Cornwall Insight comments on £51mn cost to balance the electricity system over the Bank Holiday

The Bank Holiday (23-24 May) saw the UK experience warm yet windy weather. Coupled with the significantly low levels of energy demand observed during the lockdown, it is no surprise that the level of activity from National Grid Electricity System Operator (ESO) to turn down generation was high.

As a result, the ESO said that the cost of balancing the system amounted to £51mn from 22-25 May, £23mn of which was attributed to 23 May. £7.3mn came from the ESO’s new Optional Downward Flexibility Management (ODFM) service, with the remainder coming from the Balancing Mechanism (BM) and Trading Costs. The below graph is taken from Cornwall Insight’s Balancing Mechanism Service and highlights the output turned down on Saturday 23 May via the BM.

A graph showing bid-offer volumes in the balancing mechanism

Tim Dixon, Wholesale Team Lead at Cornwall Insight, said:

“Amid ongoing lockdown measures, demand for power in GB remains low and continues to weaken as the UK heads towards the summer months. Demand on the transmission system fell to 14.5GW (excluding demand from interconnectors and power stations) in settlement period 12 on 24 May. This is the lowest level of transmission demand seen at any point in the last 15 years (as far back as Grid data was available).

“Accompanying low demand was high levels of transmission connected wind generation, which peaked at 10.8GW on 23 May and averaged 6.8GW over the extended weekend. However, without actions from the ESO to turn down wind generation (via the BM and commercial trades), output was expected to exceed 14GW.

“The Bank Holiday weekend also saw embedded wind generation peak at 3.7GW and solar output peak at 8.7GW, reducing demand on the transmission system. Across the weekend transmission system, demand averaged 18.8GW and peaked at 24.7GW. For context, the same Bank Holiday last year saw minimum, average and maximum demand at 16.6GW, 22.5GW and 28.7GW respectively.

“With demand flooring at 14.5GW, this posed significant operational challenges for National Grid ESO. In response, the ESO was required to turn down significant volumes of asynchronous generation via the BM, but also via its new ODFM service.

“Via the BM, National Grid ESO accepted a total bid volume (i.e. to turn down output) of 238GWh from wind farms between 22-24 May and an extra 70GWh from other technologies. In contrast, and to help maintain adequate levels of system inertia, 229GWh of offer volumes (i.e. to turn up output) were accepted from synchronous gas-fired generation over the equivalent period.

“The ODFM service – used to turn down embedded generators otherwise not active in the BM – was utilised on three days across the weekend. Cornwall Insights estimates this amounted to 42.3GWh.”