Energy NewsGas and nuclear lead in UK power capacity auctionBritain has secured 50.41GW of backup electricity capacity for delivery in 2021/22.

Energy UK says ‘UK must participate in EU energy market’Around five million vulnerable households will see a £58 increase a year on their energy bills from April.

New EU initiative targets private investors for energy efficiencyPlans to create a new initiative aimed at making invest-ments in residential energy efficiency projects more attractive to private investors have been approved.

UK funds space-based environmental solutionsThe UK Space Agency is providing £38 million in funding to use satellite technology to help deliver innovative solutions to global issues.

Falling oil prices ‘continue to impact UK firms’Falling oil prices continued to impact UK oilfield ser-vices (OFS) in 2016, with the sector’s turnover falling by 15.5%.

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www.tridentutilities.co.uk

13 February 2018

Gas and nuclear lead in UK power capacity auctionBritain has secured 50.41GW of backup electricity capacity for delivery in 2021/22.

A total of 74.24GW entered the Capacity Market auction – which pays power plant operators to make backup electricity available at short notice – out of which 67.9% were successful.

Gas power plants accounted for the lion’s share of the agreements at 29.6GW, followed by nuclear at 7.9GW and interconnectors, which were included in the auction for the first time, at 4.6GW.

Coal took a hit, with only 2.56GW of the total share, pumped storage stood at 2.5GW while battery storage accounted for only 153MW.

The auction closed at £8.40/kW per year.

The results will remain provisional until confirmed by Energy Secretary Greg Clark.

Energy and Clean Growth Minister Claire Perry said: “Getting the best deal for energy billpayers is central to our Industrial Strategy and the Capacity Market is helping to drive competition, protect customers and ensure security of supply.

“Today’s record low cost of £8.40/kW ensures that we have enough energy to provide homes and businesses in Britain with secure, reliable electricity supplies for 2021/22.”

Last week, operators of the Eggborough coal-fired power station in Yorkshire announced the plant will be shut down after failing to secure new supply contracts for delivery in 2018/19, which cleared at £6/kW.

Energy News 13 February 2018 www.tridentutilities.co.uk

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Five million households face energy price riseAround five million vulnerable households will see a £58 increase a year on their energy bills from April.

Ofgem said the level of its safeguard tariff – which stops suppliers from charging customers too much – will increase from £1,031 to £1,089 for dual fuel customers on average.

That’s mainly due to higher wholesale energy and policy costs to support low carbon forms of electricity generation, the regulator added.

It introduced the safeguard tariff for more than four million prepayment customers in April last year and has now extended it for an extra one million households, who currently receive the Warm Home Discount.

The million households are to initially make savings of around £115 a year on average but from April, that will fall to £66 a year.

However, consumers are still expected to be better off after April than if there was no cap on gas and electricity prices.

According to government statistics, these households will only see an increase of around 3.7% on their bills compared to an average 8% rise of dual fuel standard variable tariffs of the Big Six last year.

Chief Executive Dermot Nolan said: “Even when energy costs rise, people on the worst deals are better off under the safeguard tariff as they can be sure that they are not overpaying for their energy and any rise is justified.

“Ofgem is working with the government to protect all customers on poor value default deals, such as standard variable tariffs, from being charged too much for their energy as soon as possible. Our aim is to protect those who do not switch, while making it easier for those who do get a better deal.”

“Even when energy costs rise, people on the worst deals are better off under the safeguard tariff as they can be sure that they are not overpaying for their energy and any rise is

justified.”

Energy News 13 February 2018 www.tridentutilities.co.uk

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New EU initiative targets private investors for energy efficiencyPlans to create a new initiative aimed at making investments in residential energy efficiency projects more attractive to private investors have been approved.

The Smart Finance for Smart Buildings project, together with other EU policy initiatives, aim to unlock a total of €10 billion (£8.75bn) in public and private funds between now and 2020 for energy efficiency projects.

The European Commission said the initiative will help de-risk investments in the buildings sector, “giving investors and financiers a better understanding of the risks and benefits” of the investments.

It is estimated to support up to 220,000 jobs and help establish a renovation market for small businesses worth up to €120 billion (£105bn).

It suggests up to 3.2 million households could also be taken out of fuel poverty.

Miguel Arias Cañete, Commissioner for Climate Action and Energy said: “The building and housing sector accounts for 40% of Europe’s energy consumption but it needs much more investment and this initiative will help reduce the gap. It will also create local jobs and reduce energy poverty by using EU funds intelligently in a cost-effective way.”

Energy News 13 February 2018 www.tridentutilities.co.uk03

“The building and housing sector accounts for

40% of Europe’s energy consumption but it needs

much more investment and this initiative will help reduce

the gap.”

Leatherhead-based technology firm CGI received £2 million

to assess peat and forest conditions in Indonesia and

Malaysia.

UK funds space-based environmental solutionsThe UK Space Agency is providing £38 million in funding to use satellite technology to help deliver innovative solutions to global issues.

It has announced grants for 10 projects, worth £38 million in total, which include work into climate change mitigation, forestry, carbon emissions reduction and disaster management.

Leatherhead-based technology firm CGI received £2 million to assess peat and forest conditions in Indonesia and Malaysia.

It will use satellite observations and measurements to map peat conditions, monitor water levels and improve hydrology. This aims to reduce the frequency and severity of tropical forest fires, which occur over drained peatland areas.

These fires contribute to global carbon dioxide emissions and other negative environmental impacts.

Didcot’s eOsphere Limited aims to improve climate and disaster resilience for Mongolian herding communities using satellite images – it has received £1.6 million to do so.

Around a third of the population are dependent on livestock herding and highly exposed to extreme weather events, which are increasingly being exacerbated by climate change.

The project will help herders avoid and prepare for storms with better knowledge and equipment.

The United Nations Institute for Training and Research has received £9.6 million to improve resilience towards climate change in Fiji, the Solomon Islands and Vanuatu.

The project will use earth observation data to provide stakeholders with access to important information including disaster risk planning, food security, climate risk and other environmental concerns.

Energy News 13 February 2018 www.tridentutilities.co.uk

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Falling oil prices ‘continue to impact UK firms’Falling oil prices continued to impact UK oilfield services (OFS) in 2016, with the sector’s turnover falling by 15.5%.

That’s the suggestion from consultancy EY, which warns the industry’s approach to recovery in 2018 could prove critical for long-term success.

The report shows turnover declined from £35.7 billion in 2015 to £30.2 billion the following year, with reductions in profit across the whole supply chain.

It highlights how less than 2% of UK firms in the OFS industry achieved growth of more than £10 million and the earnings before interest and tax margin fell 0.8% as various cost saving initiatives proved less successful than envisioned.

EY says although operators have saved money by

improving production efficiency rather than investing in standalone projects, a continued lack of investment in new projects means this is not a sustainable solution long-term.

It adds companies on the UK Continental Shelf will find it particularly necessary to diversify as the region continues to mature, which will see higher operating costs and fewer development projects.

Derek Leith, EY Partner and Head of Oil and Gas Tax, said: “UK OFS companies cannot rely on growth in the UK alone to increase revenues and must both internationalise and diversify their operations to ensure long term survival.

“While it is encouraging to see a rise in export activity it is concerning that access in overseas markets is still very modest.”

“While it is encouraging to see a rise in export activity it is concerning that access in overseas markets is still

very modest.”

Energy News 13 February 2018 www.tridentutilities.co.uk

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