As the year draws to a close, Current± takes a look back at some of the most significant stories of 2018. Today we recap stories from the first two months of the year, including news of coal’s collapse in the Capacity Market and government investment in V2G.
Centrica pits battery storage against gas
Centrica started the year with a bang, revealing more details surrounding its planned 100MW battery in Ireland. Having confirmed that the project was in the works two months prior, in January the energy giant submitted a planning application to Kilkenny County Council to progress the project in line with Ireland’s DS3 mechanism.
However, the prospective battery was also revealed to be competing against a 100MW open cycle gas turbine (OCGT) that a joint-venture between Centrica and Greener Ideas had earmarked for the same site. That prospective project would be similarly suited to the DS3 auction, and the duo said that only one technology would be brought forward, essentially pitting battery storage against gas.
A decision has yet to be made.
BEIS aims to shift gear with V2G investment
January also saw the UK government announced a £30 million investment in vehicle to grid (V2G) projects, supporting more than 20 such pilot programmes that brought together manufacturers, energy aggregators, infrastructure operators and energy suppliers.
More than 80 companies, including the likes of Honda, Nissan and Mitsubishi, were confirmed as involved following a selection process overseen by Innovate UK, with funding put forward by the Department for Business, Energy and Industrial Strategy.
This was the first time the government had recognised the potential value in V2G systems in supporting both EV adoption and the delicate balance of the grid and, in truth, was a signal for what would be a significant year of movement in the UK’s EV sector as the government looked to shift gear.
Coal collapses as Capacity Market auctions throw up surprises
February kicked off with the T-1 and T-4 Capacity Market auctions (we’ll hear more about those in the editions ahead, of course) which threw up a few surprises. First up was the T-1 auction, which saw battery storage projects and demand-side response capacity secure more than 500MW of power.
But the real story of the T-1 auction was the fact that two coal plants were forced to exit without a contract, leading to the premature closure of the 2GW Eggborough Power Plant after its owners admitted that the plant was no longer economically viable without Capacity Market contracts.
DSR, meanwhile, emerged with 430.5MW of contracts shared between the usual suspects of SmartestEnergy, Limejump, KiWi Power, Endeco and Flexitricity, as demand response embarked on what would turn out to be something of a banner year for the technology.
A week later saw the T-4 auction for the 2021/22 winter period take place, but with markedly different results. A total of 50.4GW of capacity was procured, but at a record low clearing price of just £8.40/kW per year, nearly one-third of the previous T-4 auction’s clearing price.
Such a low clearing price was important for two reasons. Firstly, just 762MW – or 1.5% of total procured capacity – was new-build generating capacity, allowing established CCGTs to clean up. Secondly, battery storage capacity secured just 153MW as new de-rating factors and the low clearing price took a total on project viability.
But, as has already been alluded to, the Capacity Market would have far bigger issues than a low clearing price to contend with as the year progressed.