National Grid PLC (LSE:NG.) confirmed it has been in talks with coal power producers to help keep the lights on this winter, as Russia prepares to cut gas supplies through the Nord Stream 1 pipeline to the continent.
In the grid operator’s winter outlook for this coming 2022/23 winter season, published this month, it confirmed that it would delay closures at four or more coal plants this winter.
“There are risks and uncertainties this winter as a direct result of possible shortfalls in Europe’s gas supply,” National Grid said in the report.
“As noted elsewhere, 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.”
Faced with the current energy crisis, the UK government temporarily reneged on its commitment to close power plants by October 2024 this spring when business and energy secretary Kwasi Kwarteng began discussions with coal power producers to reopen plants.
National Grid said four out of five coal units it has approached to postpone decommissioning have confirmed their ability to continue producing power this winter season.
The electricity system operator has been working with the Department of Business, Energy and Industrial Strategy to postpone the closures of up to five coal units.
Doing so would deliver 2 GW of de-rated capacity, National Grid said. That output would not be available to the market directly, and is additional to its base case margin, the grid operator said.
The added capacity will aid in meeting average UK peak demand of 59.5 GW during the cold spell this winter, which includes a 1.2 GW operational reserve, National Grid said.
“We base this on our latest view of daily peak demand and the latest view of plant outages from REMIT,” it said. “It does not currently include coal units that were due to close ahead of this winter.”
The grid operator said it is also exploring options to incentivise greater demand-side response and is working with transmission owners to “minimise the impact of network outages this winter”.
Interconnectors are able to provide 5.7 GW of net imports when the UK needs it, consistent with capacity market obligations, it added.
The Baglan Bay, Severn Power and Sutton Bridge combined cycle gas power plants are expected to remain open this winter, based on public announcements.
Now that Eleclink is operational and IFA subsea interconnector and the North Sea Link are operating at full capacity, National Grid is assuming there will be 2.7 GW of additional interconnector capacity that was not available last winter.