Britain's grid operator expects a new ‘Dash for Gas’: Publishing its Future Energy Scenarios (FES) report today, National Grid stresed that up to 7 GW of new CCGT capacity is needed to ensure supply security by 2022. These projections were made under a No Progression Scenario whereby "affordability considerations" dominate over “green ambition”.
“Gas will be used for flexible electricity generation, enabling the growth of renewable sources of generation,” National Grid said in its FES report, suggesting “the network should be prepared for a potential dash for gas.”
A surge in CCGT capacity would be a significant change of current market development. So far, capacity market auctions have failed to incentivise investment in new gas-fired power plants, with developers citing low strike prices at auction. Just one 2 GW combined-cycle plant is set to come onstream before 2020, partly thanks to investment backed by capacity contacts. Many more project developers are still waiting in the wings.
Despite the investment hiatus, National Grid is adamant that the UK’s future energy mix will see significantly more gas power. Over 12 GW of propose gas-fired capacity already has grid connection with a completion date before 2022, the TSO states in the hope that much more CCGT projects will materialise to replace ageing coal-fired plants.
Carbon capture, power storage
Decarbonisation stays a key goal, although the 2020 renewable target date is missed in all four FES scenarios. Yet, National Grid suggests “there could be up to 11 GW of CCS-enabled gas-fired power generation capacity by 2040.”
As for demand side response (DSR), the UK grid operator suggests that storage technology could be advanced enough to alleviate current requirements for industrial-scale DSR. “Battery storage and onsite generation negates the need for businesses to reduce their demand,” the report stated.
Power storage – vital to maximise the use of renewable energy – is expected to rise to up to 18 GW in a ‘Gone Green’ scenario.
Gas and diesel recip engines
Distributed generation – captive power plants that are not connected to the grid – is seen expand to up to 89 GW of overall installed capacity, covering nearly 49% of total demand under the optimistic green energy scenario. Solar PV combined with energy storage and small gas gensets would contribute to most of this decentralised capacity.
A more realistic short-term view suggests that small gensets will provide between 2.7 GW and 4.5 GW by the middle of the next decade. Capacity payments have greatly encouraged deployment and National Grid states that “small-scale gas and diesel reciprocating engines are currently the preferred technologies for investors.”