Power shortage risks by 2015, Ofgem warns

The coal fuelled Ferrybridge power station The regulator said coal-fired power stations would be closing sooner than expected

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Britain risks running out of energy generating capacity in the winter of 2015-16, according to the energy regulator Ofgem.

Its report predicted that the amount of spare capacity could fall from 14% now to only 4% in three years.

Ofgem said this would leave Britain relying more on imported gas, which would make price rises more likely.

The government said that its forthcoming Energy Bill would ensure that there was secure supply.

Ofgem blames the risk on coal-fired power stations being closed sooner than expected and EU environmental legislation.

The warnings come in Ofgem's first annual Electricity Capacity Assessment.

It comes three years after Ofgem's Project Discovery report, which warned that electricity shortages could lead to steep rises in energy bills.

It is now saying the highest risk of shortages would be sooner than expected because coal-fired power stations would be closing sooner than it had predicted in 2009.

'Unprecedented challenges'

The regulator said more investment was needed in building fresh generating capacity.

Start Quote

Consumers need protection from price spikes as well as power cuts”

End Quote Audrey Gallacher Consumer Focus

"The unprecedented challenges in facing Britain's energy industry… to attract the investment to deliver secure, sustainable and affordable energy supplies for consumers, still remain," said Ofgem chief executive Alistair Buchanan.

"Ofgem is working with government on its plans to reform the electricity market to tackle these issues."

Energy Secretary Ed Davey said the government would respond to the report before the end of the year.

"Security of electricity supply is of critical importance to the health of the economy and the smooth functioning of our daily lives," he said.

"That is why the government is reforming the electricity market to deliver secure, clean and affordable electricity."

Ofgem's Ian Marlee: "There is an increased risk of electricity shortages"

Energy UK, which represents the energy industry, said Ofgem was right to highlight the challenges it faces in the coming years.

"We must secure over £150bn of investment in the UK to replace aging power stations and infrastructure, keep the lights on and meet our carbon targets," said its chief executive Angela Knight.

"All while making sure that energy bills are affordable for the millions of homes and businesses that rely on the power supplied by our members."

Price worries

The trade union Prospect, whose members include 21,000 professionals working in nuclear decommissioning and energy supply, called for government action to avert power shortages.

"This report highlights how imperative it is for the government to act now and introduce electricity market reform that ensures the programme of new nuclear build and other vital energy infrastructure projects, such as carbon capture and storage, are attractive enough to secure the long-term investment they require," said Prospect general secretary designate Mike Clancy.

Audrey Gallacher, director of energy at Consumer Focus expressed concern about the dangers of rising prices.

"While there is enough generation capacity to mean that widespread power-cuts are still unlikely, narrower margins mean the risks of outages are higher and scarcity of energy could also feed into possible price rises in future," he said.

"Consumers need protection from price spikes as well as power cuts."


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  • rate this

    Comment number 861.

    I'm neither labour nor communist but I do think there is a point in having the utilities at least nationalised again so if things go wrong we can blame ourselves and not all the german/french/russian shareholders who control prices and take what they can out of Britain but don't put anything in to compensate.(Apart from paying lawyers/accountants to fight for their 'rights' to a fat profit)

  • rate this

    Comment number 860.

    All you lot debating about wind, tidal, gas, coal, nuclear etc are missing the point.

    It is now not some nice question of environmentalism, we are now imminently going to run short of power because no politicians have grasp the nettle & invested in serious power generation & we have to rely on French & German expertise.

    It's pathetic.

  • rate this

    Comment number 859.

    It's nothing to do with privatisation. It's govt policies…This should have been planned for 10-15 years ago,
    I thought that this was the whole idea of privatisation that the industry would take care of itself.
    But all that it has seemed to do was take care of its owners.
    Oh, Govt are to blame, but not for the reasons you claim.

  • rate this

    Comment number 858.

    It is not just energy generation that needs attention but also energy demand reduction.

    Look at offices, Business parks that leave their lights on all night & weekend. How many machines eg: computer screens, photocopiers etc are left on when no one is around at night/weekends? Collectively, this is vast energy waste. Same problems with home energy use.

  • rate this

    Comment number 857.

