Centrica to Shut Two Gas-Fired Plants in U.K.

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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland) -- British gas and energy giant, Centrica plc (OTC:CPYYY) (Windsor, England), has announced that it is closing two gas-fired plants in the U.K. and may have to close three others unless energy demand and profitability improves.

The two combined cycle gas-turbine (CCGT) plants getting the axe are Barry in Sully, located in the in the Vale of Glamorgan, and King's Lynn in Saddlebow in Norfolk. Barry came online in the late 1990s and has a generating capacity of 235 megawatts (MW) from one 160 MW gas turbine and one 75 MW steam turbine. King's Lynn is a 340 MW plant that was commissioned in the mid-1990s and uses a 220 MW gas turbine and a 120 MW steam turbine.

In addition to the closures, Centrica said that its plants at Peterborough, Brigg and Roosecote have been configured to run more flexibly and operate in the Short Term Operating Reserve (STOR) market, in an effort to cut their operating costs. Centrica operates eight gas-fired power plants in the U.K with a combined output of 4,200 MW, which it refers to as the "backbone of our generation strategy". However, the company warned that unless the market improves, it's possible that Peterborough, Brigg and Roosecote will also have to be shut down.

"Gas-fired generation is not making money at the moment," commented Sam Laidlaw, Centrica's Chief Executive Officer Sam at a financial results press conference last week. "We're shutting down two [CCGT plants] and we've moved three onto open-cycle." While gas-fired generation has proved weak for Centrica in 2011, others forms of electricity generation have proved more lucrative.

"Strong performance from our share of nuclear assets more than offset the impact of weak market conditions for our gas-fired power stations," Centrica stated in its financial report. "Our share of nuclear output increased by 16% to 11.2 terawatt hours (TWh) (2010: 9.7TWh), with fewer unplanned outages during the year."

Wind power generation also performed well thanks to more favourable weather in 2011.

"Our wind assets again benefited from availability of over 90%, and with weather conditions generally more favourable than in 2010, generated volumes increased by 21% to 596 gigawatt hours (GWh) (2010: 493GWh), with the load factor improving to 36% (2010: 29%)," the report stated. It added: "The construction of the 270 MW Lincs wind farm project is proceeding to schedule, although unfavourable weather conditions at the end of 2011 and early in 2012 delayed installation of the foundations. 48 out of 75 foundations are now complete, while the offshore substation has been installed and commissioning is ongoing. Lincs is expected to generate first power in the second half of 2012 and is expected to be fully operational in the first half of 2013".

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