Government lowers target capacity for delayed T-1 auction

It has been reduced from 4.6GW to 2.7GW

The government has lowered the procurement target capacity for the delayed year-ahead Capacity Market auction.

The T-1 auction for the 2019/20 delivery year – originally scheduled to take place in January – was postponed to 11-12 June this year after the EU Court of Justice suspended the scheme in a landmark ruling in November last year.

The target for the auction was set at 4.6GW last year, however, Business and Energy Secretary Greg Clark has written to National Grid Electricity System Operator (ESO) to lower it to 2.7GW.

He says the reduction reflects a number of changes, including the volume of plant opting out but remaining operational and the volume of new build plant with capacity agreements in future years that have commissioned early but haven’t prequalified.

The Capacity Market, which is currently being investigated by the European Commission, offers financial incentives for ensuring power plants are kept on standby and are ready to provide back-up electricity when demand is at its peak, especially during the winter months.

Tempus Energy launched a new legal challenge last month at the High Court of London after BEIS said it was planning the top-up T-1 auction this summer.

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