Energy minister 'fully behind' National Grid

 

Michael Fallon: "I can assure you, the lights are not going to go out"

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The government says energy minister Michael Fallon is "fully behind" a National Grid consultation that could see big businesses paid to cut their energy usage in times of shortage.

Last night Mr Fallon appeared to dismiss the proposal in an interview on the BBC's Newsnight programme.

It followed a warning from energy regulator Ofgem that the risk of power cuts has increased in the UK.

Despite that the government has emphasised "the lights won't go out".

Electricity network owner National Grid has suggested large consumers, such as big shops and factories, could be asked to lower use between 16:00 and 20:00 on weekdays in the winter.

Ofgem also suggested keeping some mothballed power plants in reserve in case of emergencies.

"This does not mean that disruption is imminent or likely, but Ofgem, [the Department of Energy and Climate Change] and ourselves believe it appropriate to consider what measures could be taken in case margins deteriorate further," National Grid said.

In a statement, DECC said Mr Fallon "is fully behind Ofgem and National Grid's consultations which are about whether they should take the prudent step of extending their existing services in the context of possible tightening in the supply margin in the middle of the decade".

Analysis

Can it be right to ask businesses to close to keep the lights on for the rest of us? That's what is being proposed by National Grid.

There is no compulsion. No rationing. Instead medium and large firms will be paid to reduce their electricity demand.

The National Grid says this would be a last resort to be used on winter evenings when temperatures plunge and demand soars.

It is also proposing to pay some electricity generators to keep mothballed plants ready to provide power. The Grid accepts that these new provisions sit outside its "usual system operator role" and are likely to modestly increase household bills.

But some industrial users may reflect that if the only way to keep the lights on is to shut down factories and businesses then government energy policy can't be working.

'Lights stay on'

"One option, if the need arose, would be for companies to voluntarily enter into agreements to fire up currently mothballed power stations or for large users to reduce their demand, in return for which they would receive payment," it said.

"This is an extension of what already happens in the power market. There is no compulsion and it is not rationing.

"We are confident that, with Ofgem and Grid having all the tools at their disposal, the lights will stay on."

In an interview on Newsnight, Mr Fallon appeared to dismiss the idea of paying big users to cut back.

When asked if there was any truth to reports that big factories and businesses would be asked to cut their energy use in 2015, Mr Fallon replied: "No".

"The latest [Ofgem] assessment has shown that the position is slightly worse than the previous assessment last year.

"The regulator Ofgem has got to make sure, with all the tools at its disposal - bringing some mothball plant back in action and back on line - that the lights stay on and they will."

In an assessment released on Thursday, Ofgem said spare electricity production capacity in the UK could fall to 2% by 2015, increasing the risk of blackouts.

The watchdog said more investment in power generation was needed to protect consumers.

It said: "Ofgem's analysis indicates a faster than anticipated tightening of electricity margins toward the middle of this decade."

The global financial crisis, tough emissions targets, the UK's increasing dependency on gas imports and the closure of ageing power stations were all contributing to the heightened risk of shortages, Ofgem said.

 

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  • rate this
    +1

    Comment number 694.

    One of the most important aspects is age. The UK like so many other early industrialized nations have extremely old power grids going back nearly 100 years. When Hurricane Sandy hit the NY area in the US the grid that was destroy was over 100 years old in parts because NYC was the first city to be powered by electricity. The older the grid the more complex it becomes. This makes it hard to update

  • rate this
    +3

    Comment number 690.

    Lighting apart, everywhere (shops, businesses, schools) could easily survive with a 1 degree drop in room temperature - might even be beneficial to health and concentration. However first place to start - airports - always about 5 degrees too hot.

  • rate this
    +6

    Comment number 553.

    We certainly need to get smarter on our use of electricity. For example the company I work for (400+ PCs in my location alone) insist that our PCs are left on overnight and weekends "for IT security updates". Power stations can't just turned on and off so this just adds to the peak load requirement which has to be met, which is a horrendous waste.

  • rate this
    +26

    Comment number 510.

    Too much reliance on North Sea Gas has made previous governments lazy and as usual not thinking ahead. Discussion of energy requirements has been around for years and now we will be reduced to panic measures. Allowing our utilities to be taken over by foreign companies was the worst idea ever. What a crazy way to run a country!!

  • rate this
    +12

    Comment number 495.

    relying on energy from companies that are owned by foreign govts is a major weakness in the national security of the entire island of the britain. energy is a global commodity so britain needs to find a ready supply, cheap, and fast, or its lights out for good. welcome to the true face of capitalism where half your salary will soon disappear in utility bills.

 

Comments 5 of 12

 

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