The UK is facing a capacity crunch in its electricity market. In essence within a few years, around 2016, the available supply of electricity in winter, when demand peaks, may be dangerously close to demand. Blackouts may result. The situation is reasonably summed up by this graph from Ofgem. Basically we are going from about 13% to 5% excess capacity in the next three years. (The base case is the one to look at. Juice normally comes down the line from France, but if it’s very cold in France then they need to power their electric heaters, so some times there won’t be much, if any, power coming from France)
Exactly how tight this crunch will be is open to debate, and I am not going to going to discuss that here. However let’s consider an option that has been put forward: re-opening mothballed gas plants. This apparently is being considered by the government. Naturally media reports on this don’t care to mention just how much mothballed capacity is available. These figures aren’t easily available, however a report by Credit-Suisse from mid-2012 indicates that there are 4 plants mothballed, with a total capacity at just over 4.1 GW, that is roughly 7% of the total UK capacity.
Let’s say we restart all of this stuff right now, how does the capacity situation change? To see this consider another graph from Ofgem that shows how they project capacity to change in the next few years, and its relationship with the capacity margin. (Note: the large drop in coal power is mostly due to an EU directive, and these losses are pretty much guaranteed.)
So, restarting these plants could push the capacity margin from about 5% to above 10%. What are the prospects of re-opening these plants?
Keadby, Medway at 1.4 GW appears to be likely to be re-opened if the incentives are high enough. However SSE is currently reluctant to re-open it due to the weak financial situation for gas plants.
The position of Teeside (1.8 GW) is unclear. However the bosses of the plant claim to be keeping the option of un-mothballing it open in case of improved conditions. The situation for the other two power plants appears to be similar. So if the government is willing to toss these power plants enough money, quite possibly in the form of capacity payments, the UK’s capacity crunch may be a lot less tight.