Scot-Govt. raise fears over capacity of UK energy industry to keep the lights on this winter

elecricity pylons gridScottish Energy Minister Fergus Ewing has written to the UK Energy Secretary, Amber Rudd, asking for urgent changes to the UK Government’s policies and seeking reassurance that energy security issues are being properly considered.

The letter follows the market notification earlier this week from National Grid of a shortfall in reserve capacity which resulted in calls for industry to reduce power consumption.

The recent Winter Outlook report by National Grid showed that capacity margins could be as low as 1.2% this winter without the use of largely untried contingency services.

Ewing has raised his concerns that UK electricity capacity margins are worryingly low and the UK Government’s energy policies are exacerbating the situation.

He urged the UK Government to change their policy direction to ensure faster build of new power capacity including renewable energy in combination with increased storage capacity as well as carbon capture technology for thermal generation.

The Minister said: “National Grid issuing an urgent request for more electricity shows it is becoming even harder pressed to keep the lights on this winter and highlights the complacency of the UK Government’s energy policy.

“The Scottish Government have warned the UK Government – repeatedly and at the highest levels – of the consequences of declining capacity margins, both face to face and in letters from the First Minister to the Prime Minister. These warnings have been ignored and advice rebuffed, despite mounting evidence of a problem.

“The fact that National Grid were forced to pay £2,500 per megawatt hour earlier this week compared with the typical price at that time of about £60 shows how worrying this situation has become.

“Ultimately it is the bill payer that has to pay for those huge spikes in electricity costs so if the situation is repeated there is a real danger of increasing energy bills for consumers.

“The situation of narrowing GB capacity margins will only be exacerbated when Longannet closes prematurely next year due to unfair transmission charges. Longannet could have played an important role for several years to come as we continue our transition towards cleaner forms of generation.

“Scotland is an energy rich country and is the ideal base for the development of a range of technologies which could alleviate the situation, including wind energy, carbon capture and storage and pumped storage hydro. But this will require movement on policy from the UK Government to encourage increasing energy system flexibility, security, and sustainability.”

Last week – for the first time – a new tool to balance the energy system, Demand Side Balancing Reserve (DSBR), was used to help manage the peak demand time between 5pm and 6pm, when families start to get home and cook dinner, but offices and factories are still open.

This involved a small number of contracted large businesses being asked, under a commercial arrangement, to cut their electricity use, for example by switching to back-up generators or turning off their air-conditioning for an hour.

The power shortage was caused by a number of factors including unexpected maintenance issues at aging coal-power stations, which lead to temporary shut downs at several power plants; low wind speeds, meaning wind farms were only able to produce one per cent of the UK’s required electricity, and no solar input, because the requirement happened when it was dark.

Dr Stephen Breslin, Chief Executive, Glasgow Science Centre, commented: “National Grid is clear that these measures are one of their many tools used to maintain a significant buffer of reserve power and that we were never moments from being plunged into darkness.

“Nevertheless, the need for these measures should focus our thoughts on addressing our future energy requirements and giving this issue the attention it deserves.

“Although this is the first time that this has occurred in the last three years it must act as a wake-up call to the public to help them understand the importance of planning ahead to ensure that we are able to meet the issue of our growing future power needs, in a reliable way and at an acceptable economic and environmental cost.”

Pixie Energy

Pixie logo Pixie Energy is an incubator and a facilitator of strategic research and project work, focusing on energy regulation, policy and markets at the local and national level. Find out more about Pixie Energy here.

Local Energy Matters: Scotland

Local Energy Matters: Scotland is a free-to-download brochure with a focus on energy tariffs in the two Scottish electricity distribution regions, as well news on local energy and low-carbon schemes.

Previous editions can be download here.

Scottish energy market overview

You can read an overview of the Scottish energy market here.

Scottish Government energy feed