GB Power Market Forecast – October 2020
We are pleased to present our latest GB Power Market Forecast, October 2020. 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 2050.
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 highlights in this quarter’s update include:
- Our Central baseload price is forecasted to rise from £35.9/MWh in 2020 to £52.1/MWh in 2025, and £62.3/MWh in the early 2030s. The trend reverses beyond this point, and baseload prices start to decline to £56.2/MWh in 2050
- Relative to our July 2020 forecast, baseload prices decrease by an annual average of £2/MWh (or 3.4%) until 2050
- The decrease in baseload prices over the whole forecast horizon is primarily driven by the removal of BSUoS charges from generation onto demand from 2023, and a downward revision to our fundamental gas price forecast due to lower GDP growth assumptions
- This report also serves as our first GB Power Market Forecast to include hydrogen, which increases power demand and improves baseload prices and renewable economics.
- At the Conservative Party Conference, Boris Johnson reiterated his pledge for every home to be powered by offshore wind by 2030. To meet this target, 4 GW of offshore wind will need to be commissioned each year between 2025 – 2030, at a cost of £50 billion in capital outlay
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