Along with most everyone else in the energy market I have been of the opinion that coal power stations in the UK must close by law by 1 October 2024. I have learned that this is not in fact correct.
In late 2020 the Government consulted with the market on bringing forward the closure date from October 2025 to October 2024. The 2025 date had never been passed into law, but it was Government policy and reflected changes to Capacity Market Rules which were designed to limit the participation of coal from Winter 2024. All of this culminated with an announcement in June 2021 that the Government would “will introduce new legislation to do this [bring forward the closure date to 1 October 2024] at the earliest opportunity”.
The Government was so confident that coal would no longer be required by Winter 2024 that it said it would not reserve emergency powers for the Secretary of State to delay the date of needed for security of supply reasons. I commented in a previous post that I had been unable to locate the final legislation to see whether that had remained the case when it finally passed into law.
I have now discovered that no such legislation has ever been brought before Parliament, meaning that the UK does not in fact have any mandatory closure date for coal-fired electricity generation.
I collaborated with Matt Oliver at the Telegraph to ascertain the position from DESNZ, which confirmed that:
“As all UK coal generators have already committed to phasing out their coal operations, it is not necessary to legislate to deliver on this commitment,”
– Department for Energy Security and Net Zero
DESNZ went on to say that after October 2024 Capacity Market rules will make it un-economic for coal to continue running. This statement likely refers to the Capacity Market Emissions Limits, Rules which derive from the Energy Act 2013 and are amended by making changes to this Act, either through a full legislative process, or, for smaller changes, through the use of Statutory Instruments.
“The Rules require compliance with the carbon emission limits by all ‘new’ capacity (i.e. when considered against the 4 July 2019 date introduced by the Electricity Regulation, that is generating units which are Fossil Fuel Components that have a Commercial Production Start Date on or after 4 July 2019) participating in all future auctions and Delivery Years, and by all ‘existing’ capacity (i.e. with a Commercial Production Start date before 4 July 2019) in respect of auctions for the Delivery Year commencing on 1 October 2024 and all subsequent Delivery Years.”
There are two carbon emissions limits that apply in the Capacity Market to fossil-fuel generators, and a generator must meet at least one of:
- 550g of CO2 of fossil fuel origin per kWh of electricity generated (“the Fossil Fuel Emissions Limit”); and
- 350 kg CO2 of fossil fuel origin on average per year per installed kWe (“the Fossil Fuel Yearly Emissions Limit”).
Ratcliffe burns hard coal, or anthracite, which has an Emission Factor of 98,300 kg CO2 /TJ and a Net Calorific Value of 26.7 TJ /gigagram. In order to meet the yearly emissions limit, and assuming a typical thermal efficiency of about 35%, this would mean Ratcliffe could only run for about 345 hours a year ie 4% of the time, which would indeed be uneconomic, unless an alternative income source is provided.
The lack of a statutory closure date for coal means that National Grid ESO is free to create a new coal contingency product. It is my opinion that any such coal reserve would need to be a year-round product rather than just a winter product – Ratcliffe has frequently run in the summer when wind output is low.
This could also apply to the two remaining units at Drax. ESO has said it is in ongoing discussions for Drax to participate in a coal contingency for this coming winter clearly signalling a desire to continue with the scheme to support security of supply, although Drax insists that no such discussions are underway and that its coal units have begun to be de-commissioned. It is my understanding that the de-commissioning process has indeed begun but has not progressed to a degree that could not be reversed. Perhaps if the parties understood that this reserve could continue beyond this winter and could apply year round, the prospect would be more appealing.
While I’m sure the Government is embarrassed that the much spoken of statutory closure date for coal does not actually exist, this is good news for energy security. The Government could choose to amend the Capacity Market Emissions Limits to make the ongoing regular commercial operation of Ratcliffe economic, or it could encourage ESO to develop a coal reserve which would keep both Ratcliffe and Drax open and available for use. I suspect that maintaining the current status quo would be cheaper for consumers, but it fits less well with the Government’s net zero narrative.
Either way, this is a win for consumers since it improves security of supply. Personally, I think the Government should accept that from a climate change perspective, one or two coal power stations is irrelevant, but from a security of supply perspective they continue to be useful. Against a backdrop of nuclear closures over the next few years, it would be prudent to keep this option open. Unfortunately, it’s difficult to move from the fanfare of closing coal, to a “nothing to see here” narrative, but that’s the way this should be pitched. Coal-fired generation has been decimated in the UK, the Government should take the win and not fret about the sliver that remains.
Top stuff, as usual, Kathryn. Your research puts other writers in this area to shame
Thanks Ralph – at first I assumed I was just failing to find the legislation, but teamed up with Matt to get to the bottom of it. There are some areas where journalists have an advantage – DESNZ couldn’t ignore the Telegraph asking about this but they could easily ignore me or force me to do an FOI request and wait weeks for an answer. They weren’t keen to admit it!
I am afraid that your assumption, that government press officers simply cannot ignore requests from publications with large viewerships or readerships, is entirely wrong.
