Plutus PowerGen PLC Response to OFGEM Statement (2893Y)
March 02 2017 - 1:00AM
UK Regulatory
TIDMPPG
RNS Number : 2893Y
Plutus PowerGen PLC
02 March 2017
Plutus PowerGen Plc / Ticker: PPG / Index: AIM
2 March 2017
PLUTUS POWERGEN PLC ("PPG" or the "Company")
Response to OFGEM Statement
Plutus PowerGen Plc (AIM: PPG), the AIM listed power company
focused on the development, construction and operation of flexible
electricity and gas power generation in the UK, notes the statement
from OFGEM that it is "minded to" cut TRIAD payments to local
embedded generators.
The Board believes that the proposed modifications to the
current system outlined by OFGEM could cause significant harm to
the UK's industrial sector, and in turn consumers, as well as a
wide range of distributed generators and energy storage developers.
The Board supports National Grid's view that the proposed changes
further threaten security of supply as necessary capacity is forced
off or delayed. Accordingly, it believes the OFGEM proposals to be
deeply flawed, narrowly focused and potentially very damaging to UK
industry and investor confidence at a critical time. The Company
looks forward to an active participation in the consultation
process.
The Board welcomes the proposed wider review of the regulatory
and market arrangements surrounding network charges (the Targeted
Charging Review or 'TCR') also promised by OFGEM. The Board
believes this work will result in a more cohesive assessment that
recognises and values the benefits that flexible energy generation
plays in the UK currently by delivering a critical supply of energy
to combat the instability and volatility created by the increasing
use of renewables; which by their very nature provide power
intermittently to the National Grid.
PPG and its projects benefit from access to multiple revenue
streams in addition to TRIAD, namely Short Term Operating Reserve
(STOR) and Firm Frequency Response (FFR) as well as receipt of the
prevailing power price at the time of generation. For PPG, the
maiden profits recently reported in the Company's interim results
were achieved via the receipt of management contracts for its
projects before the commissioning of its Plymouth site,
highlighting the continued scope for profit growth as it continues
to add projects to its pipeline.
PPG CEO Phil Stephens said, "Network charging is a very
complicated and an emotionally charged topic in the UK, which has
dramatic knock-on effects across many sectors. Any decision to
implement change should not be taken lightly, narrowly or suddenly,
but must instead be careful, holistic and systematic. The statement
from OFGEM indicates that it prefers to deliver a short-term
response to a complicated, long-term issue.
"PPG's projects tap into a range of revenue streams which is
testament to the strong requirement for the critical supply of
energy we provide to the UK market, which is currently volatile and
at risk of black and brown outs due to the ongoing reconfiguration
of the UK power generation mix. The proposals provide very little
recognition of this, instead narrowly focusing on the interests of
large integrated energy companies. I believe this decision could
cause significant harm to industrial manufacturers, many of which
have embedded generation, which in turn could affect consumers and
the UK's commercial competitiveness."
Until the consultation process and formal decisions have been
announced, PPG will not be making further comment.
**ENDS**
For further information, please visit www.plutuspowergen.com, or
contact:
Charles Tatnall Plutus PowerGen Plc Tel: +44 (0)
20 3705 8350
Phil Stephens Plutus PowerGen Plc Tel: +44 (0)
20 3705 8352
Andrew Craig Cantor Fitzgerald Tel: +44 (0)
Europe 20 7894 7000
Richard Salmond Cantor Fitzgerald Tel: +44 (0)
Europe 20 7894 7000
Elisabeth St Brides Partners Tel: +44 (0)
Cowell Limited 20 7236 1177
Grace-Anne St Brides Partners Tel: +44 (0)
Marius Limited 20 7236 1177
Notes to Editors
Plutus PowerGen Plc is an AIM listed company focused on the
development, construction and operation of flexible stand-by power
generation sites in the UK. At present, the market dynamics for
flexible power generation are positive due to the continued
downward pressure on capacity available to National Grid to balance
supply and demand, leading to their announcements about possible
power shortages over the next few years.
Flexible Power generators such as PPG offer a viable and timely
solution to the power capacity shortfall in the UK. To this end,
PPG is initially focusing on delivering 200MW of capacity by the
end of 2017 and currently has a project pipeline of potential
development sites with 700MW of power generation capacity.
PPG has a straightforward multi-revenue stream model with large
and stable counter-parties and is using project/EIS funding through
SPVs to finance construction of the generation assets. This
structure has the benefit of limiting dilution to plc shareholders
as the assets are financed and built.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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