Coal output falls show major shift in power market trends

The much-reported three-day period in late April, during which no electricity was generated from UK coal-fired power stations, marked a new low for coal’s place in Britain’s energy scene. Following a 55-hour period of no coal generation in mid-April, a second coal-free period, lasting 76 hours, ended on 24 April. During this period gas was the largest source of power, followed by wind and nuclear.

But generating enough electricity to meet a dynamic load is a complicated business, and it may be that the role of coal-fired generation is changing, rather than heading inexorably to zero.

The power source that used to provide the bulk of Britain’s electricity – coal – has become the mainstay of the country’s energy reserve system, as a back-up to gas, suggests energy market monitoring firm EnAppSys in a new report on the electricity market for the first quarter of this year.

The study showed that coal’s share of the GB power mix fell to a Q1 record low 9.4% (8 TWh) in the first quarter of 2018 – in sharp contrast to the 58% (40 TWh) generated as recently as Q1 2012.

However, there were instances when coal plants came to the rescue when there was a shortage of power from other sources, says EnAppSys. On Thursday 1 March, National Grid issued a gas deficit warning to indicate a potential shortage of gas on the system, and coal stepped into the breach, generating 10.5 GW of power – effectively the highest possible level of coal output achievable at the time.

EnAppSys said coal had gone from being the dominant player in Britain’s power mix to a vital provider of reserves when the system needed additional supplies – on 1 March due to a fuel supply rather than a capacity shortage.

Paul Verrill, Director of EnAppSys, said: ‘The ability of the system to fall back on coal in this phase of the market has proven highly beneficial and marks a major strategic shift in the way coal plants are being used in GB power generation. The additional electricity that coal produced on 1 March helped reduce gas use, reducing the risk of gas interruption.’

The first three months of the year were also notable for record levels of wind generation and high gas prices, which pushed up overall power prices, says EnAppSys. Wind farms set new records for half hourly, daily, weekly, monthly and quarterly levels of generation, with 16 TWh of power coming from wind sources during the period. The strong performance of wind helped overall renewable output to hit 25 TWh – the highest ever level recorded in a single quarter in Britain – which meant renewables were the second largest contributor to the GB power mix behind gas-fired plants.

Verrill said: ‘The performance of renewables highlights just how important this electricity source – and particularly wind – has become to Britain’s power mix. With offshore wind farms a cheap and relatively uncontroversial source of power, levels of wind generation are expected to continue rising and this trend will be fast-tracked by the Western Link interconnector coming on stream later this year.’

‘Much of the onshore wind farm capacity within Britain is based in Scotland, but there are relatively limited levels of export capacity down into the rest of Britain through northern England. The Western Link will move power from Scotland into England and this will reduce the likelihood of wind farms being paid to go offline due to transmission constraints,’ he concluded.