Green energy surge fuels strange new world for generators

18th June 2017 | Commercial Energy

As the sun shone on millions of solar panels and unseasonable gusts turned thousands of turbine blades last Sunday, something remarkable happened to Britain’s power grid. For a brief period, a record 70% of the electricity for the UK’s homes and businesses was low-carbon: nuclear, solar and wind crowded out coal and even gas power stations.

This was a glimpse into the future of how energy provision will look in 13 years, because of binding carbon targets. The carbon intensity dropped below the “magic number” of 100g of CO₂ per kilowatt hour for the first time. That level must be the norm by 2030 according to the government’s climate advisers.

On one Friday in May, solar power briefly eclipsed the UK’s eight nuclear power stations. The grid recently went without coal for an entire day for the first time, and the dirty fuel is now regularly absent from power supply for hours at a time.

Green Energy

These milestones are having tangible effects. Solar cuts power demand for National Grid, reducing prices, while wind also lowers prices. That led to another first last week, when high wind output pushed down the wholesale price and resulted in negative power prices. This means some conventional power plants had to pay household suppliers like British Gas to take their electricity.

In Germany, lower power prices driven by the country’s green energy boom have wiped billions off the share prices of energy giants like Eon and RWE. But will the likes of EDF and British Gas owner Centrica, which own nuclear and gas plants, face the same fate in the UK?

There are two reasons that this will not happen. One is the UK’s capacity market, which has been set to cope with power shortages as coal plants have closed and renewables have made supplies more intermittent. The other is the payments from National Grid to fossil fuel plants for services that are vital to national power supply, such as “blackstart” – the ability to restart the nation’s power grid the event of a catastrophic, widespread loss of energy supplies.

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