In ReCharge’s Five headaches switch to zonal pricing would cause UK wind industry, (paywall) Leo Bertels views on zonal pricing are quoted extensively:
“You’ve got this drive to deliver a lot of capacity” for offshore wind, particularly in the next two CfD rounds to meet the government’s target of hitting 43-50GW of offshore wind by 2030, said Bertels.
“And so, what you’ll have is probably a need to bring forward projects in Scotland to meet that capacity target,” even though those projects would be the “most likely” to be curtailed due to excess capacity on the grid – exactly the kind of inefficiency zonal aims to eradicate.
Those projects are therefore the “most likely to consider a larger risk premium on their bid price,” he said. And because in CfD rounds the highest bid accepted for a wind project will also be the price awarded to all the others, “that’s potentially bad for the billpayer.”
