Polish power market costs are a billion PLN higher than the Government expected
"The Polish capacity market price is higher than expected by the majority of experts, who believed that the situation in Poland would repeat what happened in Great Britain, where the price last year amounted to 22.5 pounds, i.e. about 115 PLN. Why did this happen? In July 2018 Hanns Koenig and Filip Piasecki from Aurora Energy Research managed to more or less accurately predict the price (they forecasted PLN 249) and highlighted three main reasons. Firstly, much higher investment needs of Polish coal-fired power plants, which have to adapt to the stringent emissions standards. Secondly, there is little competition, with only 15% excess demand. In addition, Poland has much lower embedded/distributed benefits, which contributed to lower bids in the British market.
"Electricity prices could double after the government suspended the UK’s system for ensuring there is a back-up power supply, experts have warned. The government suspended the capacity market on Thursday after the European Court of Justice (ECJ) found it breached state-aid rules. Analysts at the think-tank Aurora Energy Research forecast power prices next winter of about £60 per MWh if the capacity market is reinstated, but up to £121 if it is not. On Friday, the power price was £55.