MARKET FOCUS EDITOR’S CHOICE


Are planning laws to blame FOR THE ENERGY CRUNCH?


The lights nearly went out on 4 November 2015. According to the national press, all our combined power plants couldn’t produce the electricity UK Plc needed. National Grid was forced into emergency measures, paying extortionate prices for electricity and cutting supplies to large power users to narrowly avert disaster. Douglas Ainsley, Associate in the Planning and Infrastructure department at Bircham Dyson Bel reports


these are indicative of recent innovation, not an unprecedentedly panicked Grid. National Grid had further measures in reserve had these measures been inadequate. We were some way away from a blackout. Nonetheless, while not a sign of an


A


ctually, it wasn’t nearly that dramatic. A number of power plants all failed at


once, at a time the weather (foggy and still) was inimical to electricity generation - a set of circumstances that probably won’t recur with great frequency. National Grid deployed


measures carefully designed to deal with just this sort of scenario. The wholesale price of electricity didn’t soar – National Grid paid a pre-agreed higher price for electricity generated from reserve capacity. Novel demand side measures were deployed – but


Figure 1: Hinkley Point C


impending apocalypse, the deployment of these measures by National Grid is rare – similar measures were last used in 2012. So this does point to a lower than normal capacity margin – reportedly down to 1.2% from a peak of 16.8%. It seems we are in the midst of a short-term energy crunch. And with a number of coal plants scheduled for closure next year, it will get worse before it gets better (albeit several of those closing are the same plants that went down to cause the recent problems, so perhaps we won’t miss them that much). How have we got here? “Planning constraints” are often blamed for lack of housing supply – would critics be right to blame our present problems on a restrictive planning system that chokes off new generation development? In a word, no.


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