Onshore wind poised for first foray into Capacity Market
Renewables are poised to make their first foray into the Capacity Market after a number of onshore wind projects prequalified for the upcoming auctions.
They include the replacement for the cancelled T-4 auction which was due to take place earlier this year but will instead be held as a T-3 auction in January.
The register for the auction for delivery starting in 2022/23 shows 11 new onshore windfarms have prequalified. They have a combined nameplate capacity of 496MW.
However, participants bid and are paid according to their de-rated capacity. The low de-rating factors for renewables – a reflection of their intermittency – means the windfarms can provide just 41MW.
The same number of projects have also prequalified for the T-4 auction for delivery starting in 2023/34. Their nameplate capacity totals 654MW but has been de-rated to 49MW.
Only one solar project has prequalified for each auction – in both cases a 50MW solar farm in Anglesey which has been de-rated to 1.6MW. The de-rating factor for solar is even lower than for onshore wind.
Renewables were previously barred from taking part in the Capacity Market but earlier this year were granted access. Announcing the decision in May, the Department for Business, Energy and Industrial Strategy (BEIS) said it was “fair and necessary” for renewables to participate.
According to an analysis of the registers by Aurora Energy Research, a total of 61GW of de-rated capacity has prequalified for the T-3 auction, including 49.2MW of existing and refurbished capacity.
Of the new capacity to prequalify, combined-cycle gas turbines (CCGTs) account for 2.4GW, open-cycle gas turbines (OCGTs) for 1.1GW and gas engines for 2.3GW. There is also 3.5GW of interconnectors, 1.8GW of demand-side response and 0.5GW of new battery storage.
The procurement target for the auction is 44.2GW meaning there will be a surplus of up to 16.8GW.
Meanwhile, 64GW of de-rated capacity has prequalified for the T-4 auction, of which 47.5GW is existing or refurbished. The new capacity includes 7.1GW of CCGTs, 1.7GW of OCGTs and 2.5GW is gas engines, as well as 2.6GW of interconnectors, 2GW of demand-side response and 0.4GW of battery storage.
The auction will take place in March. With the target set at 43.5GW, the surplus will be up to 20.5GW.
A T-1 auction for delivery in 2020/21 is also scheduled for February, although the procurement target has been set at just 300MW.
The registers additionally confirm that the Hunterston B nuclear plant, which has been out of action for much of this year following the discovery of fresh cracks in the reactor cores, will shut down by the end of 2023 as scheduled.
They also indicate that its sister plant Hinkley Point B may remain open for the winter of 2023/24. Both were originally set to close in 2016, but four years beforehand EDF Energy extended their operational lives to 2023.
This article first appeared on edie's sister title, Utility Week