Month: March 2019

Energy Network Balancing

Energy Network Balancing

Last Monday saw wholesale energy prices dip to negative levels for more than six hours meaning suppliers where having to pay to produce energy, forcing National Grid to order power plants to turn down production.

This event was off the back of unseasonably warm and bright conditions meaning more of the public where outside enjoying the weather creating a drop-in demand alongside a surge in solar production going from a seasonal average of 3.5GW to 7. 7GW. This kind of event is not that unusual and similar events where seen last year in January and August.

Common sense would dictate that if power producers where having to pay for their power to enter the system, they would naturally curtail producing to continue to be profitable, however this leaves out the vast array of subsidies that some producers are receiving in the form of ROCs, Fits, or even PPA agreements.

What this means in practice is that some producers would need much higher negative market figures before they would not be making a profit i.e if the market price is -£70MWh and the subsidy is £150 a MWh, they would still be making £80 a MWh. This leaves Nation Grid with the problem of balancing the system which it does by restricting generators who then receive payment for the energy they have to restrict (curtailment charges), these are negotiated between Nation Grid and each generator. Last year there was 125M of curtailment charges paid to wind farm operators, these are recouped through energy bills from the consumer.

On the other side of this storage operators i.e grid scale battery and pump storage hydro meant they could use this negative pricing to purchase power to store the energy. In effect being paid to fill up their batteries or pump water to the top of the reservoir.

As we move towards low-carbon generation and away from thermal generation i.e coal plants closures by 2024 plus the difficulty the Government is having with nuclear generation we are going to become more and more reliant on the intermittent generation of renewable energy, meaning these types of events will only increase. 

It’s clear that large scale renewable deployment comes the need for large scale storage whether that comes from pumped storage hydro, batteries or other technologies. National Grid’s 2018 future energy scenarios report forecasts that up to 29GW of total storage capacity will be needed by 2050.

As the amount of storage increases this will reduce the need for National Grid to curtail renewable generation making sure the country maximises the potential of renewable energy, reduces the costs to the consumers and keeps the lights on.

What is Pump Storage Hydro?

What is Pump Storage Hydro?

The wind doesn’t always blow, the sun doesn’t always shine. It can’t be relied on to match consumer demand for electricity, meaning other sources of generation are need to be ready as back up i.e. gas, coal or nuclear.

Currently renewable generation is switched off when not required (curtailment). This means that potential renewable energy is wasted, and National Grid currently pay developers to switch off generation. Last year they paid over £125M in curtailment charges to wind farm operators, these charges are recouped by National Grid through consumer energy bills.

Pump Storage Hydro offers a way to store excess renewable energy at times when demand is not required so it can be stored until needed. The system uses electricity to pump water from a lower reservoir to a higher reservoir. This pumping happens at times when there is more energy being produced on the grid network than is needed. This energy is stored until it is required, when the water is allowed to flow back through a hydro-turbine, generating electricity to meet sudden or predicted spikes in consumer demand.

This cycle of pumping and generating repeats daily as required. Pumped storage utilises excess generated electricity when consumer demand is low and generates electricity when demand increases.

A typical conventional pumped storage hydro power plant consists of four components:

1. Water reservoirs: normally two interconnected water reservoirs.

2. Water piping: tunnels that allow moving water from one reservoir to another.

3. Powerhouse: facility with one or more pump/turbine and motor/generator assemblies that allow pumping water into the upper reservoir at off-peak hours and discharging water into the lower reservoir.

4. Grid connection: power transmission lines to move the generated power from the plant into the grid. Components are often housed underground.

There are 4 operational PSH plants in the UK with a combined generation capacity of 2.8GW. We are proposing 3 new projects in Scotland the most advanced being a 450MW scheme Red John in Inverness currently in planning. The capacity of these projects would be over 2GW, this would almost double the current PSH generation capacity in the UK.

Energy Storage Gap in New Offshore Wind Plans

Energy Storage Gap in New Offshore Wind Plans

On Wednesday the UK Government announced a Sector deal with the offshore wind industry that would see 30% of UK power coming from offshore wind by 2030, increasing capacity from 7.9GW currently to 30 GW.

The remaining 70% is planned to come from nuclear and Gas plants with carbon capture but with 5 of the 6 planned nuclear plants unlikely to go ahead and no commercial scale gas with carbon capture planned there is a growing concern as to how the UK will be able to keep the lights on while continuing the transition to low-carbon energy.

Energy and Clean Growth Minister Claire Perry said: “This new sector deal will drive a surge in the clean, green offshore wind revolution that is powering homes and businesses across the UK, bringing investment into coastal communities and ensuring we maintain our position as global leaders in this growing sector.

“By 2030 a third of our electricity will come from offshore wind, generating thousands of high-quality jobs across the UK, a strong UK supply chain and a five-fold increase in exports.”

However, John Sauven, executive director of Greenpeace UK, thought these figures should be higher: “The Government’s plans for a fleet of new nuclear reactors has collapsed. This leaves Britain with a big energy gap in the future. It means the Government’s latest offshore wind target of 30 gigawatts by 2030 is woefully inadequate.

“Renewable power now presents the best opportunity for cheaper, cleaner and faster decarbonisation. Wind and solar must be tripled between now and 2030, with offshore wind the future backbone of the UK’s energy system.”

Our own Mark Wilson said: “Government focus on renewable energy can only be a good thing however without a coherent energy storage plan the true potential of renewable energy will be squandered. This announcement makes the case for Pumped Storage Hydro even more urgent and persuasive.

“UK wind developers were paid 125M in curtailment charges last year alone – in other words, they were paid not to produce electricity.  Our plans will go a long way to help get the maximum benefit of new renewable energy for the country and the environment.”

This was echoed by former UK Energy Minister, Brian Wilson saying “One way or another, there has to be back-up to the intermittency of renewable generation, and this creates a huge opportunity for UK industry. In Scotland, Pumped Storage Hydro – which provides 95 per cent of storage around the world – is the obvious answer instead of relying on imports via interconnectors.

“Hydro power has served Scotland exceptionally well in the past and can do so for many years to come. This is an opportunity to give an established technology a new lease of life with huge potential benefits for the Scottish economy while at the same time helping to solve the inescapable challenges posed by reliance on renewable generation”.

ILI currently have 3 Pump Storage Hydro sites in Scotland the most advanced being a 450MW scheme Red John in Inverness. The capacity of these projects would be over 2GW, this would almost double the current PSH capacity in the UK.

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