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Record wind output sends UK into negative pricing

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Electricity produced by the UK’s wind turbines reached record levels this week after 13.6GW of output was recorded which, combined with high output, sent settlement periods into negative pricing.

Data compile by Drax Electric Insights showed generation from UK wind farms topped 10GW for the first time on Saturday 13 January before rising as high as 13.6GW on Wednesday (17 January). Wind also reached new heights in proportional delivery of electricity, with as much as 41.6% of the UK’s demand being met by wind during one settlement period this week.

While not as high, wind generation output ranging from 7.3-7.9GW combined with low demand in the morning of Sunday 14 January drove UK power system prices into negative margins.

Electricity data from utility company Elexon, which delivers National Grid’s Balancing and Settlement Code (BSC), shows that system buy and sell prices fell to -£3.71/MWh between 6-6:30pm and remained negative for four consecutive settlement periods.

For settlement period 15 (7-7:30am 14 January), it fell as low as -£68.43/MWh.

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System pricing fell into negative for four consecutive settlement periods between 6-8am on 14 January. Image: Elexon.

A trader told commodities news outlet Platts the dip was a result of National Grid having to pay wind farms to “turn off”, with another saying: "I can imagine that the must run was too high to absorb the additional wind. Too high, as in not flexible enough.”

Platts added that National Grid had forecast demand for peak times on Sunday to be 44.60 GW, while actual demand was 43.7 GW.

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