The Department for Business, Energy Industrial Strategy (BEIS) is calling on the National Grid Electricity System Operator (ESO) to explore options to bolster energy security in Britain over the coming winter.
The letter from Business and Energy Secretary Kwasi Kwarteng comes in light of Russia’s invasion of Ukraine which has resulted in the “significant possibility of disruption” to Russian gas supplies to Europe.
He states while the UK is not dependent on gas from Russia, a shortage of gas in Europe could put considerable pressure on the European gas market and suppliers of liquefied natural gas (LNG), with the potential for additional, consequential impact on electricity markets.
Mr Kwarteng suggests National Grid ESO to “significantly increase” the amount of capacity available over the winter, particularly non-gas-fired capacity, that would otherwise not be available.
That includes certain coal plants that have been identified by BEIS.
The business and energy secretary states: “Any frameworks agreed will need to ensure system stability and enable the providers to be reliably available over the winter and for them to have the potential to generate significant amounts of electricity should this be needed to ensure security of electricity supplies. And consistent with your applicable criteria, any agreement would have to deliver value for money to electricity consumers. To this aim, you may wish to consider the high levels of uncertainty and volatility expected in energy markets over the winter.
“Finally, I would encourage that any frameworks are put in place swiftly – to enable operators to make time critical decisions – and in a manner that minimises any wider impacts on our electricity markets as far as is practicable.”
Mr Kwarteng insists he remains committed to the government’s coal generation closure deadline of September 2024 and deadline for phasing out Russian coal imports by the end of the year.