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GB power: reflection on GB 2021/22 T-1 CM auction – March 2021

The GB 2021/22 T-1 Capacity Market auction – March 2021 cleared at a record price of £45 /kW. This was due to a confluence of factors including the economics of EDF’s retiring West Burton coal plant. In this note, we highlight the key drivers of the high clearing price for the 2021/22 T-1 CM auction, and the likelihood of this repeating for the upcoming 2024/25 T-4 CM auction.

As we do not expect the occurrence of similar conditions for the 2024/25 T-4 auction, our Central forecast remains at £14.1 /kW with a range of £8 – 20 /kW. However, as highlighted in our previous reports/webinars, concerns surrounding Net-Zero ambitions could increase this to £35 /kW.

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