On Monday 30th September, Ratcliffe-on-Soar power station shut down after over 50 years of operations. This marks the completion of the phase out of coal in the UK following the introduction of key EU and GB policies across the past 2 decades, such as:
- EU ETS and Carbon Price Floor making coal more expensive relative to gas, nuclear or RES.
- LCPD / IED schemes, limiting SO and NO emissions for existing and new-build plants.
- The UK became the first country in the world to put the phase out of all unabated coal by 2025 into policy in 2015, giving a strong signal to the market to shift away from coal generation.
- The EU and GB introduced capacity market reform to set emissions limits of 550g CO2/kWh, therefore excluding coal.
- Launch of various subsidy schemes to promote growth in RES which could act to replace coal in the generation stack.
Whilst the GB market has so far managed the closure of coal via supporting existing CCGT in the CM, new build flex has been thin on the ground, with relatively little new gas being supported. As ageing nuclear capacity follows coal into retirement over the next few years, a large flex deficit is accumulating.
