Government and National Grid unveil emergency plans to avoid blackouts

10th Jun 2014 14:28

UK Energy Secretary Ed Davey has warned of dangerous pressure on the UK's power network in the coming few years, as old power plants come offline and before new capacity is ready.The government and National Grid have worked on plans to balance supply and demand in peak winter periods. Energy regulator Ofgem has previously warned that the amount that UK's total generating capacity exceeds expected peak demand, known as capacity margin, could fall from 6% to as low as 2% in 2015/2016, before bouncing back the year after thanks to new capacity.In a speech given at the Economist's UK Energy 2014 conference, Davey will say that previous concerns about a supply crunch in winter 2014/2015 have been assuaged but that winter 2015/2016 will still require a significant interventions by the government.The speech said that balancing measures were to be "entirely voluntary" and that "nobody will get cut off; no economic activity will be curtailed".Davy added: "Both the new demand and supply balancing services will be used only as a last resort - and are a safety net to protect households in difficult circumstances, such as a hard winter or very high surges in demand."The government, Ofgem and National Grid have sketched out interventionary plans that include paying high-energy-consuming companies to reduce their power usage at peak demand times during winter.National Grid has said it will require up to 330 megawatts (MW) of demand response capacity this winter, with the required capacity rising to 1.8 gigawatts in the winter of 2015/16.On Tuesday the company confirmed the launch of a tender for demand response and back-up gas power plant capacity, including the plans to pay companies who agree to help balance the grid.National Grid said it will run a tender in June 2014 for companies to help it make up to 330MW shortfall in a demand side balancing reserve (DSBR) to pilot the new service for winter 2014/15; and tenders by Autumn 2014 and in early 2015 for a total of up to 1,800MW of both DSBR and supplemental balancing reserve (SBR) for winter 2015/16."These tools will help ensure that the country continues to benefit from the levels of system security that we are used to," the company said. Explaining that DSBR service was looking to "sign up large energy users who have the flexibility to reduce their electricity use - for example by switching to back-up generation - when demand is at its highest between 1600hrs and 2000hrs on winter weekdays. This will be in return for a payment, and on a purely voluntary basis." National Grid already buys similar demand-side services from a range of businesses, and many large businesses already reduce their electricity usage in peak demand periods to reduce their costs, it explained.EEF, the organisation for UK manufacturing companies, expressed it concern at the fact that measures were needed. EEF's Head of Climate & Environment Policy, Gareth Stace, said: "Security of energy supply is becoming an issue of increasing concern for manufacturers and today's projections show a worryingly thin capacity margin." It added: "While these measures are welcome, we should never have found ourselves in the dire situation of having to bring forward last minute solutions to avoid blackouts. The looming capacity crunch was both foreseeable and avoidable. What is essential now is to get moving from day one to ensure we're not in this position again."OH