No emergency coal-fired power for National Grid to keep lights on this winter
The National Grid Electricity Systems Operator (ESO) has confirmed it will have no coal-fired power as back-up this winter, if needed, to help keep the lights on.
There were five contingency units to call on last winter as the energy market reeled from the impact of Russia’s war in Ukraine.
They were warmed up several times and used during March when a cold snap hurt wind generation.
The ESO had said earlier this month, at the publication of its early winter outlook report, that it remained in talks with EDF and Drax about keeping their coal-fired generation on its standby contracts.
But it said on Wednesday: “At the request of government in March 2023, the ESO has undertaken discussions with the operators of two winter 2022/23 contingency coal plants to establish whether these arrangements could be extended for a further winter.
“These discussions have now concluded. Both operators have confirmed that they will not be able to make their coal units available for a further winter and have begun the decommissioning process.”
That process was down to government policy.
It had said that by October 2021, all coal-fired power units were to have been shut as part of the country’s ambitions to tackle climate change.
The remaining unit, Uniper’s Ratcliffe-on-Soar power station, will be the only one left functioning.
But It has a so-called capacity market contract, meaning it will supply electricity to the grid like any other provider this winter.
The unit had been solely available to the ESO, if required, during 2022/23.
Two units at EDF’s West Burton A power station have been closed as planned.
The two at Drax are set to be converted to biomass generation.
The lack of contingency back up is likely to alter the ESO’s outlook for the winter ahead.
Its earlier report expected sufficient capacity to meet demand after the turmoil leading up to 2022/23 when gas flows from Russia were stopped, sparking a scramble for supplies on the continent.
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But it added that it was “prudent to maintain” the demand flexibility service (DFS), which was introduced in 2022.
The DFS, which was activated for the first time in January after a series of tests and false alarms, sees volunteer households paid to turn off their main appliances at times of peak demand.
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The UK played a pivotal role in helping supply the continent with gas ahead of last winter amid a race to fill storage and stop the lights going out given historic dependency on Russian gas, particularly in Germany.
Britain, however, tends to import electricity from its North Sea neighbours during the winter months.
A relatively mild 2022/23 winter, coupled with alternative supply, meant Europe ended last winter with a record volume of gas in storage.
The report said of Britain’s electricity output: “We expect there to be sufficient operational surplus in our base case throughout winter.”
While the ESO was confident on the capacity issue, market experts still expect gas and electricity costs to go up over the colder months as demand spikes.
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Energy price cap reduction explained
It could mean that household bills, through the energy price cap, start to rise again.
The cap kicks in again from July following the end of the government’s energy price guarantee that limited the wholesale prices that consumers faced.
The level of the cap, at just above £2,000 for the average annual bill, is well down on the £2,500 estimate under the guarantee.
Four people have been arrested by police investigating cyber attacks targeting M&S, Co-op and Harrods.
A 20-year-old woman and two males, both aged 19, and a male aged 17, were detained in London and the West Midlands this morning as part of a National Crime Agency (NCA) operation.
They were arrested at their homes on suspicion of Computer Misuse Act offences, blackmail, money laundering and participating in the activities of an organised crime group.
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Electronic devices were seized from the suspects and are currently being analysed by forensic experts.
M&S halted online orders, and shelves were empty in shops after the cyber attack on the retailer earlier this year.
The initial hack into the retailer’s systems took place in April through “sophisticated impersonation” involving a third party.
Disruption is expected to continue at the retailer until the end of this month.
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The Co-op and Harrods were also subsequently targeted by hackers.
Paul Foster, head of the NCA’s National cybercrime unit described the arrests as a “significant step” in their investigation, which remains “one of the Agency’s highest priorities”.
He added: “…our work continues, alongside partners in the UK and overseas, to ensure those responsible are identified and brought to justice.”
The National Crime Agency is keen to “signal” to “future victims” the “importance of seeking support and engaging with law enforcement”, stating that “the NCA and policing are here to help”.
The NCA has also thanked M&S, Co-op and Harrods for their support in their investigations.
The arrests, which took place early on Thursday morning, were supported by officers from the West Midlands Regional Organised Crime Unit and the East Midlands Special Operations Unit.
Earlier this week, the chairman of M&S told MPs that the hack had been “traumatic” and like an “out-of-body experience”.
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Archie Norman, however, refused to be drawn on whether the retailer had paid any ransom.
“We are not discussing any of the details of our interaction with the threat actor, including this subject, but that subject is fully shared with the NCA,” he said.
It is estimated that the cyber attack will cost M&S up to £300m this year.
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Days after M&S was attacked, the Co-op was targeted and forced to shut down some internal systems.
Harrods was then hacked, and also had to shut some systems despite its website and shops continuing to operate.
Of those arrested, a 17-year-old British male and a 19-year-old Latvian male were from the West Midlands.
A 19-year-old man was from London and a 20-year-old woman from Staffordshire.
Royal Mail is to be allowed to scrap Saturday second-class stamp deliveries, under a series of reforms proposed by the communications regulator.
From 28 July, Royal Mail will also be allowed to deliver second-class letters on alternate weekdays, Ofcom said.
The post will still be delivered within three working days of collection from Monday to Friday.
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The proposals had already been raised by Ofcom after a consultation was announced in 2024, and the scale back was proposed early this year.
Royal Mail had repeatedly failed to meet the so-called universal service obligation to deliver post within set periods of time.
Those delivery targets are now being revised downwards.
Rather than having to have 93% of first-class mail delivered the next day, 90% will be legally allowed.
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The target for second-class mail deliveries will be lowered from 98.5% to arrive within three working days to 95%.
A review of stamp prices has also been announced by Ofcom amid concerns over affordability, with a consultation set to be launched next year.
It’s good news for Royal Mail and its new owner, the Czech billionaire Daniel Kretinsky. Ofcom estimates the changes will bring savings of between £250m and £425m.
A welcome change?
Unsurprisingly, the company welcomed the announcement.
“It is good news for customers across the UK as it supports the delivery of a reliable, efficient and financially sustainable universal service,” said Martin Seidenberg, the group chief executive of Royal Mail’s parent company, International Distribution Services.
“It follows extensive consultation with thousands of people and businesses to ensure that the postal service better reflects their needs and the realities of how customers send and receive mail today.”
Citizens Advice, however, doubted whether services would improve as a result of the changes.
“Today, Ofcom missed a major opportunity to bring about meaningful change,” said Tom MacInnes, the director of policy at Citizens Advice.
“Pushing ahead with plans to slash services and relax delivery targets in the name of savings won’t automatically make letter deliveries more reliable or improve standards.”
Acknowledging long delays “where letters have taken weeks to arrive”, Ofcom said it set Royal Mail new enforceable targets so 99% of mail has to be delivered no more than two days late.
Changing habits
Less than a third of letters are sent now than 20 years ago, and it is forecast to fall to about a fifth of the letters previously sent.
According to Ofcom research, people want reliability and affordability more than speedy delivery.
Royal Mail has been loss-making in recent years as revenues fell.
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In response to Ofcom’s changes, a government spokesperson said: “The public expects a well-run postal service, with letters arriving on time across the country without it costing the earth. With the way people use postal services having changed, it’s right the regulator has looked at this.
“We now need Royal Mail to work with unions and posties to deliver a service that people expect, and this includes maintaining the principle of one price to send a letter anywhere in the UK”.
Ofcom said it has told Royal Mail to hold regular meetings with consumer bodies and industry groups to hear their experiences implementing the changes.
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