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UK energy regulator repeats warning on blackouts

Ofgem, the British energy regulator, has warned again of the danger of shortages in power generation in the UK, saying that it expects the potential for power cuts to increase towards the middle of this decade as ageing power stations begin to close.

The regulatory agency said the margin of electric capacity over demand could narrow to between 2 per cent and 5 per cent by 2015 and 2016 and added that the probability of such disruptions would increase from one in 47 years now to around one in 12 years for 2015/16.

Ofgem

If the projected decline in demand does not materialise, margins could fall to 2 per cent.

Ofgem said the findings illustrate the need for timely implementation of the Department of Energy and Climate Change’s (DECC) capacity market.

The regulator has been working with DECC and National Grid to explore options that would offer consumers with additional safeguards against the increased risk to mid-decade security of supply.

“This is why Ofgem welcomes DECC’s commitment to introduce a capacity market that will provide a longer term solution to this problem at a time when Britain’s energy industry is facing an unprecedented challenge to secure supplies,” Ofgem chief executive Andrew Wright said.

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