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ESO expects sufficient supplies this summer

National Grid Electricity System Operator’s (ESO) is confident that it has the operational tools to manage the electricity system, with sufficient supply to meet demand, to such an extent that it expects to support exports to neighbouring European countries.

In the 2024 Summer Outlook, published on 11 April, the ESO set out its view of the electricity systems and expectations for the electricity network for the upcoming summer period.

For summer 2024, it said that energy markets show “signs of finding a new equilibrium”. Wholesale prices have fallen significantly, reflecting high scheduled French nuclear availability, and robust European gas storage. While volatility in the energy markets shows signs of subsiding, the electricity system continues to change at pace. The ongoing growth of embedded generation on the distribution networks continues to lower peak summer transmission demands and increase the significant variability in daily demand patterns.

Seasonal normal summer minimum demand is expected to be marginally higher than last summer’s weather corrected outturn, due to an increase in the installed capacity of battery storage connected to the distribution networks. Peak transmission system demand is expected to continue to fall due to an increase in solar generation connected to the distribution networks. Minimum forecast generation is expected to be comfortably above summer peak demand. The ESO expects higher demand for the seasonal normal minimum transmission system with a higher predicted minimum demand of 13.5GW and a peak of 29.2GW. Additionally, it expects the minimum available generation to be 34.1GW, sufficient to meet the expected higher demand. As such the ESO is confident that there will be sufficient available supply to meet demand, and its reserve requirement, throughout the summer.

Source: National Grid ESO

To balance supply and demand ESO said that it will likely have to take actions on the system when demand is low, but these will mainly be everyday actions such as trading on interconnectors, or issuing everyday control room instructions to increasing demand through pumping or charging storage. The ongoing growth of grid scale battery storage continues to provide additional flexibility at minimum demands. Should we exhaust our everyday actions, we have a further range of enhanced actions which afford further downward flexibility, such as issuing a Negative Reserve Active Power Margin.

Despite predicting an increase in volume of balancing actions, the ESO said it expects balancing costs to be lower than the same period last year. This is a result of offsetting costs by falling wholesale prices and efficiency measures. The ESO has also forecast a reduction in operational costs of £65M a year.

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