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 until 2025, but decreases slightly in the long term relative to our previous forecast, plateauing at an annual average of £60.9/MWh in the 2030s.
- Until 2025, higher carbon prices countervail the downward revision to demand and fuel prices. Consequently, baseload prices remain similar at an annual average of £52.6/MWh.
- Beyond 2025, an upward revision to offshore wind capacity (up by 1.2 GW by 2030 and 2.7 GW in 2040), coupled with the entry of Viking Link in 2024, results in an average annual decrease in baseload prices of £0.9/MWh.
- The Contracts for Difference Allocation Round 3 resulted in 5,775 MW of capacity securing contracts, with offshore wind securing the majority of contracts (5,466 MW). Prices cleared at £39.65/MWh and £41.61/MWh for delivery years 2023/24 and 2024/25 respectively.
- The Labour Party’s “Green New Deal” and “composites” set forth ambitious decarbonisation targets to achieve net-zero emissions by 2030. Meeting this target will require a large-scale buildout of low-carbon technologies, reaching over 110 GW of solar and wind installed capacity by 2030.
- The Capacity Market has been reinstated following an investigation by the European Commission which concluded that the scheme is compliant with EU State aid rules.
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