Millions of British households are expected to struggle with their energy bills this winter.
Issues with gas supplies have been well-documented over the past year following Russia’s invasion of Ukraine. Higher energy prices have started to be felt across the country, even with the introduction of the energy price guarantee.
Once this is reviewed in March, energy consultancy Cornwall Insight predicts the average consumer will pay £3,702 a year.
Unfortunately that’s not where the problems end. Issues of supply are starting to mount ahead of a cold winter, leading to concerns the UK could face blackouts this winter and evoking memories of the 1970s.
National Grid has warned there could be blackouts for up to three hours at a time this winter if supplies run low
Why is the UK at risk of blackouts this winter?
National Grid has warned households could lose power for up to three hours at a time this winter if supplies run really low.
This is mainly due to the emergency measures taken after Russia’s invasion of Ukraine.
While the UK is less reliant on Russian gas than Continental Europe, the squeeze on supplies will start to intensify the pressure on the UK power grid because of the lack of gas storage.
Although the UK has been exporting gas since late Spring to help European countries, the continuing lack of gas storage means there is a reliance on imports in the colder months.
Gareth Kloet, energy spokesperson for GoCompare says: ‘About a third of our electric supply has come from the burning of gas in the past. So when it’s restricted, like it is now, it becomes very expensive.
‘We really have got an electricity problem because we will struggle to meet our peak demand periods. I don’t want to sound overly alarmist… at this time of the year it’s not a problem, but when we get a real peak, that could be problematic. That’s why people are talking about blackouts.’
Gas isn’t the only source of energy supply as the UK also has offshore wind capacity, but relying on the weather makes forecasting much harder.
‘If demand outstrips supply you’ll start to see power cuts. Then the question is how quickly you can bring back the supply in order to give enough people their energy,’ says Kloet.
‘If we have a very cold winter, it will put a lot of demand on the system… A lot of people are still working from home, people will want to heat their homes much more than before the pandemic. It’s a lot of demand… [but] this will only really happen if we have a very cold winter.
‘The perfect storm would be a Monday morning on a cold day. You’d have lots of demand from offices coming online, people at home putting their heating on, lots of businesses running, and it’s cold. I think you could have problems with energy supply.
‘If it just happened to be a particularly non-windy day across the whole of the country, so you lost wind power capability, that would be a problem.’
National Grid’s flexibility service will see energy suppliers like Octopus pay households to cut energy usage
How likely are blackouts and how long could they last?
A milder October has helped to lower demand and provide the opportunity for storage to refill, meaning there is less pressure on the system.
While we might not see a public campaign encouraging people to cut their usage, the National Grid Electricity System Operator (ESO) will run a ‘Demand Flexibility Service’ until March 2023.
This will pay households to reduce their usage during peak hours of the day to avoid blackouts across the UK
Under a similar scheme launched last week, Ovo customers will be rewarded with up to £100 – £20 a month if they slash their energy use in peak times. Ovo has narrowed down its peak demand to between the hours of 4pm and 7pm, as its data shows that the average household uses 19 per cent of its daily total usage during these times.
‘Natioal Grid have, over time, developed a lot of programmes to prevent these blackouts from happening,’ says Guillaume Proost, founder of climate technology startup OakTree Power.
‘I think we’re certainly less at risk than other nations from that point of view. There is always a risk because of the intermittency of renewable energy. We rely increasingly on wind in the UK in particular.
‘There is always a risk of blackouts, but I suspect that these risks are being extremely well managed and hopefully there will be an increasing participation from electricity consumers across the board, which will help National Grid to maintain stability.’
Energy consultancy Cornwall Insight has said the base case scenario currently is that there will be adequate power across the winter, and the ESO predicts demand to be lower than previously forecast.
This is in large part because prices continue to be high given ongoing storage concerns.
The Demand Flexibility Service was developed to encourage customers to cut their usage and give National Grid a bit more leeway at times of high demand. In the base case scenario, this service would be used for between 0 and 5 days according to Cornwall Insight.
In the event there is not enough gas because of a lack of imports from France, Netherlands and Belgium, contingency measures are in place, although Cornwall says a scenario where these would need to be called upon is ‘highly unlikely’.
ESO has also agreed contracts with Drax, EDF and Uniper to extend the use of coal-fired power plants this winter until the end of March 2023.
Cornwall Insight says these units won’t be contracted to the open market and ‘are only intended to be used when all commercial options have been exhausted.’
However, it warns that without sufficient uptake of the flexibility service, especially during cold spells, some customers could well face interruption to their supply.
Another scenario could see negative supply surplus in the new year ,which would lead to more significant interruption. It could see the temporary implementation of something called ‘rota load shedding’ to control or reduce the demand for electricity, although the ESO sees this as unlikely.
Rota load shedding, also referred to as a rolling blackout, would mean some customers could be without power for pre-defined periods during a day, typically for three-hour blocks.
Businesses and emergency services will have back-up generators to ensure minimal disruption.
How can consumers prepare for blackouts?
The message seems to be that the lights are unlikely to go out, but consumers will still need to play their part in preventing blackouts.
The ‘Demand Flexibility Service’ launched earlier this month and consumers can sign up via their energy supplier to receive money in return for cutting usage between 4pm and 7pm.
‘It’s everyone’s responsibility to understand how these markets operate and to participate… there are many benefits from it,’ says Proost. ‘We will ultimately reduce electricity consumption and therefore reduce our overall electricity bill and reduce the carbon footprint.’
For more information on how to reduce the cost of energy, check out our essential guide which covers how your bills are worked out, what help is available and how to save on energy.
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