Plans to help keep the lights on this winter by paying big businesses to cut their power usage during weekday evenings have been scrapped after National Grid failed to find enough willing participants. The company launched a tender in April for its “demand side balancing reserve” scheme to ease the strain on the grid between 4pm and 8pm as a “last resort” if UK supplies were scarce. Under the emergency scheme, which was used when power plants broke down last winter, businesses could either cut their total electricity usage, or switch to using alternative source of off-grid power such as a back-up generator. But National Grid has now announced it will not proceed with the plans for this winter after the tender showed that “minimal volume would be available”. The company was seeking to recruit businesses that could reduce their demand by 177 megawatts (MW), but only had offers totalling about 30 MW from firms willing to take part in the scheme between 5pm and 6pm, the hour when UK demand typically hits the absolute peak and the last resort measures are most likely to be needed. A spokesman insisted the failure of the scheme would not affect National Grid’s ability to keep the lights on this winter, as it has already procured extra generation capacity through a separate last-resort scheme that pays old power plants to stay open on standby.
Telegraph 22nd Aug 2016 read more »
Critics say National Grid has not given enough incentive for users to sign up, while at the same time overpaying highly polluting coal-power stations to remain on the system as back-up. Last year, the company agreed to pay old coal-power stations to remain in reserve in case of another unexpected outage at a rate of up to £88,000 per MW of capacity. If they are called into action they are guaranteed to be paid up to £14,000 per MW-hour of use.
FT 22nd Aug 2016 read more »