Monday 8 April 2024

Grid constraints lead to nearly £1bn in curtailment costs on 2023 electricity bills

Grid constraints lead to nearly £1bn in curtailment costs on 2023 electricity bills

Grid capacity constraints have added nearly £1 billion in ‘curtailment‘ costs to electricity bills for homes and businesses in 2023, as abundant wind energy couldn’t be transmitted due to constraints.

The majority of this cost, amounting to £670 million, was attributed to the B6 boundary on the Scottish/English border, according to a new study.

Field’s analysis projects a potential surge in curtailment costs, reaching £2.2 billion annually by 2030 due to this bottleneck.

Most of the curtailment cost in 2023 stemmed from firing up gas power plants in England and Wales, as capacity constraints prevented the transmission of cheaper wind power from Scotland.

Wind farms in Scotland faced curtailment 40% of the time, while key transmission boundaries in the UK operated at less than 50% utilization, further impeding electricity flow.

Field’s analysis proposes that leveraging existing technologies like battery storage could slash curtailment costs by approximately 80%.

Amit Gudka, Chief Executive Officer of Field, said: “In an era where energy bills remain high and carbon emissions keep rising, it’s alarming that we’re wasting clean, cheap, abundant energy on a daily basis.

“As our analysis suggests, this problem is getting worse, not better.

“Billions of pounds have been earmarked to upgrade the transmission network, but we think there’s a better route here than overspending on this one approach to upgrading the electricity system.

“More efficient use of established technologies, such as battery storage, would dramatically reduce curtailment costs and network investment needs. It would also reduce the need for expensive, complex and disruptive market-based mechanisms such as zonal pricing.”

Written by

Dimitris Mavrokefalidis

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