Wait, that figure.....it looks familiar.... It certainly makes for an eye-catching headline, even if it disguises the fact that Cornwall Energy have predicted an even greater impact on the cost of delivering additional capacity of £364million in the post-Brexit era.
Predictions of the level of awarded auction prices have jumped from £42 to £49 per MW, as increased uncertainty around future return and increased risk premium attached to finance drives up the bid cost.
Whilst this is not unexpected, the future ability to trade energy (and gas in particular) with our European neighbours is of key importance and the ease with which this can be done is far from guaranteed. Retaining access to the single market is therefore likely to be high on the agenda for gas developers and capacity market entrants in general. Over to you, David and Boris.
Doubts over the future operation of the energy market and increased financing costs will lead energy companies to demand greater subsidies to build and operate power plants, consultancy Cornwall Energy claimed in a report. Under the Government’s “capacity market” scheme, energy companies are offered subsidies to guarantee their power stations will generate electricity when needed in future winters.