UK electricity capacity auction for 2028/29 clears at 60 pound per kW/yr
The National Energy System Operator (NESO) announced on Tuesday the auction for Britain to secure enough electricity capacity in 2028/29 was cleared at 60 pounds each kilowatt per year.
In 2014, Britain launched a market for power capacity in which it offered to pay suppliers to make capacity available so that the country had enough power.
Auctions are held four years before the date of delivery. A smaller auction is held one year prior to delivery.
The most recent capacity auction resulted to the procurement of 43.055.07MW across 669 Units of Capacity Market.
Analysts at Bernstein wrote in a report that the price for this year's auction was slightly lower than 65 pounds/kW during the previous auction of 2024.
Bernstein stated that "the expectation of tighter markets, along with a growing share intermittent renewable generation is driving up capacity market clearing price."
Utility companies such as SSE Uniper Drax and RWE were among the winners of these contracts.
Documents showed that 68.3% of the capacity contracts were awarded to power plants already in operation, with 15.2% awarded also to interconnectors between countries.
New plants secured 4,9% of capacity, while new interconnectors secured only 0.6%. Reporting by Sarah Qureshi in Bengaluru and Anmol Chubey in Oslo, with editing by Matthew Lewis and Eileen Soreng.
(source: Reuters)
