UK power prices turned negative for nine consecutive hours on Sunday in what’s been billed as an “extraordinary turn of events” for the country’s electricity system.
Unusually low demand, some 2GW below forecasts, combined with high wind generation to send prices spiralling, and National Grid was even forced into instructing onshore and offshore wind farms to turn down their generation.
Between the hours of 12:00pm and 9:00pm on Sunday 26 May, the UK endured an extended period of negative pricing, with wholesale power prices falling to as low as -£71.26/MWh.
National Grid Electricity System Operator’s daily balancing report for 26 May 2019 reveals that the SO paid more than £6.6 million on balancing costs, having spent just £300,000 the day before, providing an indication as to the scale of the volatility experienced on the system throughout the day.
At nine hours long, it amounts to the longest consecutive period of negative pricing the UK has encountered and has been described as “unprecedented” by energy tech company Limejump, which acts within the balancing mechanism.
In addition, after a slight recovery, the market dipped back into negative pricing between 11:45pm on Sunday and 1:45am on the morning of Monday 27 May, meaning that negative prices were in action for around 11 hours within a 24 hour period.
The instances of negative pricing left the average system price for power on Sunday 26 May at -£12.16/MWh.
Those prices were essentially created by low demand. The average power demand on Sunday was just 25.4GW, while the minimum demand in that period was 19.8GW, recorded between 3:45am and 4:15am, right towards the lower end of minimum demand forecasts within National Grid’s 2019 Summer Outlook.
The event comes just two months after the previous long run of negative system prices, a period of six hours which occurred on Sunday 24 March that witnessed system prices fall to similar lows.
Limejump said in a trading note issued to customers: “The question traders have been asking themselves earlier this year – ‘Are negative system prices an anomaly or are they here to stay?’ – has now been answered without a doubt by these an a number of other observed similar scenarios.”
Speaking to Current±, a Limejump spokesperson said that those operating battery storage plants over the weekend were obvious winners.
"Smart trading strategies deliver great revenue especially those with accurate forecasting. Batteries that were charging during these negative prices time frame, including Limejump's, were definitely happy recipient."
It was also a significant weekend for the carbon intensity of the grid, which at times dipped well below the 100g CO2/kWh threshold required to comply with the Fifth Carbon Budget. Sunday afternoon saw carbon intensity dip to just 69g CO2/kWh on the back of surging wind and solar activity.
Coal meanwhile is in the midst of yet another record breaking absence from the UK’s power mix, having not generated for more than 250 hours, equivalent to almost 11 days. Only earlier this month Britain celebrated its first coal-free month since the Industrial Revolution, and coal has now experienced more than 1,500 hours off the grid in 2019.
Wind meanwhile spent large portions of Sunday afternoon providing more than 11GW of power, equivalent to 37-39% of total demand.