Low-carbon generation hits ‘major milestone’

Low-carbon generation hit a “major milestone” in the three months to the end of September, supplying more than half of Britain’s electricity, a new report has revealed.

Renewed competition from gas nearly pushed coal off the system entirely, as it supplied just 3 per cent of electricity over the period, down from 38 per cent four years ago. It provided a smaller share than wind, solar or biomass – “a symbolic moment in the transition towards clean energy”.

The combined shares of all low-carbon generation – nuclear, biomass, hydro, wind, solar and French imports – reached a high of 50.2 per cent. “This share has risen gradually from just 20 per cent in 2010 and the trend is showing no signs of slowing down, although high-carbon generation will be greater in the winter months due to higher demand,” according to the report, which was conducted by Imperial College London on behalf of Drax.

Nuclear power did the bulk of the heavy lifting with a 26 per cent share of generation although renewables provided a further 20 per cent, “spurred on by continued growth in capacity”.

The growth in low-carbon generation and the demise of coal pushed the average carbon intensity of UK generation to a record low of 221gCO2/kWh. “This pace of decarbonisation is a welcome surprise, coming well ahead of the UK’s legal requirements to reduce emissions,” the report said.

Source: Drax

Emissions were down by a third on the same period last year and 56 per cent on four years ago. Gas generation accounted for 76 per cent of emissions, coal 14 per cent, imports 8 per cent and the transport of biomass fuels 2 per cent.

The report said the Carbon Price Support is largely responsible for the switch from coal to gas, as without it gas generation would still be around 20 per cent more expensive than coal generation and “emissions would undoubtedly be higher”. “While international gas prices have been falling for the last two years, so has the price of coal,” it added.

The transformation of the UK’s energy system means volatile prices are the “new normal”: “Negative power prices are happening more frequently, and this quarter saw the highest power prices for several years.”

After Britain witnessed its first negative power prices last summer, the country saw 45 trading periods with zero or negative power prices in the most recent quarter, “twice as many as during the whole of 2015”.

The report continued: “At the other extreme, Thursday 15 September was notable as it saw the highest peak prices in 3 years. Evening peak prices rose above £200/MWh for three days in a row, culminating in a price of £802/MWh on the 15th.”

Improved energy efficiency and impact of behind the meter solar generation pulled daytime demand down to levels previously only seen overnight on one Sunday in September. “The resulting shape of net demand, which dispatchable generators must follow, is very different from five years ago,” the report concluded. “The daytime peak from 8 AM to 10 PM has been replaced by a much shorter evening peak starting at 4 PM.”

Lecturer at Imperial College’s Centre for Environmental Policy Iain Staffell said the introduction of the capacity market next year should dampen the volatility somewhat: “It’s the peak prices where everybody recovers the money they need to fund the mortgage on the plant. If they’re getting that money elsewhere then you don’t need these really super high price spikes, so that ought to smooth a lot of it out.”

The displacement of dispatchable generation by weather-dependent renewables is also creating challenges for the stability of the energy system. Power supplied by synchronous generators – “the spinning turbines that act as shock absorbers for the system” – hit a low of 13GW during the quarter. Only 4.7GW came from flexible (i.e. non-nuclear) plants. “Prior to 2013, this minimum had never fallen below 10 GW,” the report pointed out.

“Traditionally I would have thought this could be a big problem,” said Staffell. “But I remember last year, one of the German operators said they are now capable of doing things, that they didn’t even dream were possible just four years ago.

“The cost of actually keeping the system in check has actually gone down over the last ten years, despite the fact they’ve got four or five times more renewables than we do, because they’re getting more efficient and capable of doing it.”

He continued: “There’s a mix of technical and social solutions… [that] should alleviate the problem, so it’s not the critical thing some people worry it might be.”