RWE Generation statement on the UK capacity auction
Last evening the Department for Business, Energy and Industrial Strategy (BEIS) announced that the third UK capacity auction has cleared at £22.50 kW/Yr. 52,425.302 MW have been secured for the UK for delivery in Q4 2020.
BEIS has released a provisional list of the UK assets which have successfully secured a contract, which you can view here. This information is still subject to Secretary of State approval. The auction ran from 6 December and closed on 8 December. The additional Early Auction in January will begin on 31 January and could run until 3 February 2017.
This provisional announcement suggests that RWE Generation has secured contracts for all of the sites that were entered into the auction - with the exception of our CCGT at Conoco Philips (with a de-rated capacity of 49.48MW) and three new build gas projects at our Cheshire site (with a de-rated capacity of 14.126MW each). This means we have 8.04 GW (de-rated capacity) of capacity agreements for the 2020/21 delivery year. We will assess the impact of the auction results on our business and on the market.
RWE Generation can produce around 9,000 MW of electricity and operates the most efficient gas fleet in the UK. The volatile market conditions for conventional generation power plants have continued during 2016. Operations remain difficult, however the Capacity Market has provided some stability moving forward.
RWE Generation will continuously look for opportunities to develop and look for efficiencies and cost saving across its business.