Coal power plants could be paid to generate more electricity, with consumers and businesses paid to use less, as the UK hunkers down for a winter of gas shortfalls across Europe caused by the standoff with Russia over the war in Ukraine.
In its early outlook forecasting Britain’s ability to keep the lights on over winter, the National Grid admitted there could be “tight periods” in early December, which would trigger a call for power plants to ramp up generation.
While the grid expects to be able to maintain the buffer that prevents blackouts, it issued a warning about the potential impact of a shortfall in Russian gas supply into Europe.
It came as Moscow reduced flows through the Nord Stream 1 pipeline, sending wholesale gas prices soaring and leading to predictions that household energy bills could hit £3,850 next year and remain above £3,500 into 2024.
The UK is much less dependent on Russian gas than European countries such as Germany but National Grid said shortfalls across Europe were likely to lead to “very high” prices for the gas that heats homes on cold days and generates electricity.
In preparation for turmoil in the energy markets, it has asked five coal power units to be available to supply power to the grid but not to the wider electricity market. It said EDF and Drax, which own four of the five, have already agreed to do so, but did not disclose the fifth.
The agreement follows government negotiations with French state-owned energy firm EDF, over its West Burton A plant in Nottinghamshire, as well as with Drax over its plant in Yorkshire.
National Grid is also looking at how to reduce demand, which could involve industrial users being paid to reduce their power usage.
It could also trigger a scheme trialled earlier this year under which customers of household energy supplier Octopus Energy would be paid to put off using the dishwasher or delay a laundry cycle until after peak demand times.
In addition, the electricity system operator will work with the owners of transmission networks to reduce maintenance outages, or time them to cause less disruption.
Jess Ralston, senior analyst at the Energy and Climate Intelligence Unit (ECIU) thinktank, said: “We may well get through the winter without major incident but the gas bill at the end will likely be extortionate.
“With calls for the £15bn winter energy package [to support domestic billpayers] to be expanded, the government will be kicking itself for not having invested more in energy efficiency over the years.
“The high cost of gas will be adding £2,000 to bills from October, but this could rise with Putin already turning down the flow to Germany.”
