The National Grid has reported that winter black-outs are at the highest risk in a decade as UK energy capacity margin falls to 1.2%.
David Lewis, energy efficiency expert at Schneider Electric commented: “The capacity crunch has hit the UK even harder this year and with such a tight margin, power outages could be a very real possibility.”
And notwithstanding retail price cuts announced today by British Gas, UK energy prices could rise due to emergency measures to bring power stations back on the grid in a bid to increase capacity.
Schneider added: “For decades the UK has been ‘sweating the assets’.
“Ageing – and cheap –thermal power stations provided plentiful, ‘always on’ power with comfortable capacity margins over peak demand. As the industry privatised, profitable provision of cheap energy from maturing assets was more palatable than investment and renewal.
“However this couldn’t last. Indigenous North Sea oil and gas production has fallen faster and harder than expected.
“Infrastructure is creaking and has begun to look out of step with the growing mood for cleaning up energy supply. The need for investment is clear but with a punitive budget recently announced, how likely is the grid to get the hundreds of millions in investment it needs?”
Renewable energy sources are one of the answers to the UKs capacity problem but the challenge lies in how to connect these sources while maintaining security of supply and affordability.
Schneider said: “While there are clear challenges and fundamental shifts to renewable sources we cannot overlook the huge opportunities in smarter energy.
The transition from brown to green energy overlooks the “fifth fuel” – energy efficiency. Two-thirds of energy is lost in generation and transmission of electricity. Reducing demand has a far greater impact than new sources of capacity.
We’re running out of time and money if we’re seeking to meet our winter needs with new sources – focus has to go on taming demand, with intelligent technology and market signals. Contracting dormant plants for back up is catching the tiger by the tail. Our response to the capacity crunch needs to be smarter and more efficient to bring demand back under control.”
And Paul McCullagh, Chief Executive of Glasgow-based Urban Wind, commented: “This is symptomatic of a growing problem, as the concerns over security of supply that we experienced last winter have grown significantly more severe.
“If we experience unexpected outages such as EDF being forced to take its nuclear plants offline like we saw last year, we face the very real prospect of brownouts and blackouts.
“Onshore wind is one of the cheapest and most readily deployable methods of generation that we have available to us, as well as being a low carbon solution. Instead of capitalising on this, we are forced to take the expensive option to pay mothballed power stations to be put on standby, essentially paying them for nothing for large periods of time.
“If we are required to bring these power stations back online to meet demand, we will be losing yet more ground against our carbon reduction targets.
“Moreover, the suggestion that we will pay major factories to be prepared to power down seems similarly like a backwards step and could put the UK’s economic recovery back at risk.”
However, the government insists that the lights will stay on this winter. Junior Energy Minister Andrea Leadson said: “Our priority is to ensure that British families and business have access to secure affordable energy supplies that they can rely on”,
“National Grid have confirmed that our plan to power the economy is working – and it means that the lights will stay on this winter as well as making sure our homes and businesses have the gas and electricity they need in the future.”
* Her boss, UK Energy Minister Amber Rudd will face questioning on security of power supplies in front of the Westminster Committee on Energy at its first post-election meeting next week under its first SNP MP chairman.