Great Britain Grid Balancing Costs Near £50m a Day Amid Windfarm Curbs
Grid operator paid £47.9m on Wednesday to switch off windfarms and switch on gas plants as transmission bottlenecks persist
By AXY Energy Desk ·
Key points
- Great Britain's grid operator paid £47.9m on Wednesday to switch off windfarms in surplus areas and switch on gas plants where supply was tight.
- The main cause is a lack of transmission capacity, especially high-voltage cabling between Scotland and southern areas of demand.
- Monthly balancing costs reached a record £505m in September, and forecasts expect £3.2bn over the next year.
- The £150bn network upgrade is struggling to keep pace with new renewable projects connecting to the grid.
The cost of balancing Great Britain's power grid has climbed to near-record levels of almost £50m a day, after the grid operator paid £47.9m on Wednesday to switch off windfarms in areas with an oversupply of electricity and switch on gas plants in areas where supplies were tight, according to reporting by The Guardian Energy. The payments were driven by bottlenecks in moving power around the country, not by a shortage of electricity across the system as a whole.
Balancing the grid means keeping electricity supply and demand matched at every moment. The National Energy System Operator, known as Neso, is responsible for this task in Great Britain. When power cannot flow where it is needed, Neso has to change how generators are running. It pays some plants to reduce output, and it pays others to increase it. These payments are commonly known as constraint costs, and they can rise sharply when the network cannot move power efficiently.
Why windfarms are being switched off
The central problem is geography. Much of Great Britain's wind power is generated in Scotland, where the wind is often strong, while much of the demand sits further south in England and Wales. The transmission network that carries power between these regions has limited capacity. When too much electricity is produced in the north for the lines to carry south, the system operator has to intervene to avoid overloading parts of the network.
The Guardian report says windfarms are typically paid to turn off in Scotland because there is not enough high-voltage cabling connecting the country to areas of growing demand further south. High-voltage lines are the large cables and pylons that move bulk electricity over long distances. Building new ones takes years of planning, consents and construction, which is why capacity has not kept pace with the rapid growth of renewable generation.
The scale of the response on Wednesday was significant. According to the consultancy LCP Delta, windfarms and hydropower plants with about 9 gigawatts of capacity were paid not to generate. A gigawatt is one billion watts, and the report says that volume of capacity would be enough to power more than 8m typical households. The single most expensive period was a half-hour window in which one payment alone reached £1.6m.
How the costs reach household bills
The costs are levied onto household energy bills, which means consumers ultimately pay for the system's balancing actions. This makes the issue more than a technical matter for grid engineers. Every pound spent on switching plants on and off is recovered through the wider energy system, so higher balancing costs can feed into what people pay for electricity.
The Guardian report says the balancing costs have been rising steadily. They reached a total of £505m in September alone, the highest monthly cost recorded. Forecasts cited in the report expect the costs to reach £3.2bn over the next year. Those figures show a trend rather than a single bad day, and they explain why the cost of running the grid has become a central concern for regulators, policymakers and energy customers.
The payments on Wednesday were also among the highest recorded since the early months of 2022, when Russia's full-scale invasion of Ukraine sent European gas and power prices sharply higher. Because gas plants are often the marginal source of power that is switched on to fill gaps, high gas prices can make each balancing action more expensive. Analysts generally point to that link when comparing today's costs with the crisis period, although the underlying causes of the current spike are different and centre on the network.
Emergency help from France and power imports
The record costs came to light only days after Neso was forced to call for what the report describes as last resort emergency assistance from its counterpart in France. The French operator agreed to send last-minute power supplies to Great Britain on Monday and again on Friday of the previous week. Such requests are unusual, and they indicate how tightly the system was being managed at short notice.
On Wednesday, the operator also bought more electricity imports from Europe through high-voltage subsea power cables. These interconnectors allow electricity to flow between Great Britain and neighbouring countries, and they can be used to bring in power when domestic supply is tight or when it is cheaper than the alternatives. The report notes that a string of gas and biomass plants were also fired up to meet demand in the areas where supplies were short.
This combination shows how the system is being balanced from several directions at once. Turning windfarms off in one region while bringing gas, biomass and imported electricity online elsewhere is an expensive way to keep the lights on. It also means that clean power generated in one part of the country is effectively wasted, because the network cannot carry it to the places where it is needed.
Infrastructure struggling to keep pace with renewables
The Guardian report highlights the growing concern over the pace of Great Britain's £150bn power networks upgrade. That programme is intended to expand and strengthen the transmission system so that it can carry more electricity from new generation to consumers. However, the report says the upgrade is failing to keep up with the new renewable energy projects being connected to the grid.
This gap is one of the most difficult problems facing the energy transition. Developers can build wind and solar farms faster than new lines and substations can be completed, and many projects have waited years for a grid connection. When the network lags behind, generators can be built but not fully used, and the system operator must pay to manage the resulting congestion.
Shivam Malhotra, head of power trading at LCP Delta, offered a direct explanation of the problem. He said: The system overall wasn't tight in terms of power supplies. It's the age-old story of a lack of infrastructure to transport power to where it's needed, leading to lots of windfarms being turned off. His comment suggests that the issue is not a lack of generation capacity overall but the difficulty of moving that power to where consumers are.
What happens next
Analysts expect the balancing costs to remain under pressure while transmission capacity lags behind new renewable projects. The next steps will be watched closely in several areas, including the pace of network upgrades, the timetable for connecting new generation, and the monthly figures for balancing spending that will show whether September's record marks a peak or the start of a longer trend.
Another question is how the costs are shared and recovered. Because they are passed through to household bills, decisions about grid investment, market design and the allocation of charges are likely to be closely scrutinised by consumer groups and politicians. Any faster build-out of transmission lines could reduce the need for expensive interventions, but the benefits would take time to arrive.
For households, the immediate effect of the Wednesday payments is less visible than the longer-term implication that balancing costs are part of the bills people pay. For the energy system, the episode highlights a simple but difficult lesson: generating clean power is only part of the task, and the network that carries that power must be built at a similar pace. Until the grid catches up, the operator is likely to keep paying to move electricity around the country, and those payments will continue to be watched as a measure of how well the transition is working.
Topics: National Energy System Operator, Neso, Great Britain power grid, windfarm curtailment, grid balancing costs, LCP Delta, household energy bills, transmission infrastructure
Sources: The Guardian Energy