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National Grid calls for companies to reduce power usage

The National Grid has, for the first time, resorted to their emergency powers to instruct companies to reduce their electricity usage in an attempt to avoid blackouts.

The scale of Britain’s energy supply crunch was uncovered on Wednesday, after an unexpected outage of power plants sent electricity prices soaring.

Traders saw prices surge to £2,500 per MWh (megawatt hour) for Severn Trent Power, whereas the usual rate is around £60 [1].

National Grid issued an urgent request for heavy users such as factories, hospitals and businesses, to reduce their usage to offset the dip in supply.

Power firms were asked to supply an extra 500MW (megawatts), after multiple breakdowns at UK power stations between 4.30pm and 6.00pm, to cope with the daily demand surge of people arriving home from work. This request was sent by sending a “notification of inadequate system margin” (NISM), a warning that there was not enough power in reserve to keep the lights on in the event of an unforeseen emergency [2].

Energy analysts at stockbroker Jefferies have noted that it could be a sign of system stress as coal-fired power stations close. “It is self-evident that the UK power system is under increasing stress. Eventually that stress will manifest itself via security-of-supply events” [2].

The disruption will add to fears that a particularly chilly winter could trigger power cuts, leaving people in the cold.

This puts further pressure on David Cameron following his subsidy cuts from the renewables industry earlier in the year.

 

[1] Financial Times. ‘UK’s high-wire act on power supplies laid bare’. ft.com

[2] The Guardian. ‘National Grid in urgent call for companies to reduce electricity usage’. theguardian.com