Natural Gas Daily Europe Policy & Regulation
UK capacity market in urgent need of reform14 March 2017
The UK’s capacity market needs an urgent overhaul if it is to stimulate construction of new large-scale gas-to-power plants and bolster power supply margins that are expected tighten midway through the next decade, industry sources have told Interfax Natural Gas Daily.
Introduced in 2014 to boost power supply security during periods of peak demand, the UK capacity market has had two consequences that few expected: expanding the number of small, environmentally unfriendly and inefficient diesel power plants; and extending the lives of the country’s remaining coal-fired power stations.
Such trends are unsustainable in the medium-to-long term if the government is to stick to its plan of phasing out coal-fired generation by 2025 and hitting its decarbonisation targets.
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