October 12, 2017 / 10:05 AM / 9 months ago

Britain has enough power to meet winter demand - National Grid

LONDON (Reuters) - Britain will have enough power generation and imports through interconnectors to meet demand this winter, National Grid (NG.L) said in its 2017/18 winter outlook report on Thursday.

FILE PHOTO - Electricity pylons are silhouetted by the sunset of a clear autumn evening in the Kent countryside in Graveney, Britain, October 26, 2015. REUTERS/Dylan Martinez

National Grid increased its forecast for the surplus power margin to 6.2 gigawatts (GW), or 10.3 percent, this winter, compared with the 3.7-4.9 GW it forecast in June.

The increase is because this winter is the first delivery year of the government’s capacity market, which pays generators to ensure there are reliable sources of electricity supply.

This has raised the amount of available supply in the market, National Grid said in the report.

“We are confident that we have the right products and strategy in place to help us to balance the system, even under colder conditions than we have experienced in recent years,” the grid operator said.

National Grid expects gas demand to be slightly lower than last winter at 51 billion cubic metres (bcm), with peak demand seen at 502 million cubic metres (mcm) a day.

It expects strong supplies of gas from Europe through interconnectors and as a result there will be less export demand.

Even though Centrica (CNA.L) announced the permanent end to storage operations at its Rough gas storage site earlier this year, the company plans to extract all recoverable cushion gas from the field.

Centrica expects nearly 1 bcm of gas to be withdrawn from the facility this year. Last year, however, no withdrawals were possible from the site due to technical issues.

“Deliverability will start at around 12 mcm/day from early October falling to around 6 mcm/d as gas is withdrawn,” National Grid said.

“With the impending closure of Rough, there remains 1.4 bcm of storage space and 121 mcm/day of deliverability available across the remaining medium-range storage facilities,” it added.

There will be enough gas from a range of sources, including Norway, liquefied natural gas (LNG) and interconnector imports, to meet demand.

Britain received its first LNG cargo from the United States this July.

“However, very few cargoes from the US have been delivered to north west Europe and we are not anticipating any change in this for winter 2017/18,” the report said.

National Grid expects power demand to be 50.7 gigawatts (GW) in mid-December, similar to expectations last winter.

Reporting by Nina Chestney; editing by Jason Neely, Greg Mahlich

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