Energy crisis: Plan for three-hour power blackouts to prioritise heating in event of gas shortages – as EU agrees to cut electricity use
The country has been put on notice that the chances of gas shortages this winter have risen markedly, prompting a contingency plan to prioritise heating.
National Grid’s Electricity System Operator (ESO) warned that planned three-hour power blackouts could be imposed in some areas, in the “unlikely” event supplies of gas fall short of demand.
It revealed the measure in an update on the UK’s state of energy readiness for the cold months ahead but it said that the risk of temporary power cuts could be avoided with help from the public.
The report showed, under a base case scenario, that margins between peak demand and power supply were expected to be sufficient and similar to recent years thanks to secure North Sea gas supplies, imports via Norway and by ship.
It comes as EU countries formally agreed to a voluntary 10% cut in gross electricity consumption and a mandatory reduction of 5% during peak hours – in what have been labelled “extraordinary measures”.
The European Council said: “Member states will identify 10% of their peak hours between 1 December 2022 and 31 March 2023 during which they will reduce the demand.
“Member states will be free to choose the appropriate measures to reduce consumption for both targets in this period.”
The ESO urged households to help manage that balance by signing up to an energy-saving scheme through their supplier, in a bid to help ease the risk of the lights going out.
The “demand flexibility service”, due to start next month, will see bill-payers be paid to save energy during peak hours.
Coal generators, that the operator said would have otherwise closed, will be used to maintain supply. In an effort to generate enough power to supply 600,000 homes the ESO is securing contracts with three generators to keep five coal units open and on standby.
A separate study by National Grid Gas Transmission, which is a separate business to the ESO, saw the potential for the shortfall in gas supplies within continental Europe – as a result of Russia’s war in Ukraine – to impact the UK’s usual ability to attract imports.
It suggested gas needed to power the UK’s electricity grid was expected to rise by nearly 22% – offsetting savings from lower household and business use – largely because of a need for power in France where many nuclear plants are offline.
It saw LNG (liquefied natural gas) from the US and Qatar acting as the new primary source of supply flexibility.
Gas accounts for over 40% of UK power generation – more if the wind fails to blow and other plants are offline for maintenance.
The ESO’s report marked a darkening in the prospect for disruption in the months ahead following a comparatively rosy early view report in July.
Please use Chrome browser for a more accessible video player
Risk of emergency gas shortage
There was a clear sign of a shift in direction earlier this week when it emerged that the energy regulator Ofgem had warned of a “significant risk” of a gas supply emergency.
It blamed the international scramble for supplies because of the war, which has starved continental Europe of its main source of natural gas.
On Thursday, Prime Minister Liz Truss refused to reiterate a promise she made during the Tory leadership election that there will not be blackouts this winter.
Pushed to repeat that promise, she told reporters in Prague: “Well what we’re clear about is we do have a good supply of energy in the UK, we’re in a much better position than many other countries.
“But of course there’s always more we can do.”
A gas supply emergency can be declared when suppliers are unable to safely get gas to homes and businesses.
It could mean that some customers, starting with the largest industrial consumers, will be asked to stop using gas for a temporary period.
The aim would be to keep gas and gas-generated electricity supplies stable for households for as long as possible.
For the electricity market, coal-fired power stations can be brought back online under what is known as a system notice to help fill stopgaps. This has traditionally happened when nuclear plants go offline or the wind fails to blow.
The hope is that these sorts of measures will not be necessary because of the looming demand flexibility service.
It is expected to be implemented at least 12 times, whatever happens, from November to March to ensure a benefit for signatories.
The ESO’s director of corporate affairs, Jake Rigg, said: “If you put your washing machine or other electrical appliances on at night instead of the peak in the early evening, you can get some money back when we all need it.”
Energy bills have rocketed this year but now come under the protection of government caps on wholesale costs, shielding both households and businesses from the worst in the price surge ahead of winter.
It means the taxpayer will foot the bill for wholesale prices above the unit cap level.
