London (Platts)--20Dec2012/757 am EST/1257 GMT

Coal-fired electricity generation continued to dominate the UK power mix in the third quarter of 2012, as the use of more expensive natural gas-burn fell to its lowest third-quarter share for 14 years, the Department of Energy and Climate Change said Thursday.

In its UK energy statistics review, DECC figures showed that total electricity generation was down 2.8% from a year earlier at 81.04 TWh as the total supplied fell 0.8% to 72.26 TWh based on provisional consumption data.

High natural gas prices continued to deter gas-burn, DECC said, with gas-fired generation falling 40.9% to 22.83 TWh in Q3, DECC said, paving the way for ever higher coal-burn. Coal-fired power rose by 49.9% to 28.66 TWh over the quarter, on the back of favorable dark spreads -- the difference between the price of power and the cost of coal and carbon.

Platts data shows a UK clean dark spread based on a 35%-efficient coal-fired power plant at GBP21.30/MWh ($34.65/MWh) on Wednesday, more than double the GBP8.41/MWh spread recorded on the same date last year.

Article continues below...

Request a free trial of: International Coal Report
	International Coal Report and its daily companion, Coal Trader International, deliver expert and respected price assessments for coal trading in the Atlantic and Pacific markets including price assessments for European CIF ARA, FOB Newcastle, Richards Bay and Indonesia.

Gas-fired power spreads have meanwhile declined dramatically in recent year, and the Platts day-ahead 50% clean spark spread -- the difference between the price of power and the cost of gas and carbon based on a 50%-efficient plant -- only just in positive territory Wednesday at GBP0.49/MWh, less than a quarter of last year's GBP2.04/MWh.

Nuclear generation was also stronger on the year in Q3, rising 14.4% to 18.03 TWh, which DECC said reflected "higher availability after outages in the third quarter of 2011."

Renewables generation was up 25.2% at 9.49 TWh, mainly due to increased wind capacity, the department said.

Broken down by renewable energy sources, the figures show that offshore wind production soared 54.2% year on year to 1.69 TWh, partly owing to the start of operations towards the end of the quarter at the 500 MW Greater Gabbard project in the Thames Estuary -- the world's largest operational offshore wind farm.

Biomass remained the dominant source of renewable energy output, with biomass-fired production gaining 25.2% on the year to 3.77 TWh. Onshore wind farms produced 2.56 TWh in Q3, an increase of 38.2% on the same time last year.

Total low-carbon electricity accounted for a record 34% of generation in Q3, DECC said, up from 28% in Q3 2011. The department did not provide a figure in TWh for low-carbon production.

--Anna Crowley, anna_crowley@platts.com
--Edited by Jonathan Fox, jonathan_fox@platts.com

Tweet