UK coal power stations could face closure due to increasing costs

According to recent research by DECC (Department of Energy and Climate Change), upgrading a coal power station to ensure it is kept open could cost in the region of £130 million. The figure is based on a 1GW power station and a decision now needs to be made as to whether it is worth coal power generators investing to meet new standards or stay as they are but risk closure by as early as 2023.

The change has occured due to new European emissions standards for coal power generation and applies to around 9GW worth of stations across the country. If UK stations decide to continue as they are, many will not meet the new standards and may need to accept shorter running hours due to tightened carbon emission regulations. This could extend the period of time it will take to pay back the initial investment for improvement, which are made up of fixed operating charges as well as pollution abatement costs.

For those stations that currently fail to meet the new legislation, the criteria they need to meet includes the cleaning up of nitrous oxides (NOx)to adhere to the Industrial Emissions Directive, as well as requirements to replace parts that have aged or worn. With the majority of UK coal stations being over 40 years old, the potential costs for the UK could be exceptionally high.

The main consideration now is whether the investment and consequences of shorter running times is worth it when considering the payback costs.

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