I can assure you from considerable past experience , that such officials have long ago mastered the technique of prevarication, absenteeism and plain obduracy,. That is true whomever is asking them for information that is ostensibly in the public domain, but might conceivably cause embarrassment to one of their senior, let alone their political masters.
Indeed many would conclude that doing precisely this would be their accurate job description.
In this case they understood that not commenting would be worse and the story was being printed anyway, but I agree it’s not always the case.
They won’t, of course, but climate change zealots should also let this pass unremarked. There are already signs that public disquiet at the costs and inconveniences of Net Zero are increasing. Should the lights actually go out next winter, I predict a sharp dip in public support for the current headlong rush to Net Zero.
They won’t, of course, but the climate change zealots should also let this pass unremarked. There are already signs that the public enthusiasm for Net Zero is waning as the costs and inconveniences become more apparent. If the lights do go out next winter, the eco-lobby can expect public acceptance of the headlong dash for Net Zero to take a big dip.
This provides an interesting contrast with the FES and a Day in the Life 2035 stories. In the real world we are still struggling to close the remaining coal stations and yet for electricity to be carbon free we will also need to close all of the existing gas stations (in terms of CO2 emissions coal and gas are not that different). “Subject to security of supply” provides a useful bridge between the worlds of fantasy and reality.
As a mere outsider with regard to this piece, it would cause extreme consternation to me if the government couldn’t ensure the lights stayed on by keeping fossil fuel generation in place until we are better prepared. I did assume that civil servants were fully engaged in contingency planning.
I think, as others have said in the comments on recent blogs, that some of this planning is based on unreallistically optimistic models and forecasts.
Probably slightly off topic but as i type this we are in SP29 and ESO had forecast, as of 23.30 last night, that wind would be producing 12.2GW which itself was a 1GW reduction from original forecast. Actual production is 6.9GW so ESO have potentially had to find 5.3GW of alternative generation. Of course im sure the CCGT owners have been only too helpful to come in at a higher price on the BM to fill the gap but had it been deep winter all that capacity may have been on the bars already so this reinforces why we need some coal retained to provide baseload to allow the gas units to be rapidly despatched until at least Hinkley is online.
Thank you for this insight into governments crass handling of climate change. You and your readers will be interested in a well researched book on the fallacy of the governments Net Zéro policy. I highly recommend Ross Clark’s recently published ‘Not Zero. How an irrational target will impoverish you, help China(and won’t even save the planet)’. The more people that understand the realities and the truth about climate change the better for Britain.
I am afraid that Richard Martin’s statement regarding power stations, that , “in terms of carbon dioxide emissions, coal and gas are not that different”, is quite simply put, completely inaccurate.
The standard coal plant is responsible for around 961 grammes of fossil carbon equivalents per kilowatt hour. The average gas fired power station emits around 360g/kwh.That is very big difference.
Perhaps those amongst your correspondents who apparently dislike the existing”net zero” policy objective, would care to explain how they would seek to minimise the threat of accelerated climate change?
That’s true, and coal is much worse for other pollutants as well. I certainly would not want to see a return to the use of coal at scale, but I do think that climate harms need to be set against other harms – winter blackouts in the UK would very likely result in fatalities, particularly if they were unplanned outages. Higher energy costs also result in excess deaths. A couple of coal power stations would have a negligible climate impact but would be important in preventing blackouts during low wind periods, particularly against a backdrop of low levels of seasonal energy storage. We need to consider a range of responses to the threats we face, including mitigation ie managing the effects of climate change rather than trying to prevent it/all of it.
It’s clear the way not to do it is to collapse our economy to the point where we could no longer afford to adapt to changes in climate, which is the net zero route.
Another way would be to dissolve the IPCC entirely. Crank apocalyptic scenarios would lose backing. China would be faced with deciding whether its emissions were endangering its own future, rather than being able to hope that it can shut down Western economies and hope that is enough, while having the riches to afford adaptation. We could get back to economic improvement by making things efficiently and researching how to lower costs and materials use, instead of retrograde low EROEI wasteful spending. We might even get back to more serious science that helped to identify and measure real problems and find real solutions.
I am breaking my self-imposed rule never to respond to anonymous correspondents.
But really, pretending that the entire problem does not exist, is not a serious reply to my question, asking those who apparently dislike the existing”net zero” policy objective, to explain how they would seek to minimise the threat of accelerated climate change
I suggest you think a little more. Since attempts to terraform against trends in climate are a global scale issue you need global scale solutions. Wrecking the UK for its 0.9% share of CO2e emissions ain’t going to cut it.
That you consider a threat of accelerated climate change to be dominant suggests you take RCP8.5 as a central scenario instead of one with a vanishingly low probability because it compounds all the extreme elements of a much higher CO2 sensitivity beyond anything suggested by measurement or estimation and sharply rising demand and coal use etc. Such scenarios are responsible for the host of climate predictions already falsified that do the science no credit and risk undermining its credibility as each prediction is falsified: they are propaganda not science. So a return to proper science would be a good starting point.
