Wednesday, 19 August 2015

Benefits of Longannet Closure?

It was announced yesterday that Longannet is to close next year. `PM blamed as end of Longannet looms': ScottishPower have blamed high transmission costs, which Scottish Government Ministers have labelled "discriminatory".

I wrote about this issue prior to the General Election, and I received a response from National Grid. This response stated that "It is true that while there is an excess of generation in Scotland, compared to local demand, then generators in Scotland pay more in transmission charges than those in England and Wales. ... It is worth noting that as the generation portfolio changes, the transmission charges will automatically adjust to reflect the direction of flows on the system – e.g. if further existing generation in Scotland closed that would cause the transmission charges for generation in Scotland to reduce and ultimately reverse."

This is not a point that I've seen in any of the coverage of Longannet's closure. Hopefully someone will be able to find the answer: by how much will transmission charges in Scotland fall as a result of the closure of Longannet? By how much (perhaps in £s per MW of installed capacity) can a windfarm (in Fife maybe) expect to improve its revenues? Could the impact of this closure on transmission charges perhaps mitigate some of the wind subsidy cuts announced by the UK Government?

1 comment:

  1. Craig Dalzell

    The problem goes a little deeper. The transmission charges are fundamentally hampering Scotlands ability to be an energy exporter. This will become increasingly important not just once we've replaced existing oil and gas based generation with renewables but as we replace oil and gas *extraction* with renewables. That replacement is currently not factored into the transmission fee calculations.