National Grid to pay customers to cut power as freezing weather bites UK

Britain’s electricity system operator will pay households to use less power during early Monday evening and has also put three emergency coal-fired power units on standby as large parts of the country are gripped by freezing weather.

National Grid said on Sunday that it would activate a new service introduced this winter, through which households and businesses are paid to reduce their consumption during crunch times when the electricity grid comes under strain.

The so-called “demand flexibility service” will be activated between 5pm and 6pm on Monday, National Grid said, warning that its forecasts “show electricity supply margins are expected to be tighter than normal on Monday evening”.

If activated, it would mark the first time the new service has been used in a “live” situation, although National Grid has tested it multiple times with participating suppliers, including Octopus Energy, Centrica and Eon. Households with smart meters have been able sign up to the service if their supplier is taking part.

The electricity system operator has also asked two coal-fired units at the giant Drax power station in Yorkshire, plus a third at the West Burton plant in Nottinghamshire, to warm up in case they too are required to help meet demand on Monday, when wind speeds are also forecast to be low.

All three coal units had originally been due to close permanently in September last year but have negotiated contracts with National Grid to remain on standby for emergency use this winter at the request of the UK government.

Both the coal plant extensions and the demand flexibility service are part of the government’s contingency plans for possible energy shortages, which were drawn up after Russia’s full-scale invasion of Ukraine triggered fears of possible blackouts across Europe.

National Grid insisted on Sunday evening that the measures did not mean there would be power cuts but said they could be used to increase the cushion between electricity supplies and demand to a more comfortable level.

“This does not mean electricity supplies are at risk and people should not be worried,” National Grid ESO, the part of the FTSE 100 energy group that oversees Britain’s electricity system, said. “These are precautionary measures to maintain the buffer of spare capacity we need.”

Energy consultancy EnAppSys said power prices for peak hours on Monday indicated tight margins between supply and demand but they were “not as bad as previous days this winter when [National Grid ESO] chose not to dispatch contingency coal plants”. It added in a tweet that the decision to warm the coal-fired units showed an “abundance of caution” on National Grid’s behalf.

The Met Office has warned that southern, eastern and central England will continue to experience very cold temperatures on Monday and it has issued a weather warning for freezing fog earlier in the day, which could cause travel disruption including possible flight cancellations.

National Grid in December put some emergency-use coal units on alert during a previous cold snap, only to stand them down when it managed to secure sufficient supplies. It also did the same with the demand flexibility service in November.

Traders had recently been more optimistic that Europe would be able to survive the winter without blackouts after unseasonably warm weather over the festive season and early in the new year allowed countries in the EU to generally refill their gas storage facilities rather than withdraw from them. This is also relevant to Britain as it traditionally relies on electricity and gas imports from the continent during particularly cold periods.