Consumers could save more than £2 billion on their energy bills if the government’s renewable auctions include a wider mix of technologies.
That’s according to a report by Drax which looked at costs that are not reflected in the contracts the government awards for green generation.
That’s the amount National Grid has to pay to turn off a power station when the system is oversupplied or increase electricity generation when there is more demand.
The report added the costs increase for intermittent technologies such as wind farms and solar which means other forms of green power generation are needed to meet electricity demand.
While Drax claims the government’s auctions are focused on offshore wind it revealed the cost of other green sources are cheaper.
Offshore wind could require a Contract for Difference of £127/MWh while onshore wind would cost£92/MWh, solar £96/MWh and biomass £84/MWh.
Drax Group CEO, Dorothy Thompson said: “Intermittent renewables like wind and solar are vital as we continue to clean up energy generation but they need to be backed up by a constant supply of electricity that can be flexed up and down to make sure the UK’s businesses and households always have power on demand.
“Opening up energy auctions to include other renewables could save consumers £2 billion and with more biomass in the mix, energy security is also boosted. Using the latest technology we’ve upgraded half our power station to run on compressed wood pellets which give an 80% plus carbon saving against coal. With the right support we stand ready to finish the job.”