Earlier quoted context omitted.
Author of the article here Electricity prices in the UK (and most other places) are set by the marginal unit, which is the most expensive unit that needs to be turned on to meet demand. All other generation for that time period gets paid the same price. The marginal unit in the UK is usually gas, hence the sensitivity to gas prices
Is that a good idea? It doesn’t sound very sensible to price everything at the cost of the most expensive unit, why do they do that?
It's claimed that another type of market would cause companies to speculate with their sell offers and thus generate less electricity. It would be interesting to see how this kind of market would work in reality, though.