.

Earlier in January, RenewableUK highlighted a report showing that offshore wind is on track to become the lowest cost, large-scale clean energy source available in the UK.

According to the research, the cost of generating energy from offshore wind has dropped by 32 per cent since 2012, bringing it below £100 per MWh. The industry and UK government jointly set a target to get the cost of wind power below this level by 2020, so it’s encouraging that it’s been hit four years early.

Benj Sykes, co-chair of the Offshore Wind Industry Council, commented: “The industry is cutting costs much faster than predicted, while creating thousands of jobs and stimulating investment nationwide.”

And with the government putting offshore wind at the heart of its new Industrial Strategy, the sector is expected to go from strength to strength.

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