Delays to building new UK power generation are set to leave the country facing an energy security “crunch point” in 2028.
That is according to a Drax-commissioned report from Public First, which warned of a “perfect storm” of an increase in demand, the retirement of existing assets and delays to the Hinkley Point C nuclear plant. This means the UK will have to tackle demand that exceeds secure dispatchable and baseload capacity by 7.5GW in peak times. This is three times more than the secure de-rated power Sizewell C would be capable of providing when complete and works out at around more than double the gap in 2022.
There is uncertainty too facing biomass generators who are set to contribute over 3GW of secure dispatchable power. Should this persist, this could yet see the shortfall compounded by almost 50%.
Over the next five years, the headroom between secure total supply and peak demand will be tightest in 2028. The scale of the energy crunch is set to play out when the Electricity System Operator (ESO) holds the T-4 Capacity Market Auction, where target capacity is 44GW and only 43.4GW of generation ahs entered the auction. It was noted this is the “tightest it has ever been” since the auctions kicked off 10 years ago.
Drax has warned that without additional being taken to make up the shortfall, the UK will find itself more dependent on intermittent power from international energy interconnectors and renewable sources. Building new capacity will unlikely have a material impact, given the short timeframes at play, meaning that the government should instead look to extend the use of existing baseload generation assets which are able to provide secure capacity. This includes nuclear plants due to retire.
It should also look to agree transitional arrangements for biomass operators planning on installing bioenergy with carbon capture and storage technology, while working to reduce peak demand through encouraging flexibility and installing more home insulation.
