Energy firm Carlton Power was originally awarded the subsidy for Trafford Gas Plant in 2014, however it failed to secure appropriate funding by the deadline set out by Capacity Market Regulations.
Subsidies for the multimillion-pound facility were set to amount to £30 million every year for 15 years.
With Carlton announcing last October that it would be unable to start construction this summer, union GMB stated the Government's energy policy is "failing".
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GMB national officer for engineering construction, Phil Whitehurst, said: "The withdrawal of the subsidy for Trafford gas power station is yet another damning indictment of this government's failing energy policy. Trafford gas plant has so far been the only recipient of the capacity market subsidy and with its cancellation seeming imminent, it's clear that the government's hopes to kickstart energy construction have come to nought.
"With the expectation that Hinkley Point will not be operational until 2025 the UK's ability to keep the lights on is now in dire straits. The possibility of power shortages is now a very real one and our current overreliance on renewables isn't making it any better.
The UK needs a balanced energy mix and, in order to meet our energy needs over the next decade, gas has to be a part of it. Along with renewables, nuclear and oil, gas will be an essential part of maintaining a reliable, balanced energy policy."
(LM/CD)
