Electricity margins are expected to be tighter than originally forecast this winter, but the system operator has stressed it is confident the lights will stay on.
National Grid ESO’s latest Winter Outlook report forecasts a margin between supply and peak demand of 3.9 GW for this winter – equivalent to 6.6% – after provision for outages and breakdowns. This is lower than the 4.3% forecast in July with the reduction due to issues such as a fire hitting interconnector capacity to France. It compares to 4.8GW, or 8.3%, last winter
Fintan Slye, Executive Directive of ESO, said: “The Winter Outlook confirms that we expect to have sufficient capacity and the tools needed to meet demand this winter. Margins are well within the reliability standard and therefore we are confident that there will be enough capacity available to keep Britain’s lights on.
In a separate winter gas outlook, National Grid said Britain has enough gas supply capacity to meet demand as well as gas in storage and tools available to manage times of acute gas demand.
Meanwhile, reports say Business Secretary Kwasi Kwarteng has asked the Treasury to support firms hit by rising energy costs which could see loans of hundreds of millions of pounds.
Ofgem Chief Executive Jonathan Brearley last week told an Energy UK conference that changes to regulation in the market were needed as he predicted more small suppliers would fail.
“We will need to regulate the energy market differently. When gas prices hit, many suppliers simply couldn’t cope with such a sharp, sustained shock,” he said.