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UK faces ‘tight’ energy supplies this winter, grid operator warns

The Electricity System Operator (ESO) has admitted that the UK’s electricity grid faces some “tight” periods this winter amid the ongoing pressures on energy prices.

In a report forecasting electricity availability this winter, the body said it expects system margins to be broadly in line with recent winters and there will be sufficient available capacity to meet demand.

But it added: “Our operational modelling indicates that there could be some tight periods this winter, which are most likely to occur in the first half of December.”

There are various uncertainties this winter as a direct result of possible shortfalls in Europe’s gas supply – partly driven by the turmoil around securing energy supplies from Russia.

Earlier this week, the Russian state-run energy firm Gazprom reduced flows through the key Nord Stream 1 gas pipeline to around 20 per cent of its capacity leading to concerns about energy security on the continent as demand rises heading into the winter.

The system margin calculation assumes that on the tightest days, the UK energy price will be higher than in Europe, causing interconnector flows into the country in response to market signals, which include scarcity prices, as they have done in previous winters.

But while Britain is not reliant on Russian gas to the extent that the rest of Europe is, “it is clear that the cessation of flows of gas into Europe could have knock-on impacts, including very high prices,” the report added.

The ESO is currently working closely with the Department for Business, Energy & Industrial Strategy, Ofgem and National Grid Gas Transmission to assess the potential scenarios that may arise and take steps to ensure that energy demand can be maintained.

“These steps include actions to build our resilience and mitigate the potential impact to electricity customers in Great Britain”, the ESO said.

As part of these efforts, it called for delays in the closure of five coal units which would deliver around 2 GW de-rated capacity. Four of the five units have now confirmed their availability.

The Department for Business, Energy and Industrial Strategy said: “As this report shows, the UK’s secure and diverse energy supplies will ensure households, businesses and industry can be confident they can get the electricity and gas they need.

“Britain is in a fortunate position, having access to our own North Sea gas reserves, imports from reliable partners like Norway, the second largest LNG (liquid natural gas) port infrastructure in Europe, and a gas supply underpinned by robust legal contracts.

“Thanks to a massive £90 billion investment in clean energy in the last decade, we have one of the most reliable and diverse energy systems in the world, and unlike Europe we are not dependent on Russian energy imports.”

Wholesale British gas prices hit record highs this year, following the Russian invasion of Ukraine. After already reaching its highest ever level in April, the energy price cap is expected to soar again in October by around 65 per cent.

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