Andrew Warren reflects on the EU’s challenge to the UK’s capacity market
Andrew Warren reflects on the EU's challenge to the UK's capacity market and asks if this really is all about the 'procedural matters' Ministers have claimed
Shortly before last Christmas, a decision from the European Court of Justice (ECJ) brought to a crashing halt the UK government's flagship capacity market scheme.
This caused howls of anguish from those who are in business to sell electricity, who have been the almost exclusive beneficiaries of the £5.6bn paid out by the UK government through the scheme over the past four years.
The decision followed a case brought to the European Court back in 2015 by a small company, Tempus Energy. It revolved around a claim that the way the capacity market was being operated discriminated against companies that offered demand side response (DSR), thus reducing the amount of electricity being consumed.
Government's absurd response
The formal response to this binding legal decision from the UK government has been completely absurd.
The capacity market is the government's primary policy for ensuring security of electricity supply. The market takes the form of an annual auction for capacity to be deliver four years hence. Theoretically, firms bid into the auction at the price they... >> Read More