Shock to energy generation in Scotland

Big concerns over power generation in Scotland this week, with announcements on Longannet and Hunterston power stations.

Those who thought the transmission charges row had gone quiet while Ofgem prevaricates, got a shock this week when Scottish Power announced that Scotland’s largest power station at Longannet may be forced to close due to the huge sums it must pay to connect to the National Grid. It costs about £40m a year to keep Longannet connected to the national grid, while an equivalent power station in the south of England would receive a payment of £4m.

While these discriminatory charges continue, Scottish Power has decided not to enter the contest to supply energy generating capacity in 2018/19. This means financial changes are needed to avert the threat of closure of a plant that provides essential balancing power to the Scottish networks. It generates enough electricity each year to meet the needs of more than two million homes and unlike many renewables, is not dependent on the weather.

The second problem arose at the Hunterston B nuclear power station in North Ayrshire that generates around 15% of Scotland’s electricity. New cracks have been found in one of the reactors
with two of about 3,000 graphite bricks in the core of reactor four affected. The plant operator, EDF Energy, said the cracking was predicted to occur as the station aged and it would not affect the safe operation of the reactor.
While there is no immediate question of losing these important power stations, it does raise questions about the impact their closure would have on the system.

Paul Younger, professor of energy engineering at the University of Glasgow, said: “This is really turning the screws on Scotland’s vulnerability with baseload and dispatchable power. If you take Longannet and Hunterston both out of action that mean the loss of 40 per cent of all the electricity used in Scotland at a stroke.”

Scottish Conservative energy spokesman Murdo Fraser said: “There’s absolutely no suggestion of these cracks causing any safety or health issue, that’s been made absolutely clear by the owners. Any scaremongering to the contrary is unacceptable. But this issue does demonstrate that this is a power station approaching the end of its working life, having made an important contribution. Nuclear energy is an important asset for Scotland and that’s why the Scottish Government has to drop its opposition to new power stations”.

Concerns over generating capacity come when wholesale power prices in the UK market climbed steadily over the third quarter of this year due to supply concerns over European gas imports and nuclear availability. The Icis Power Index (IPI) climbed from lows of £46.373/MWh on 10 July to just over £52/MWh by the end of September due to the unexpected shutdown of almost 3GW of nuclear capacity ahead of winter. They said, “Energy companies are actively buying and selling electricity in the market right now for delivery over the next year, so any price rises on the wholesale market could affect what consumers pay later on.”

While there is no immediate crisis, these announcements should be a wake up call to governments and the regulator that plant closures will have a big impact on Scotland’s energy capacity.

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