The data presented in a report from MPs criticising recent energy policy is “problematic”, according to research director Jim Watson.
Called ‘Electric Shock: Will The Christmas Lights Go Out Next Winter?’, the report raised concerns over “dangerously small electricity capacity margins that have been left in the wake of a decade of target led, interventionist energy policy.”
The paper, which was published by the British Infrastructure Group of MPs, quoted a figure of 0.1 per cent for this winter’s capacity margin, even though it does not take account of the Supplemental Balancing Reserve (SBR). “They’ve chosen to use the figure without the extra National Grid measures added, which is a silly thing to do really,” said Watson.
Furthermore, the figure comes from National Grid’s winter consultation document which is not the most recent estimate. The winter outlook for 2016/17 put the figure at 1.1 per cent, rising to 6.6 per cent when the SBR is included.
“They also use language in there about things getting worse and actually the position this winter from National Grid is slightly better than the position last winter,” Watson added. “Yes, the position is tight, but I think they are exaggerating to make a point.”
He said it is important to correct such misleading claims: “As has been shown by this report, anything that claims that blackouts are imminent or going to happen will get a lot of coverage.”
The report also criticised the cost of the SBR, as well as that of the capacity market which will replace it next winter. However, Watson said it failed to provide a counterfactual: “If we were to have invested more money in power plants to take account of the coal-closures to keep that margin higher, then of course that would have cost consumers money as well.”
Finally, counter to the report’s assertion, Watson said the use of demand-side response is “nothing like” the three-day weeks of 1970s. “It hasn’t affected households for one, and secondly those companies… that have agreed to turn down their demand at peak times are being paid to do so and are entering into contracts voluntarily.”