Lower than expected availability of coal and CCGT plant was a key factor in the tighter supply margins seen last winter, according to a report.
The tighter margins were reflected in the fact that National Grid ESO issued six Electricity Margin Notices (EMNs) and two Capacity Market Notices (CMNs) between November 2020 and January 2021, although all margin notices were cancelled before the settlement periods they concerned.
In its winter review report, National Grid ESO said although margin levels were influenced to some extent by demand and wind output, the greatest driver was thermal generation availability which did not meet expectations. Unplanned interconnector outages were also a factor.
The winter saw the highest System Prices since 2001 which translated into spikes in wholesale prices. System Prices, which are used to settle imbalance volumes in the GB power market, reached a high of £4,000/MWh on 8 January. Wholesale day-ahead power prices exceeded £1,000/MWh on several occasions in January, with the market cap of £1,500MWh for the day ahead auction reached twice.
The system operator said although operating conditions were complex, it “continued to operate the system securely and reliably over the winter period”.
“However, as part of our standard continual improvement approach, we are using lessons learnt from last winter as an opportunity to review a number of elements regarding how we provide our Winter Outlook analysis,” it said.