Informer Issue 527 - 31/08/2021

A record level of new-build renewables could be preparing to bid into the upcoming CfD round, according to analysis. Cornwall Insight said the pipeline of onshore wind and solar projects has been growing significantly in the last year and it believes CfD eligible projects could now total around 8GW. With around four months to go before the application window opens for the fourth auction round, a rush of solar PV planning approvals could increase the pipeline further.
James Brabben, Head of Assets and Infrastructure at Cornwall Insight, said there could be “some interesting decisions for new-build plants” ahead. If the CfD round is going to be ultra-competitive, he said it raises the question whether it is the right route to market for projects. Some developers may look to alternative options such as Corporate PPAs or look to find a commercial edge by incorporating other revenue streams such as co-located batteries. Although alternatives may be available to new build generators, he added that “ultimately these options are still challenging and the bankability of the CfD contract is likely to incentivise solar and onshore wind generators to bid into the auction round process”. The application window for the round will be open from 13 December to 14 January. Read more

The UK continues to be home to more offshore wind capacity than any other country, according to latest figures. With 10.4GW of capacity, the UK heads the league table compiled by the World Forum Offshore Wind, followed by China and Germany. The forum said that just over 1.6GW of new capacity was added globally during the first half of 2021, a slowdown of growth which it said was likely to be down to the impact of Covid-19. More than 10GW of offshore wind capacity is currently under construction worldwide with more than half of that figure being built in China. Separate figures from WindEurope showed Europe built 1.3 GW of new offshore wind between January and June. WindEurope CEO Giles Dickson said offshore wind already accounts for 3% of Europe’s electricity and is set grow rapidly. “Turbines are getting bigger and more powerful. And more and more countries are building offshore wind farms and committing to develop them as costs fall – offshore wind is becoming a whole Europe affair,” he said. Read more

A new project has been launched to capture waste heat from electricity transformers to generate hot water and space heating for homes and businesses. The project could save millions of tonnes of CO2 every year if rolled out across National Grid’s network of transformers. Electric power transformers generate huge amounts of heat as a by-product when electricity flows through them. At the moment, the heat is vented directly into the atmosphere and wasted. Nathan Sanders of SSE Energy Solutions which is working with National Grid on the project, said: “This groundbreaking project aims to capture that waste heat and effectively turn transformers into community ‘boilers’ that serve local heat networks with a low or even zero-carbon alternative to fossil-fuel powered heat sources such as gas boilers. “We see heat networks as a key part of the UK’s future low carbon energy infrastructure, enabling us to exploit waste heat sources and use these to heat homes and businesses across the country.” Read more

Ofgem is set to make a number of licence modifications ahead of the planned introduction of a legally binding target to ensure supply is quickly restored in the event of a nationwide electricity failure. The Government is proposing a new ‘Electricity System Restoration Standard’ to require National Grid ESO to be able to restore 100% of GB’s electricity demand within five days and set an interim target of 60% of regional demand to be restored within 24 hours. Ofgem has been consulting on a number of modifications to the transmission and distribution licences to facilitate the introduction of the standard and has now published its decision to press ahead with the changes which will take effect from 19 October. When BEIS announced plans for the standard earlier this year, it said a major blackout incident similar to those seen in the US, South Australia and Argentina was unlikely but that it was important to prepare for a worst-case scenario. BEIS said the standard will reduce restoration time throughout the country and ensure a consistent approach across all regions. Read more

Two firms have agreed to pay £6 million for breaching wholesale energy market regulations by supplying inaccurate data about the amount of power a generation plant could supply. Ofgem said ESB Independent Generation Trading Limited and Carrington Power Limited submitted inaccurate data to National Grid ESO about the amount of energy a power plant could supply, breaking rules around market manipulation NGESO in turn bought more energy from the Carrington plant than needed, leading to higher costs for consumers. The two companies have admitted to inadvertent breaches, taken action to prevent it happening again and agreed to pay £6m to the energy redress fund. Cathryn Scott, Regulatory Director at Ofgem said: “Data accuracy is essential for keeping the costs of running the electricity system as low as possible for consumers. This case sends a clear signal to all generators that we are closely scrutinising their conduct and will not hesitate to act if they fall short of the standards we expect.” Read more