BEIS seeks views on bringing renewables into 2019/20 capacity auction
The Government is seeking input and views on how to bring unsubsidised renewables and hybrid projects into the Capacity Market (CM). It is five years since the legislation introducing the CM – the Energy Act 2013 – was passed.
This review, undertaken by the Department for Business, Energy & Industrial Strategy (BEIS) will assess whether:
- the CM is still needed in future;
- the CM is meeting its objectives of ensuring the security of supply, cost effectiveness, and avoiding unintended consequences;
- these objectives remain appropriate; and
- they can be achieved in the future in a way that imposes less regulation.
This call for evidence is the first step in the review process. BEIS’s consultation seeks views and evidence on the performance of the CM and on any issues or opportunities to consider in ensuring the CM remains fit for the future.
The Government’s current view is that the CM is broadly working as intended and, while it expects the review will identify opportunities to enhance elements of the CM, it does “not foresee the need for fundamental change at this point”.
BEIS says it would also like to use this call for evidence to understand more about these issues and other stakeholder concerns.
This call for evidence also provides a valuable opportunity to explore whether and how the CM needs to adapt in light of recent changes in the energy system and wider energy policy, and to ensure it remains fit for the future.
Following this call for evidence, BEIS intends to consult promptly on the priority issues that emerge, including the participation of renewables and interconnectors de-rating factors. This will ensure that BEIS is in a position to introduce necessary amendments to the CM Regulations and Rules on key or urgent changes ahead of the auctions in winter 2019/20. The team at BEIS expects to consult on other issues identified through the call for evidence to a slower timeframe.
The outcomes of these reviews will be reported to Parliament in summer 2019.