The European Commission have cleared the UK’s capacity market scheme. The news that the commission had approved this scheme has just been announced this morning on Thursday 24th October.
What is the capacity market scheme?
The scheme was designed to safeguard the security of electricity supply in the UK. Power companies across the UK could receive up to £1bn if they share the cost of keeping any extra generation in the event of supply disruptions. The payments have been delayed however, as the court ordered the European commission to get more information on the certain aspects of the scheme.
Though there were also concerns about whether energy consumers were willing to reduce their consumption when needed with this scheme. However, the commission have since found no evidence that suppliers or consumers would be at a disadvantage, which is in line with EU state aid rules.
The Government are still planning their response to this announcement. Though we’re sure after the rise in shares and stock in notable UK-based power companies that the government will be more than happy with the scheme’s approval. Drax for instance won several contracts under the scheme saw their shares increase by 1.4%.
There is little information on the situation at the moment as we are waiting for the response. Energy live news have the full story and will continue to provide coverage of everything to do with this breaking news!