The Leading News & Information Service For The Facilities, Workplace & Built Environment Community

Wholesale Power - Cannibals Gather For The Easter Feast

Wholesale Power Market
06 June 2019

At Easter, as the UK bathed in warm sunshine, the GB wholesale power market experienced a series of notable events - including cannibalisation.

High levels of embedded solar generation reduced the need for grid-connected energy production, causing the minimum daytime demand to drop below the night time minimum twice over the Easter weekend.

Over the course of the weekend, GB also broke its record for consecutive no-coal hours, setting a new record of 90 consecutive no-coal hours, as low demand levels and high renewables output negated the need for the fossil fuel technology.



The GB market also experienced the phenomenon of wholesale price cannibalisation in action, particularly on Easter Sunday, where wholesale prices underwent notable reductions.

The cannibalisation effect is the depressive impact on wholesale electricity prices caused at times of high output from intermittent, weather-driven forms of generation, such as solar, onshore wind and offshore wind farms - in essence the rule of supply and demand kicks in.

Tim Dixon, Wholesale Team Lead at Cornwall Insight, (which advises on energy procurement) told ThisWeekinFM: “The Easter weekend has given us a glimpse into the future as we move into a world with higher levels of embedded and intermittent sources of generation (although since then the weather has deteriorated as far as the solar market is concerned).

"With a large volume of wind farms set to commission under the Contracts for Difference Scheme, we will see a higher requirement on the system for gas to act flexibly rather than generate baseload. Furthermore, greater penetration of intermittent renewables will lead to more cannibalisation and volatility in wholesale prices.

“A repercussion of these trends is that National Grid will increasingly need to instruct generators to turn down during the day. This could potentially result in negative system prices – a trend which is also becoming more prevalent.

“Flexible energy providers, particularly storage assets, may find some positives from this trend. Increased volatility and more significant price differentials between periods of low and high demand will produce arbitrage opportunities.

“This is something that will be welcomed by storage operators and flexible generation looking for revenues beyond National Grid procured services such as frequency response, STOR and the Balancing Mechanism.”

Cornwall Insight’s long-term power market modelling predicts many of these trends, under specific scenarios.

Picture: At Easter, as the UK bathed in warm sunshine, the wholesale power market went cannibal.

Article written by Brian Shillibeer | Published 06 June 2019


Related Articles

Neste Using Wind Power At Its Production Sites

The Neste Corporation has committed to lowering its carbon footprint in production ahead of the EU’s climate and energy targets. The global company has reached a...

 Read Full Article
April 2019 - Energy Tax To Rise By 65%

The Climate Change Levy and Renewables Obligation could see a 65% rise in energy tax this coming April. ThisWeekinFM has teamed up with UK Energy Management to provide...

 Read Full Article
Renewables And The Microgeneration Plan

Building a micro grid has got easier and cheaper  as the equipment needed has reduced in price and become more available. Here, Jonathan Wilkins of EU Automation,...

 Read Full Article
The Impending Power Shift Ignored by Old Fossils

According to fossil fuel companies, the world will continue to rely on their products for decades. They even have sophisticated scenarios, outlooks and modelling to prove...

 Read Full Article
Labour Party Launches National Mission on Clean Energy

Labour leader Sir Keir Starmer has vowed to end North Sea oil and gas exploration and to set up a publicly owned green energy company. If successful in the next...

 Read Full Article
German Cities Impose Emergency Energy Saving Measures

As gas production from Russia’s Gazprom slows, cities in Germany are switching to cold water in pools, turning off the spotlights at public monuments and banning...

 Read Full Article
New Housing in London at Risk as Electricity Networks Near Capacity

New developments in London may be stalled due to the electricity grid running out of capacity. According to a letter seen by the Financial Times, The Greater London...

 Read Full Article
UK Leads in the Future of Post-EV Technology

The UK’s Transportation and Storage sector is now the eighth-fastest growing sector in the country and the second-ranked sector for business growth in the past...

 Read Full Article
FMs Have Four Weeks to Apply for Electricity Generation Funding

Facilities management companies that own or operate commercial electricity generation have just four weeks left to apply for funding that will help them update their...

 Read Full Article
Clarke Energy – EMEX 2021 | Focus Interview

Andy Cooper, UK Sales Manager at Clarke Energy, joins us to discuss CHP technology and other energy solutions. Clarke Energy, a KOHLER Company, is a...

 Read Full Article