Member Article

Older Coal Plants Searching for Alternative Avenues

The more profitable nature of gas over coal power generation has caused coal plants to rely more heavily on higher price peaks and smaller within-day contracts to make their money. This trend is is changing the dynamics of the UK wholesale electricity market.

Although gas is often more profitable in the summer months, until this year the switch back to coal is commonplace during winter. However, the tides are now beginning to turn.

According toICIS, CCGT plants have met 29.3% of the UK’s electricity demand on average, beating out coal’s 19.6% share since 1st November 2015.

Inspired Energy Risk Manager Nick Campbell has commented on this report saying, “The UK’s carbon price support and a weaker pound against the dollar and euro that has increased coal import costs is forcing older coal plants to search for other profit avenues in the wholesale market.

As a result this has left coal generators searching for higher value and therefore moving from baseload and peak sales to look at particular half hourly periods or blocks.“

This was posted in Bdaily's Members' News section by Lauren Richardson .