Lignite-fired generation cost overtakes CCGT in March

Lignite-fired power station generation price levels have risen above those of combined-cycle gas turbine (CCGT) power plants for the first time since the introduction of a temporary recovery mechanism, prompting market officials to declare the end of lignite as an energy source that can be relied on for lower-cost energy production.

RAE, the Regulatory Authority for Energy, set a regulated price of 227.27 euros per MWh for lignite-fired power stations for March, above the price level of 191.73 euros per MWh for CCGTs.

These figures, reflecting the operating costs of the two power-generating technologies, show that lignite-fired plants now cost more to run than gas-fueled power stations.

RAE, in setting its prices, has also taken into account a surcharge of 10 euros per MWh imposed on natural gas intended for electricity generation.

Just months ago, in January, the regulated price for lignite-fired power stations was set at 216.27 euros per MWh, well under that for CCGTs, at 343.64 euros per MWh.

Regulated prices levels for the two power-generating technologies converged in February. They were set at 205.61 euros per MWh for lignite-fired power stations and 210.44 euros per MWh for CCGTs, before a complete overturn in March.