    Norman, the UKL has the 4th cheapest electric and gas in Europe we are not being 'ripped off' in fact the reason no one will renationalise is it would put bills up! Remember problems in the 70's? Unions grr

    There is a simple solution which is build more gas fired p stations they are actually on the way which this report fails to mention.

    same as solar the FIT came from US via OUR bills!

  • rate this

    Comment number 856.

    I used to have a gas fridge. Very efficient, and one of the cleverest devices ever invented I'd say, with no moving mechanical parts to wear out. (Perhaps why you don't seem to see them now).

    If such a fridge can be made, then so can aircon etc., and it would be a huge power saving if that became standard.

  • rate this

    Comment number 855.

    It's long overdue that Nikola Telsa's full discoveries were disclosed. He was working on energy alternatives right up until his death upon which his work was seized by US government and is held to this very day.

    Trouble is, the people in power are as scared of losing some of their influence over people now as they were 100 years ago.

  • rate this

    Comment number 854.

    I don't think the majority of people appreciate the complexity of trying to reduce CO2, stabilise consumer prices, have privatisation and maintain energy security.

    For all those that are suggesting we rush to build nuclear, I hope you realise that like renewables the cost will have to subsidised by us all. Also the main winners will be China and France who, unlike us have the workforce to do it

  • rate this

    Comment number 853.

    You dont have to be a braniac to realise that wave power, wind power and solar power are weather dependant. Nuclear, Tidal, Coal/Gas, Geo-thermal and Hydro are constant dependable sources.

    Hydo is under used, we may have to chop the top off a few mountains in Scotland, or dam up some beautifull countryside, but you cant have it both ways.

    Nuclear would seem the sensible option.

  • rate this

    Comment number 852.


    "All the money has gone on employing more public workers & paying them more... [blah blah blah]. This is the legacy of 13 years of Labour"

    Why not comment on the article instead of the old Jurassic 'Yawnosaurus' act?

    All govts have ducked power production since we drowned in North Sea oil and got complacent.

  • rate this

    Comment number 851.

    Trout mask Replica. So your scientists and media are all 100% correct and the media and scientists I quote are all wrong. The point of being skeptical is open minded and not reverting to the Groupthink ideology of the left. Your main argument seems to centre on ridicule and belittling.

  • rate this

    Comment number 850.

    Just Re-Nationalise an industry that should never have been privatised in the first place.

    The directors of these companies are imoral liars. They make big enough profits to offset any hikes in prices.

    Any future government MUST stop these price hikes and give power back to the regulators to stop these vile companies from putting a gun to our heads.

    Re-nationalisation is best.

  • rate this

    Comment number 849.

    I believe that France produces over 80% of her power from nuclear,with no particular problems.-but the howling anti-nuclear brigade here has had the biggest megaphone for too long.Well,you got what you wished for.Let's hope we don't have to listen to you any longer.Idiots.

  • rate this

    Comment number 848.

    @829 Alan,

    It's nothing to do with privatisation. It's govt policies, and dragging on their heals making long terms plans that are the cause. This should have been planned for 10-15 years ago, instead of concentrating on short term fixes and throwing money at quango schemes and benefits to buy votes.

  • rate this

    Comment number 847.

    #823. Serk

    "Scotland will be fine! We're used to living on the edge of darkness! In 2014 we will be walking into the light!"

    Is that when you will start mining uranium in Orkney?

  • rate this

    Comment number 846.

    Stop paying the shareholders so much and get the damned grid sorted out before it happens. As usual its going to be the poor and low income who pay the most....paying again for business failures. (At least if we freeze to death the govt won't have to worry about providing pensions when we're older which is good economic sense so they probably won't do anything to help....as usual)

  • rate this

    Comment number 845.

    3 Minutes ago
    825.Sidney Monroe

    I bet you believe in fairies and global bunkum don`t you ?'

    Insults from the AGW crowd...so depressingly predictable.

  • rate this

    Comment number 844.

    Post 827 best summarisation of the situation.
    Youy are dead right some decsions are too important to be left to the idiots we call politicians.

  • rate this

    Comment number 843.

    I've got the solution....

    Use all the hot air coming out of our politicians

    Keep us going for years.

  • rate this

    Comment number 842.

    Typical modern day Britain. Absolutely no surprise that our energy strategy (we don't actually have one) is failing the people of the country and putting them at risk.

    I love this country but successive dire leadership, poor decision making and promotion of private greed is sinking us.


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