T-1 auction

DESNZ has accepted National Grid ESO's recommendations to increase the forthcoming one-year ahead (T-1) and four-year ahead (T-4) auction targets to 0.3GW and 0.5GW respectively.

In this week’s edition of Current± Price Watch – powered by Enact – we take a look at the caution suggested by the high T-1 Capacity Market clearing price, the changing face of nuclear in Britain and the saving seen by industrial participants in the ESO’s Demand Flexibility Service.

The Capacity Market’s T-1 2023-24 auction has cleared at its second highest price ever, with 5,782.777MW procured at a clearing price of £60/kW/y.

​Gresham House Energy Storage Fund (GRID) has secured over £108 million in revenues through the T-1 and T-4 Capacity Market auctions.

The energy crisis in the UK is contributing to record clearing prices in the Capacity Market (CM), with the mechanism’s design in turn exacerbating tight capacity margins, EnAppSys director Paul Verrill has said.

​As expected, the Capacity Market’s T-1 auction has entirely cleared in the first round at its highest ever price.

We’re pleased to announce that EnAppSys’s director Paul Verrill is joining us for the first Current± Briefing webinar of 2022 to discuss the impact of the energy crisis on the Capacity Market.

The government has set the forthcoming T-1 Capacity Market auction target volume at more than 5.36GW in response to what it has described as “broader uncertainties within the power sector”, meaning all participating assets in the auction are set to gain contracts at the maximum price of £75/kW per year.

​The target for the T-4 2025/26 Capacity Market auction is to remain broadly in line with its predecessors, while the T-1 2022/23 target has risen compared to 2021/22.

​All Capacity Market Units (CMU) may be required to be part of the Balancing Mechanism, according to a new consultation launched by the Department of Business, Energy and Industrial Strategy (BEIS).