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 901.

    the solution seems simple to me, we need to blitz on constructing wind farms all over the coasts and hills, solar panels on every house, and nuclear stations as much as safely possible, then we wont need to use less or be efficient because renewable means it's infinite! I know there are other concerns that it doesn't look pretty but frankly the alternative looks much worse,

  • rate this

    Comment number 900.




    Get your Thermals now. Brrrrrrrr

    Would the Internet still work I wonder? And for how long?

    Time to check out my generator. Get some Petrol in. Do a Francis Maude.

  • rate this

    Comment number 899.

    @ 885.Steve
    How many deaths have actually been attributed to these accidents? FYI - Chernobyl was caused by a faulty reactor design. Fukushima was built on a tectonic fault.

    Yes, I am aware of these facts but do stop acting an ignorant fool yourself. If they foresaw these design faults, do you think they would have gone ahead and built them? Your misguided arrogance beggers belief.

  • rate this

    Comment number 898.

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

    Well don't close them early then...and ignore the EU legislation

  • rate this

    Comment number 897.

    So wait - the power companies plan to charge customers more money for actually supplying them with less power! Next they'll be calling themselves a bank

  • rate this

    Comment number 896.

    The lack of strategic thinking by government in this country is truly breathtaking. To be faced with even the prospect of power shortages in a country as developed as UK is a national disgrace.

  • rate this

    Comment number 895.

    Funny. Just read the article about electric cars then i read this. If we all went to electric cars imagine the problems we would have. Not enough to heat and power our homes never mind powering our cars on a daily basis. Think how how much electricity would go up then.

  • rate this

    Comment number 894.

    Successive govts but especially Tory ones bent the figures to make it possible to flog off vital industry sectors to party donors.

    Who then flogged everything off cheap to foreign companies.

    The 'market' is merely insane calculations forced onto govt depts by industry lobbyists. Who then employ the civil servants as payback

    This could all have been foreseen - AND WAS.

    Utter shambles

  • rate this

    Comment number 893.

    Please get your all your MPs to read this:
    They, and you, may or may not agree with all the details, but at least they must read, apply common sense, and decide on something NOW.
    Past political 'actions' on wind and solar have just been an irrelevant, minor and time wasting distraction from dealing with the problem.

  • rate this

    Comment number 892.

    Far from increasing prices we need a body that will command the directors (criminals) of these companies to CUT prices.

    Its time the market served us the consumer not as the perverts of New Labour and Conservative have done, the other way round. Only sick devious minds would accept the way the Market holds the consumer to ranson as it is today.


  • rate this

    Comment number 891.

    We are an island, surrounded by a continual and reliable source of renewable energy. We also have some of the most skilled engineers and research technicians around the world. Capture of wave energy, once developed could be exported. Lets create some jobs now in the R&D sector and then in the infrastructure construction industry to assit witht he economy. Keynesian economics are required here.

  • rate this

    Comment number 890.

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

    Ahah! another govt. dept. gets it's numbers wrong...

  • rate this

    Comment number 889.

    We do at present but once Cockenzie & Longannet shut our capacity drops dramatically by 25%. Hunterston has also recently had planning for a CHGT plant so all is not that rosy.

  • rate this

    Comment number 888.

    "It's all too easy to focus on the effects of a disaster and not the actual likelihood of it happening in the first place. Should we all call for banning planes every time one crashes?"

    Only if those planes carry harmful radioactive materials that contiminate the soil for hundreds of miles creating, like the Chernobyl distaster, cancers in many people for many years to come

  • rate this

    Comment number 887.

    In regard to solar panels on all new buildings - Why not force these huge structures that supermarkets/shopping centres/DIY stores to have solar panels fitted. They have vast expanses or roof space which could easily accommodate solar and would provide a reduction in their consumption. Surely better than putting a token mini wind turbine in a Tesco car park. Very thoughtful Tesco!

  • rate this

    Comment number 886.

    bluepencil, its has nothing to do with greed, its a fact energy all over the world is going up! As more and more want electricity in their homes for the umpteenth time gas/leci is the 4th cheapest in Europe!! Where inefficient PS operate. We need to realise the era of cheep fuel has gone and instead of blaming greedy co's look at the real reasons. DOH!

  • rate this

    Comment number 885.

    @841.JPublic - How many deaths have actually been attributed to these accidents? FYI - Chernobyl was caused by a faulty reactor design. Fukushima was built on a tectonic fault. Coal mining has killed tens of thousands of miners since the turn of this century. Smog and pollutants from coal power stations hundreds of thousands more. To make an informed decision you need at least a few facts.

  • rate this

    Comment number 884.

    Oh I know. Lets spend another 100 billion on useless wind turbine power industrialised stations ( wind "farm" lol lol) made by foreign companies - have them destroy our countryside our heritage our economy, our health our tourist industry, leaving million in fuel poverty.

    OR build ONE nuclear station that outputs all the electricity that these monstrous 4000 turbines can generate. Simples !

  • rate this

    Comment number 883.

    The White Paper for new builds was published in 2008. Since then out of the consortia, only EDF remains. Nuclear energy is green and efficient. BBC only reports the negative impacts but the technology is now 100 times more advanced than back in 70s. And BBC, the super-high waste figures in all your articles are incorrect - convenient way to mislead your readers!

  • rate this

    Comment number 882.

    Im not sure which side Ofgem is on as what they are saying is prices will continue to go up no matter what. A new body is needed to take these greedy power companies on and perhaps even re nationalise


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