UK Electricity Market Reform and the Energy Transition:Emerging Lessons

Michael Grubb and David Newbery

The Energy Journal, 2018, vol. 39, issue 6, 1-26

Abstract: The 2013 Electricity Market Reform (EMR) was a response to the twin problems of securing efficient finance for a new generation of low carbon investments, and delivering reliability along with a growing share of renewables in its energy-only market. Four EMR instruments combined to revolutionize the sector; stimulating unprecedented technological and structural change. Competitive auctions for both firm capacity and renewable energy have seen prices far lower than predicted and the entry of unexpected new technologies. A carbon price floor displaced coal, whose share fell from 46% in 1995 to 7% in 2017, halving CO2. Renewables grew from under 4% in 2008 to 22% by 2017, projected at 30+% by 2020 despite a political ban on onshore wind. Neither the technological nor regulatory transitions are complete, and the results to date highlight other challenges, notably to transmission pricing and locational signals. EMR is a step forwards, not backwards; but it is not the end of the stor

Keywords: Electricity market design; Capacity auctions; Renewables support (search for similar items in EconPapers)
Date: 2018
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Citations: View citations in EconPapers (2)

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Journal Article: UK Electricity Market Reform and the Energy Transition: Emerging Lessons (2018)
Working Paper: UK Electricity Market Reform and the Energy Transition: Emerging Lessons (2018)
Working Paper: UK Electricity Market Reform and the Energy Transition: Emerging Lessons (2018)
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Persistent link: https://EconPapers.repec.org/RePEc:sae:enejou:v:39:y:2018:i:6:p:1-26

DOI: 10.5547/01956574.39.6.mgru

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