The scheme does not cap your bill, which will continue to depend on the amount of energy used.
An Ofgem spokesperson said of the National Grid reports: “We have one of the most reliable energy systems in the world and we are in a favourable position.
“However, it is incumbent on a responsible and prudent energy sector to ensure the right contingency measures are in place, which is why we are working with the government, National Grid and key partners to protect consumers, so that Great Britain is fully prepared for any challenges this winter.”
Black Friday sales do not appear to have provided much cheer for retailers amid continued consumer caution, according to official figures.
The Office for National Statistics (ONS) reported a 0.1% decline in sales volumes during November, compared to the previous month, when the data is adjusted for seasonal effects due to the pre-Christmas shopping bonanza falling in December last year.
Economists polled by the Reuters news agency had expected growth of 0.4%. The dip was worse when the effects of fuel sales were excluded.
Rolling three-month data showed positive sales volumes were only propped up by strength in September.
Money latest: The graduates who may want to pay off their student loan early
ONS senior statistician Hannah Finselbach said: “Retail continued to grow in the three months to November, helped by a strong performance from clothing and tech shops.
“This year November’s Black Friday discounts did not boost sales as much as in some recent years, meaning that once we adjust for usual seasonality, our headline figures fell a little on the month.
“Meanwhile, our separate household survey showed that although some people said they were planning to do more shopping… this Black Friday than last, almost twice as many said they were planning to do less.”
The data was released against a backdrop of widespread consumer and business caution in the run-up to the budget on 26 November – held just two days before Black Friday – although promotional activity was already well underway before Rachel Reeves’s speech.
That period was dominated by on-off signals over income tax hikes and black holes in the public finances, but the budget itself largely backdated many of the most painful measures towards the end of the parliament.
While the ONS data does little to boost retailers’ expectations for the Christmas season, there was a crumb of comfort to take from a closely-watched survey released just beforehand.
GfK’s consumer confidence index nudged up to its joint-highest level this year – though it remained deep in negative territory.
The biggest upwards contribution came from a willingness to make major purchases, despite perceptions for personal finances weighing amid continuing cost-of-living pressures in the economy.
Neil Bellamy, GfK’s consumer insights director, said: “Consumers resemble a family on a festive winter hike, crossing a boggy field – plodding along stoically, getting stuck in the mud and hoping that easier conditions are not far off.”
We have had better economic news since the survey was completed.
It was revealed this week that a much larger decline in the rate of inflation, to 3.2% from 3.6%, had allowed the Bank of England to cut interest rates to 3.75%.
It promises a boost to spending power as borrowing costs come down further, with wage growth still rising above that pace for price growth.
It is now hoped that the end of the budget circus will spark some life into the economy following two consecutive monthly contractions for output and a surge in the unemployment rate.
Much of the increase has been attributed to the retail and hospitality sectors reacting to sharp rises in employment costs under the Labour government.
Consumer spending accounts for around 60% of the UK economy.
Richard Carter, head of fixed interest research at Quilter Cheviot, said of the outlook: “Markets do not believe growth is coming to the UK anytime soon.
“Indeed, the UK is likely to slip into recession if the latest GDP figures are anything to go by, and there is little sign of positive momentum being generated.”
-
Sports2 years agoStory injured on diving stop, exits Red Sox game
-
Sports3 years ago‘Storybook stuff’: Inside the night Bryce Harper sent the Phillies to the World Series
-
Sports2 years agoGame 1 of WS least-watched in recorded history
-
Sports3 years agoButton battles heat exhaustion in NASCAR debut
-
Sports3 years agoMLB Rank 2023: Ranking baseball’s top 100 players
-
Sports4 years ago
Team Europe easily wins 4th straight Laver Cup
-
Environment3 years agoJapan and South Korea have a lot at stake in a free and open South China Sea
-
Environment1 year agoHere are the best electric bikes you can buy at every price level in October 2024