Power Prices Soar As National Grid Issues Capacity Market Notice

15 September 2020

Within day power prices today soared above £300 per megawatt hour within minutes of National Grid issuing a Capacity Market Notice.

At around 1pm, the Electricity System Operator said the system looked set to be short of capacity from 5.30pm. However, an hour later, the notice was cancelled.

The notice instructs generators to be ready to meet that shortfall so that the ESO can comfortably keep the lights on. The alerts system is automated, with notices cancelled as soon as the required capacity buffer is achieved.

However, coming on a warm September day, the warning illustrates the increasing challenge of running the grid, given the ESO in recent months has been paying generators to stop exporting power to the grid and this summer sought emergency powers to disconnect distributed generation due to very low demand on the transmission system.

Meanwhile flexible generators and traders able to react to the notice stood to enjoy a profitable Tuesday.

Source: The Energyst