UK Electric Customers Will Still Be Paying For Gas Plants 10 Years After "Net-Zero" Deadline In 2030
The UK has given more than £12.5bn from energy bills to fossil fuel power plants in the past decade through a government scheme to keep the lights on during winter, according to new analysis. The research found that, since 2015, the government has offered contracts worth £20bn through a capacity market to create a backup reserve of generators on standby, of which about 60% were fossil fuel power plants and a quarter were energy storage and power cable projects.
This has included 90 gas power plants, which each clinched a contract of up to 15 years backed by a levy on consumers energy bills. It could mean households will still be paying for gas plants in 2040, a decade after the government has promised to eliminate 95% of fossil fuels from the UKs electricity system.
The report, by analysts at Aurora Energy Research, was published weeks after the Guardian revealed that the power grid operator was forced to use a separate scheme to pay almost £18m to two gas power plants in a single day to safeguard Britains electricity supplies when high demand for electricity combined with low wind speeds.
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The cost of maintaining a backup supply of gas power to run during still, cold winter weather when wind and solar power are in scarce supply is expected to balloon in the UK over the coming years as the country relies increasingly on renewable power to provide the backbone of its power system. Campaigners are calling for the government to accelerate a plan to set up an out of the market mechanism to manage backup gas-generated power to ensure plant owners are not allowed to command ultra-high prices when power supplies are tight, the report said.
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https://www.theguardian.com/business/2025/jan/28/uk-energy-bills-fossil-fuel-power-plants-capacity-market