With the clocks going back and the nights drawing in, once again it is time to assess the likelihood of the lights going out this winter. Each Autumn National Grid, the Electricity System Operator (ESO), publishes its annual Winter Outlook report – its own assessment of this issue. In the past few years, we have had Beasts from the East (BftE) and the North, the gas shock from the Ukraine War, the Great Texas Blackout and Blackout Friday on 9th August 2019 (the ESO advised that the system responded normally in cutting supplies to a million people). Have we learned anything and is our energy system now more resilient to these Black Swan events?
Exceptional Demand
Unsurprisingly energy demand reacts dramatically to weather events: an exceptional cold spell increases peak electricity demand from around 50 GW to 60 GW (ACS peak underlying demand), meaning the equivalent of 10 large power stations have to be found. For mains gas the increase is even more dramatic, from around 140 GW to over 200 GW (214 GW peak during the BftE). While average energy consumption has fallen in response to higher prices, we do not expect a similar reduction in cold weather driven peak demand.
Electricity Supply
To meet the estimated peak demand of 60,300 MW (58,500 MW peak demand plus 1,800 MW operating reserve) the ESO estimates that we will have 4,700 MW of nuclear, 37,000 MW of thermal, 12,700 MW of renewables, 4,000 MW from storage, 5,000 MW of interconnector supply from Europe and 1,200 MW from other sources. This gives a surplus of 4,400 MW, so in theory we can put away the candles.
However, we know that during the 2018 BftE the lights only stayed on because it was blowing a gale, so how would we fare during a winter wind drought (coined Dunkelflaute by the Germans)?
Nuclear: since 2018 we have lost nearly 3,200 MW of nuclear capacity, down from 9,200 MW to 6,075 MW today. The ESO derates the capacity by 22% to allow for outages, so the equivalent nuclear reduction is around 2,500 MW.
Coal: in 2018 we still had 10,200 MW of coal fired capacity, compared with 2,000 MW today. With the ESO’s derating of 20.7%, this is a loss of 6,500 MW of firm supply. Coal was particularly helpful in keeping the lights on during the BftE, both due to its large capacity and the fact that the fuel is stored on site, so there are no problems with distribution to the power stations, as could be the case with gas.
Biomass: some 1,250 MW of biomass (wood pellet fired) generation has been added since 2018, mainly by converting old coal units at Drax. Using the ESO’s derating factor, this gives us 1,100 MW of additional firm supply.
Gas: there has been a significant increase in gas fired generating capacity – some 5,000 MW installed, giving 4,700 MW of additional firm capacity. This is useful to make up the losses elsewhere, providing we have enough gas to generate electricity and heat our houses at the same time.
Storage: since 2018 we have added 4,700 MW of battery storage to the system, giving us an additional 2,500 MW of firm capacity. However, this storage needs to be re-charged, and in a prolonged wind drought we may not have enough electricity to keep the lights on, let alone top up the batteries.
Renewables: since 2018 we have added 1,500 MW of solar photovoltaic (PV) generation, and 8,100 MW of wind generation, together with 700 MW of hydropower. The hydropower is useful – it will probably be available when needed. One thing for certain is that the 14,700 MW of PV will not be generating at the time of peak demand on a winter’s evening. The ESO attributes an equivalent firm capacity factor of 15.6% to wind energy, meaning that the 28,200 MW of wind capacity is assumed to produce at least 4,400 MW of firm capacity at the time of peak demand. This is curious, as we know that wind output regularly falls below 2,000 MW, and sometimes below 1,000 MW. During a Dunkelflaute the lower figure seems more likely. During the BftE a strong easterly gale kept wind generation high; during a persistent winter anticyclone with its accompanying extreme cold, we will have very little wind generation.
Interconnectors: since 2018 we have added 4,800 MW of interconnector capacity with mainland Europe, bringing the total to 7,800 MW. There is also 1,000 MW of interconnection with the Irish Grid. 5,200 MW of this capacity has been contracted through auctions on the Capacity Market, and the ESO assumes that 5,100 MW of firm capacity is available from these interconnectors. Again, this is a bold assumption, bearing in mind that wind drought conditions may extend throughout northern Europe, leading to shortfalls in Europe at the same time as in Britain. When demand-supply imbalances start to impact the European Grid, interconnection operators are unlikely to be permitted to create further problems by exporting to Britain.
So how are we placed, relative to the 2018 BftE?
With exceptional cold weather demand likely to be similar to February 2018, we can focus on the supply side. We have lost 9,000 MW of reliable generation (2,500 MW of nuclear and 6,500 MW of coal). To balance this, we have gained some 8,100 MW of reliable generation (4,700 MW of gas, 1,100 MW of biomass, 1,600 MW of diesel and 700 MW of hydro). On top of this, we have gained 1,300 MW of wind, 2,500 MW of batteries and 3,000 MW of interconnection. On the face of it, we are much better placed than in 2018, but during a prolonged wind drought, we will be heavily dependent on gas – needing 34,000 GW of gas fired generation to supply 56% of the Dunkelflaute peak demand.
We are in slightly better condition in respect of gas supply than during the BftE, having re-opened the Rough gas storage facility. This has doubled the UK’s gas storage from 6 to 12 average days of consumption, or 3 to 6 days of peak (BftE levels) demand. Our import dependency has increased slightly, from 42% to 46%, but we have good LNG import capacity.
Gas supply tends to focus on energy (GWh) rather than power (GW), as our gas network has remarkable capacity to ramp up its power due to the volume of gas contained at high pressure in the pipeline network. In winter, gas demand frequently increases by over 100 GW between 5 am and 8 am, which is met by releasing gas stored overnight in the network. By comparison electricity demand seldom rises by more than 10 GW over a three-hour period. However, in very cold weather the ability to inject gas into the grid is tested, and eventually with more gas being withdrawn than injected, Mr Micawber’s principle prevails, and happiness turns to misery. During the BftE National Grid was forced to issue a Gas Deficit Warning (GDW), asking the market to increase supplies or reduce demand – this despite only 20% of electricity being generated from gas. Ofgem has solved this issue by re-naming the GDW as a Gas Balancing Notification – much less alarming.
So, during Dunkelflaute we will depend on gas for over 50% of our electricity generation, but during the BftE we had a GDW (“balancing event”) when only 20% of electricity came from gas. It seems obvious that if a prolonged wind drought occurs this winter, the grid will have to choose whether to supply gas to our homes for heating, or to use the gas to generate electricity. National Grid’s approach seems to be based on optimism: much like Mr Micawber, they assume that “something will turn up”.
So, when a Black Swan comes home to roost, the resilience of our whole energy system will be tested.
For more information, please contact:
Mike McWilliams, Chief Energy Adviser
Email: mike@mcw-e.com, Phone: 07941 302972
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