National Grid will activate an emergency winter plan tomorrow following French nuclear outages

After energy prices rose amid falling temperatures, the UK’s electricity network operator is ready to activate its emergency snow plan.

National Grid suggested that it might announce Monday afternoon that it would require consumers to use its new demand flexibility service starting Tuesday. This reward system rewards households and businesses that reduce their energy usage during peak demand times.

The concern expressed by energy specialists is that Britain’s power system could be endangered by low temperatures, which increase demand; still, whether that reduces wind power or slows returns of several French nuclear reactors. These reactors have been down for maintenance.

Although the flexibility scheme of the National Grid has been tested, this will be the first time that it is being used to reduce grid pressure. The service will be available to hundreds of thousands of households. It was officially launched in October after a trial with Octopus.

The service is only available to smart meter owners whose suppliers have signed up. Despite the fact that many have signed up, they are mostly domestic or business providers, the two largest UK suppliers, British Gas, and E.ON, have joined.

On Monday morning, gas and electricity prices shot up after the Met Office issued yellow warnings about bad weather over the weekend. Some forecasters suggested that cold temperatures in Russia could reach the UK next month in an echo of the 2018 “beast of the east” snowstorms.

Next-day delivery gas prices rose to 260p from 153p on Friday night. The wholesale power prices in the UK rose to £400 per megawatt hour, an increase of about £150 MWh from last week. According to data from EnAppSys, prices for tomorrow on the N2EX (the trading place for power), hit £1066 per MWh.

Live data from National Grid’s electricity network operator (ESO), showed that 60% of Britain’s electricity was generated by gas-fired power stations, 11% from nuclear, and 7% each from wind power, imports, and undersea cables from France, Norway, and other countries.

Ministers were criticized for not including gas-fired generators in the windfall tax that was announced this month.

This sharp price rise is due to increased concerns about the security of Britain’s energy supply since Russia invaded Ukraine.

National Grid warned that in October, a combination of events (Russia cutting gas supplies to Europe, and a cold spell) could cause three-hour power outages.

Ministers tried to boost energy supplies by taking a variety of measures, including signing agreements to keep coal-fired power stations on standby throughout the winter.

Russia’s weaponization of gas supplies has caused a rush for gas this year, as European countries rush to stock up on gas. The positive developments in recent months and mild weather over recent weeks have increased the confidence that Britain will be able to meet its energy requirements this winter.

National Grid warned last week of an imminent electricity shortage and then cancelled it immediately. According to industry sources, it was just a market mechanism since electricity supplies from Europe were sufficient to meet the increased demand.

Tony Jordan, a senior associate at Auxilione said that consumers shouldn’t be worried about the immediate threat from power outages. He said that spot prices have been rising due to the cold weather. The last few months have been warm so the sudden price rise will be quite a shock for companies.

“But this is the way the system works. It will convince people to cut back on their consumption and balance out demand and supply. Although there will be some scaremongering, it seems like we should be okay.”

Martin Young, an analyst at Investec, stated that National Grid has several options for dealing with potential shortages. He said that the ESO had several tools and added more this winter to ensure the security of supply.

“Just because it’s windy doesn’t mean that there is cause to be concerned. To be able to worry about power interruptions, there must be more than one thing going on.

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