Next to the extent that reducing emissions will help it is essential to tackle the largest emitters who are not party to any real reduction plan. So long as they feel they can get a free ride by getting the West to commit economic suicide they are not going to engage, especially as they profit from our stupidity. Hence my suggestion that instead we go back to the nuclear doctrine of Mutually Assured Destruction that actually worked so far to prevent nuclear war by telling these countries we are not going to kill ourselves via net zero policy for their benefit. If you have other ideas as to how to get coordinated global action to work please elucidate. We do not want to end up with Dr Strangelove mentality in control deciding that the solution is a bit of nuclear terraforming to create winter. It is deeply worrying that cranks like XR are so close to our seat of power.
Humans have a remarkable ability for innovation and work to build their environment and better mousetraps. We have learnt a lot about reducing the environmental consequences at acceptable cost. Our air is the cleanest it has been in decades if not centuries. We have learned how to be much more energy efficient. We should look to using our expertise to adapt to changing climate and ensure that we have the wealth and capability to do so. Putting our eggs in a Net Zero basket and then finding we have lost that capability, the climate continues to change, but the local predictions for us turn out to be wrong so the work we did do is useless really is not the right way forward.
I have no objection to having Net Zero as an objective but legislating a date to achieve it opens the government up (and it has already started) to legal action for non achievement. Such action particularly in view of the government having no idea how this objective could be met nor what it might cost was foolhardy in extreme. Talk of banning fossil fuel vehicles by 2030 and gas boilers by 2035 when we will not have the electricity supplies let alone structure to service EVs or Heat pumps and the plans to extend intermittent supplies by wind or solar displays considerable ignorance. Batteries are not the answer and this is due to a lack of raw materials and not the cost. Wind and solar cannot meet the country’s electrical base load due to intermittency and requires using costly open cycle Gas Turbine stations to meet demand. This makes our electricity more expensive than our competitors in Europe. The way to solve this problem is Small Modular Nuclear Plants (250 to 1000 Mwh) that we could build ourselves and quickly compared with the huge and expensive stations under contraction at Hinckley Point and Sizewell but I understand none has yet been ordered.
No SMRs have even obtained Generic Design Assessment acceptance in the UK yet – and the NuScale design only recently received approval from the US regulators. Unfortunately being small does not reduce the regulatory burden…we will be lucky to see any running before 2030, which is why in the short term I prefer ABWRs since they have previously been built in under 5 years.
Evening Kathryn, understand (& share) the concerns wrt energy security, but have you considered things like this in your analysis?
https://www.energylivenews.com/2023/06/14/octopus-urges-national-grid-to-drop-coal-for-cheaper-option/
https://www.businessgreen.com/news/4118694/summer-sundays-british-gas-launches-incentives-boost-green-power-demand
Of course a supplier that specialises in flexible tariffs would argue that DSR is better/cheaper than the coal contingency. Last year, NG ESO thought it needed both, and I’m inclined to agree. Currently fewer than half of households can participate in demand response (because they don’t have smart meters that operate in smart mode) and as this number increases, so will electricity demand as EV and heat pump use are also growing. It makes sense to keep our options open…
Also, while the volumes secured in the DFS last winter were higher than expected, this was against a backdrop of very high electricity prices and even then savings amounted to just a few pence per person each time. Unless the offering becomes more attractive, I suspect uptake will fall, particuarly when overall prices are no longer seen as expensive in a couple of years’ time.
I am afraid that Andrew Warren is following the misleading fossil fuel industry spin. Gas certainly produces over half the emissions of coal and is responsible for much of the success in reductions to date. However we are talking of requiring orders of magnitude of CO2 reductions to achieve the essential goal of net zero. Wind and nuclear emit over their lifetime 12g/kWh. Coal and Gas are in the same emissions ball park and neither will get us to net zero.
I see Drax and EdF have concluded talks on winter contingency by declining to offer any protection. So that leaves RATS on its market basis. I do wonder whether Drax has raised the fact that its CFD subsidised unit has in fact been heavily taxed by the method of calculating the Baseload Market Reference Price, and thus has been shut down except in the tightest of markets. It’s had zero output most months since last October. EdF will I’m sure have been keen to twist the DESNZ arm over windfall taxes on nuclear.
I see that DESNZ has orchestrated the maximum delay on the AR5 CFD auction to try to give them thinking time for how to react when the lack of bids becomes formal public information. A bit like strapping on a blindfold while depressing the accelerator while headed for a brick wall. Why do I see big orders for emergency diesel generators coming up? Perhaps because Ireland is already on that track.
I don’t think there was any prospect of WBA staying open…from what I heard it was literally on its last legs when it entered the contingency scheme last year. I was asked to comment on Drax taking its CfD unit out of the market recently – I pointed out that it’s up to the Goverment to get the rules right although Drax doesn’t help itself when it bangs on about how great the CfD is for consumers when it does that!
I can definitely see demand for diesel gensets – I’ve already been advising clients to look at contingency plans for grid interruptions.
Here’s what happened to the Drax and Lynemouth CFDs
https://i0.wp.com/wattsupwiththat.com/wp-content/uploads/2023/06/Biomass-CFD-Gen-1687987752.8672.png