The Department of Energy Security and Net Zero (DESNZ) has asked National Grid ESO to explore the potential of extending contingency coal contracts into next winter, but all five units will be unavailable.
At the operator’s Operational Transparency Forum yesterday (15 March), the ESO confirmed that it had received a letter from the Government requesting that it explores the procurement of non gas-fired capacity over the coming 2023/24 winter, which would otherwise not be available.
National Grid ESO will therefore begin negotiating with market participants to secure additional capacity. These will be commercially sensitive, and the operator will therefore not provide a running commentary on the process, but will inform the market of the implications of any agreed contracts once completed.
The request follows this winter’s contingency coal units being used for the first time last week during a cold snap of weather. Two coal units at West Burton power station ran from just before 14:00 on Tuesday 7 March till around 20:30, adding capacity during a particularly constrained period as demand hit its 10th highest point of the winter whilst wind generation stayed low and interconnectors capacity was insecure due to strikes in France.
In addition to EDF’s two coal units at West Burton, Drax also warmed two of its units last Tuesday in anticipation of potential use.
This was the fifth time that the units have been warmed this winter, with the instruction issued by the operator on 7 February, 26 January, 23 January and 12 December, but ultimately they weren’t used on those occasions.
Contingency contracts: National Grid ESO’s last-resort
|West Burton A (EDF)||2 x 400MW||1 Oct 2022 – 31 Mar 2023|
|Drax||2 x 570MW||1 Oct 2022 – 31 Mar 2023|
|Ratcliffe (Uniper)||1 x 480MW||Nov 2022 – 31 Mar 2023|
The use of the coal units is the final Enhanced Action the ESO has at its disposal, as set out by the in its Autumn Markets Forum in September. The units give the ESO an additional 2.5GW of buffer capacity.
However, thanks to strong wind generation and mild weather, the winter has not been as straining as feared, limiting the number of Enhanced Action’s that the operator has had to take.
Keeping the units online over the winter is set to cost between £340 million and £395 million, subject to the procurement and use of the coal.
Continued use of coal contracts?
Despite the Government’s interest in continued use of coal energy contracts for the coming winter, the availability of power stations is limited. Of the five units that have been available over the past winter, none are expected to sign contingency contracts for 2023/23.
On 1 March, EDF sent a letter to the Secretary of State outlining that it will close the two remaining units at West Burton A at the end of March, irregardless of the call for continued use.
“The two remaining units at West Burton A coal fired power station in Nottinghamshire will close as planned on 31 March 2023, in line with the agreement signed last year. The station and its workforce have fulfilled the request to have 400MW available through Winter ‘22/23 as an emergency standby option,” a spokesperson for EDF told Current±.
“There are a number of workforce and operational reasons that mean extending the life of West Burton A again is very challenging.”
“For example, retaining suitably qualified and local personnel to ensure safe operation was a major challenge last year and, looking forward, becomes untenable as many of the workforce have stayed on well beyond planned retirement dates already. Approximately half the staff are retiring by Q2 this year. Notices have already been given for around half of these and they leave early April. This includes a large part of the station leadership team.”
EDF added that the focus of its power generation business is on keeping as much of its nuclear fleet – which has a total capacity of 5.7GW – available as possible. Earlier this month, the company announced that it was extending the lifetime for its Hartlepool and Heysham power stations out to March 2026, as part of this focus.
Beyond West Burton, Drax is also planning to close its coal units before the next winter as it focuses on bioenergy.
A Drax spokesperson told Current±: “At the request of the UK Government, Drax agreed to temporarily delay the planned closure of its two coal-fired units to help bolster the UK’s energy security this winter. Our coal units will close in March 2023 when this agreement comes to an end.
“The extension was a complex staffing, logistical and engineering project after a significant reorganisation of the power station was already completed to bring almost 50 years of coal-fired generation to an end. With two major maintenance outages planned on our biomass units this summer, and a number of certifications expiring on the coal-fired units, the units would not be able to operate compliantly for winter 2023.”
The final coal unit to sign a contract for the past winter was Uniper’s 480MW Ratcliffe-on-Soar, which has subsequently taken the decision to stay operational till 2024 – when the ban on coal use comes in – and therefore successfully bid into the T-1 Capacity Market auction.
A spokesperson for Uniper said: “Uniper’s Ratcliffe power station already has capacity market agreements in place for all four units for winter 23/24, so would not be part of a separate winter contingency contract for this period.”