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CAPACITY MARKET – Update on DEFRA’s Proposals to Regulate Generators with high NOx emissions

In view of the fact that pre-qualification for the 2016 Capacity Market opens on August 1st and closes on August 28th 2016, before the anticipated emissions limits consultation in the autumn, any AMPS Members involved in the Capacity Market Auctions should take note of the potential changes to emissions limits.

AMPS has received the following from DEFRA

In March this year DEFRA’s consultation on further reforms to the Capacity Market highlighted the role of diesel generators in contributing to harmful levels of air pollutants. The document announced DEFRA’s intention to consult later in 2016 on options including legislation that would set binding emission limit values on relevant air pollutants from diesel engines, with a view to having legislation in force no later than January 2019, and possibly sooner.

These proposals will be aimed in particular at curbing avoidable NOx emissions from new generators as well as preventing high local concentrations of NO2 from new and existing generators due to their damaging impact on human health. The consultation will seek views on the point at which controls should apply for existing installations, considering the need to balance local air quality impacts with broader considerations such as energy security.

Investors bidding for new capacity into the Capacity Market auctions in 2016 should be aware that installations with a thermal input less than 50MW that become operational after the publication of proposals are likely to be directly impacted when the legislation comes into force. The proposals are likely to require emissions limit values for NOx to be achieved within 5 minutes of plant operation where secondary abatement is required to meet the limit. The proposals will primarily affect diesel engines. However they may also affect other generators including older gas engines, such as those, which are not lean burn and some more polluting gas turbines, even if they operate for less than 500 hours per year. Investors should factor this into their decisions before bidding.

Details of the proposals for emissions limits for new plant and the controls that will apply to new and existing installations for the protection of air quality will be set out in further detail as part of a consultation document this autumn.

Generators that are used solely for the purposes of providing back-up power during power cuts or other site emergencies are not expected to be affected by the proposals.

Background

Full text of the March announcement can be found at;

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/504217/March_2016_Consultation_Document.pdf

 

Bernard Gospel – Technical Committee Secretary
TechSec@AMPS.org.uk

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