We are pleased to present our latest GB Power Market Forecast, July 2019. This quarterly update presents Aurora’s comprehensive view on the state of the GB power market, and includes our latest outlook on prices, production, capacity, and asset performance to 2040.
The analysis draws upon our internal modelling capabilities, and much of the content has been developed through a detailed consultation process across private and public sector players.
Key developments in this quarter’s update include:
- Overall, our Central baseload price forecast remains similar over the entire forecast horizon relative to our previous projection, plateauing at an annual average of £61.9/MWh in the 2030s.
- Until 2025, baseload prices have decreased by an annual average of £1.6/MWh relative to our previous forecast. Changes over this period are due to an assumed earlier entry of Eleclink (from 2021 to 2020), and a dip in coal and gas prices of £3.8/tonne and 2.7p/therm respectively.
- Beyond 2025, prices remain similar as the earlier assumed closure of Hunterston B (from 2027 to 2024) and higher demand from Ireland counteracts slightly lower gas prices from FX rates.
- The UK has become the first major economy to commit towards completely offsetting contributions to greenhouse gas emissions after a parliamentary vote transposed the Government’s proposal to set a net zero emissions target into law on 26 June.
- The T-1 “replacement” Capacity Market (CM) auction for winter 2019/20 concluded on 12th June 2019. Amidst the ongoing CM suspension, the auction cleared at a record low price of 77p/kW, securing 3.6 GW of de-rated capacity.
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