National Grid reassures consumers amid blackout claims

The company states that electricity margins are manageable and gas supplies are expected to be comfortable, while also conceding that the gap between supply and demand would have been just 1.2 per cent if recent emergency measures hadn’t been taken.

The Winter Outlook Report for 2015/16 confirmed that the company has secured additional balancing services of 2.4GW for the winter period that will be available to manage periods of peak demand.

The report mirrors predictions made in July that the country’s energy supplies should be sufficient, despite several closures to power plants in recent months.

Many experts had predicted this announcement, a view that contrasts recent headlines warning of country-wide blackouts; however a number of firms still believe improvements to the Capacity Market need to be made.

Richard Warren, Senior Energy Policy Adviser at EEF, thinks yesterday’s report should be no great cause for alarm.

He said: “The expected 5.1% margin for the coming winter compares favourably with margins earlier this decade, and the double figure margins that emerged following the financial crisis are really the exception rather than the norm.

“We remain confident that the short term measures National Grid has been equipped with will continue to provide us with the necessary cushion.

“In the longer term, it is imperative that the Capacity Market starts to deliver the right signals to investors to bring forward new build gas plants.”

Tanuja Randery, President of Schneider Electric UK & Ireland, argues Investment in renewable energy must be encouraged as a means of avoiding future energy crunches.

She said: “Just 9.5% of the UK’s electricity was generated by onshore and offshore wind in 2014, but much more green energy production is possible.

“Cuts to subsidies and the curtailment of significant renewable energy projects need to be reviewed, and quickly."

Dorian Lucas, energy analyst at Inenco, states that the capacity margin predicted by National Grid is not a surprise to the market, but warns that large businesses will play a fundamental role in keeping the system balanced for the first time.

He said: “The continued downward trend in forward market prices is testament to the fact few believe we will struggle with security of supply this winter.

“However, big businesses will have to help to boost a 1.2% margin to 5.1%.

“Demand side schemes have been put in place to incentivise major energy users to respond to tighter margins and these should be more than adequate to maintain supply during peak winter periods and to counter unexpected plant outages.”