Analysis of Global Power Market

Analysis of Global Power Market Overview of UK Power Market (1/3) The UK power market is one of the most mature and diversified power markets in Europe, and consists of four parts, including generation, transmission, distribution and supply. Power Generation • The UK generation ownership is highly diversified compared to other European electricity markets with over 150 firms operating with licenses to generate power in the UK. In terms of cumulative power installed capacity by 2018, major power operators include EDF Energy, SSE, RWE, Uniper and Centrica. Power Transmission • • There are currently three transmission operators permitted to develop, operate and maintain a high voltage system within their own distinct onshore transmission areas. These are National Grid Electricity Transmission plc for England and Wales, Scottish Power Transmission Limited for southern Scotland and Scottish Hydro Electric Transmission plc for northern Scotland and the Scottish islands groups. Power Distribution Currently, there are 14 licensed distribution network operators (DNOS) in Britain and each is responsible for a regional distribution services area. The 14 DNOS are owned by six different groups, namely SSE, SP Energy Networks, Electricity North West, Northern PowerGrid, Western Power Distribution, UK Power Networks. Power Supply • The major power suppliers in UK include EDF Energy, SSE, Npower, E.ON, Centrica, Scottish Power, while a number of smaller, yet growing participants like First Utility, Drax Group, Ovo Energy, etc. are also competing in UK power supply market. Overview of UK Wind Power Market • The UK is the world leader in offshore wind with the highest installed capacity globally, totaling 8.2 GW in 2018. Offshore wind generates around 9% of electricity in the UK, providing power to 4.5 million homes annually. In 2018 offshore wind generation reached a record level, increasing by 28%, from 20.9 TWh to 26.7 TWh. In the future, the construction rate of offshore wind project is expected to increase with a number of larger projects approved by the Crown Estate will get commissioned. In the UK, the Crown owns the marine estate, including the seabed around the coast of Britain, from the coastline to a distance of 12 nautical miles offshore and owns the rights to generate electricity from wind, waves and tides in the UK. The Crown Estate manages the marine estate on behalf of the Crown, and leases rights to develop offshore wind to renewable energy developers. 2018 was a record-breaking year for UK offshore wind, and by December 2018 there were 1931 fully operational offshore wind turbines on the UK seabed (43% of the European total) with a further 992 under construction. The market is subject to some competition with a number of players active in developing, building and operating those wind farms aside from SDIC. In terms of cumulative power installed capacity of offshore wind by 2018, major wind power operators include Orsted, Innogy, and Vattenfall. Source: Ofgem, Frost & Sullivan FROST SULLIVAN 23

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