Register with us today

and in less than 60 seconds continue your access to:Latest news headlinesAnalytical topics and featuresCommodities videos, podcast & blogsSample market prices & dataSpecial reportsSubscriber notes & daily commodity email alerts

Already have an account?

Log in to register

Forgot Password

Please Note: Platts Market Center subscribers can only reset passwords via the Platts Market Center

Enter your Email ID below and we will send you a link to reset your password.


  • Email Address* Please enter email address.

If you are a premium subscriber, we are unable to send you a link to reset password for security reasons. Please contact the Client Services team.

If you are a Platts Market Center subscriber, to reset your password go to the Platts Market Center to reset your password.

In this list
Electric Power | Natural Gas

UK power balancing costs top GBP140 million in June as contract costs sink in

Commodities | Energy | Electric Power | Renewables | Natural Gas

Hydrogen: Beyond the Hype

LNG | Natural Gas | NGL

Platts LNG Alert

Electric Power | Renewables | LNG | Infrastructure Utilities

Caribbean Energy Conference, 21st

Natural Gas | Natural Gas (North American) | Oil | Crude Oil | Refined Products

Western US Gulf of Mexico evacuations beginning ahead of tropical storm

UK power balancing costs top GBP140 million in June as contract costs sink in

Highlights

BSUoS costs down 13% on May, up 57% on year

'Other' constraint costs remain sharply higher

Six-month BSUoS costs hit GBP858 million

London — UK Balancing Services Use of System (BSUoS) costs remained unusually high in June, with constraint payments to gas, wind and "other" contracted plants nearing GBP95 million ($124 million), National Grid data showed August 3.

Not registered?

Receive daily email alerts, subscriber notes & personalize your experience.

Register Now

UK electricity demand of 16.32 TWh in June was down nearly 12% year on year as lockdown restrictions inhibited activity, forcing National Grid to take emergency action particularly at weekends due to excess renewable energy supply.

June total BSUoS costs dipped on May's GBP163 million, but at GBP140 million were still 57% higher than a year earlier, boosting six month 2020 BSUoS costs to GBP858 million from GBP550 million for H1 2019.

Escalating costs were once again driven by constraint payments to gas and wind generators, while payments to the catch-all "other" category (hydro, open cycle gas, nuclear, demand side suppliers) were around GBP20 million for the second month in a row, compared to GBP3.5 million in April.

This reflects the cost of bilateral turn-down contracts signed by National Grid notably with nuclear generators as the drop in demand from lockdown became apparent.

In detail, gas plant constraint costs topped GBP60 million in June, wind constraint costs came to GBP19.77 million and "other" costs came to GBP22.90 million.

In June 2019 "other" constraint payments were actually receipts to National Grid of GBP21 million, reducing total net constraint costs to just GBP24.63 million versus this June's GBP94.44 million.

"We're heading into unprecedented times, volatility is going to be exponential," a London-based power trader said in July.

"Blindly running your assets without any understanding or reaction to the markets is going to be extremely inefficient from a price and a carbon angle," he said, noting the increasing amounts of money to be earned in the balancing market.