2GW Trafford Park to bid in Capacity Mechanism

30th June 2014

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Carlton looking to ‘power ahead’ with independent generation investment

  • 2000MW CCGT Project targets early 2015 construction start date
  • £1.2billion investment in the UK’s future energy security

Stokesley, North Yorkshire: Following DECC’s publication of the details of the Capacity Market and confirmation of the capacity which will be procured in the first auction to be held in December 2014, Carlton Power is now confident of securing investment for its generation plans in Trafford, Manchester.

Welcoming publication of the final EMR proposals, which have been laid before Parliament, and the issuing of detailed auction guidelines including the capacity requirements for the winter of 2018, Carlton Power has informed the Department for Energy & Climate Change that it intends to bid its 2000MW Trafford Power project into the first Capacity Market auction scheduled for December 2014.

Mike Benson, Business Development Director at Carlton Power said: ‘We are delighted that the Government’s Electricity Market Reform programme has now reached a position which means that Carlton Power will be able to bid in the first Capacity Market auction and deliver our Trafford Power project in Manchester by 2018.

Following the Minister’s confirmation this morning of the Demand Curve Parameters for the first capacity auction in December 2014, the Capacity Market is now ready to attract new independent generators and investors into the UK energy market and ensure we keep our lights on. It has been a long journey to get here but we thank DECC for its co-operation with the independent sector in devising a workable and bankable mechanism that means we can bring new sources of investment and expertise to ensuring the UK’s security of supply.’

The Government recognises that it is vital for new gas fired power stations to be constructed to replace the 11GW of coal fired power stations that are being forced to close by EU regulations, as well as older and less efficient gas plants. The new plant proposed at Trafford by Carlton will utilise the latest generation of gas turbines with an efficiency approaching 61%, an increase in efficiency over the first generation of gas fired power station of more than 20%. In addition to the benefits of greater efficiency reducing overall gas consumption and reducing carbon emissions by over 1 million tons a year compared to a similar sized gas station built in the early 1990s, Trafford will be the first station in the UK specifically designed with the flexibility and fast start up times required to support the expanding intermittent renewable generation such as wind and solar.

It is important to encourage investment from the independent sector in order to promote competition in both generation and supply and this will in turn deliver real value to domestic and business consumers in the UK. Investment in new independent power projects such as the 2000MW Trafford project will also be an enormous vote of confidence for the UK energy market which is a sector that has undergone radical change over the last 5 years.

However, Carlton asks the Government to heed a warning in order to ensure the investor focus developed over the past 12 months is not squandered by any delays to the planned auction date.

Mike Benson added: ‘We are now at a critical stage of the legislative process. Any further changes or disruption to the current timetable would be to the detriment to UK PLC and could seriously damage the confidence of new investors. Therefore, we strongly feel that whilst EU approval is an important step which needs to be fulfilled before new projects can be financed, the need for such approval should not be used as a reason to further delay the delivery of the Capacity Market auction.’

-Ends-

Notes to editors

Capacity Market

The Capacity Market is a key component of the Energy Act 2013. The secondary legislation has now been tabled in Parliament and is awaiting debate time before the summer recess. Once agreed by both Houses of Parliament, the proposals will then be formally submitted to the EU for state aid regulation approval. This is expected to take at least two months. The first Capacity Market auction is scheduled to take place between the 9th and 12th December 2014, the results will be announced on 24 December, and it will come into effect in October 2018.

Carlton Power

  • Carlton Power is the UK’s most successful independent power station developer based in Stokesley, North Yorkshire and has managed projects in the UK and Europe since the company was founded in 1995.
  • To date, Carlton has been involved in more than 4500MWe of power projects of which over 2300MWe is operating or under construction in the UK.
  • Carlton developed the Carrington Power Station in Manchester, the only new independent power station to start construction in the UK since 2008 and was instrumental in securing financing for the project which is now wholly owned by ESBI and under construction by Alstom/Duro Felguera.
  • The Trafford Power project is to be constructed on land next to Carrington Power in Greater Manchester and was granted Section 36 Approval in April 2010 for a 1520MW facility.
  • In May 2014, Carlton wrote to Secretary of State Edward Davey requesting approval to vary its existing consent on the Trafford Project, “to accommodate recent advances in gas turbine technology and developments in the expected operating regime for the UK electricity market.” Carlton wish to increase the size of the Trafford Power combined cycle gas turbine project from 1,520 MW to 2,060 MW.

For a PDF of this press release, click here.

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