Interconnectors have changed direction

[Nicholas Lewis]

no, the wind farms receive their CFD price whatever the market price is doing; any difference is backed off by Government through the contract. When the CFDs were set it was expected that Government would be paying the generators, ie because the market price was typically below the strike price. For example, the East Anglia 1 wind farm had a CFD at £114 per MWh, which with the market price at say £40/MWh meant that Government would pay it £74 to make up the difference. (Which with over 700MW on tap soon racks up). Now however with high market prices, the same generators will be paying anything over the CFD price back to Government. The nearly completed Hornsea 2 and Moray East wind farms both have CFDs at £57.50 / MWh, and between them will generate over 2GW on windy days. If this October is like last October for price and wind, U.K. Gov will receive about £60-70m from these two combined for the month (if I’ve done my sums right!)

Moray East owners have outsmarted govt and are exploiting a hole in the contract that gives them the right to not actualise the CfD for a year which they are currently taking advantage of (as long as the wind is blowing of course!). The other thing to note is the strike price gets adjusted by inflation so the 57.50 is upto 68.55. This uplift applies to all CfDs and EA 1 adjusted strike price is now at 150.68. Mind you given the system price today has been upto 500/MWh some half hours the CfD have turned out to be good choice despite all the criticism levelled at the system when it was introduced.

== Doublepost prevention - post automatically merged: 26 Jul 2022 ==

Current installed wind capacity is 25GW, but the best we can usually get on a day with good wind speeds widespread is around 14-15GW. I'm not exactly sure why, but one suggestion is the grid is not extensive and efficient enough to get wind power from all farms to somewhere where power is needed, so in this instance if 25GW potential existed on a given day, 10GW approx. would be completely redundant. There was recently an announcement for a major National Grid upgrade amounting to £54bn that will help cater for increasing offshore wind capacity going forward, so it sounds like this potential issue is being addressed.

Correct NG is forced to constrain off the grid huge amounts of wind energy when wind conditions are good due to the grid transmission system being inadequate especially from North Scotland down through the Central Belt into Northern England. The windmill owners get paid to switch off and the gas turbine get to charge high rates for backfilling the lost generation driving up the system marginal price. NG have spent 425m since 1/4/22 on constraint management interventions in a little over 3 1/2mths and thats with lower wind this time of the year. This is particularly acute in North Scotland/Borders where loads of onshore wind has been connected to inadequate grid infrastructure and SSE need billions to reinforce the grid but no one wants OH pylon routes so much of it is being cabled at about six times the cost as OHL oh and the cost gets added to our bills.

 

[najaB]

and SSE need billions to reinforce the grid but no one wants OH pylon routes so much of it is being cabled at about six times the cost as OHL oh and the cost gets added to our bills.

I quite like pylons. Sad really.

 

[brad465]

I quite like pylons. Sad really.

I was very obsessed with them as a child (don't worry I don't mean wanting to climb them) and to an extent still am.

Correct NG is forced to constrain off the grid huge amounts of wind energy when wind conditions are good due to the grid transmission system being inadequate especially from North Scotland down through the Central Belt into Northern England. The windmill owners get paid to switch off and the gas turbine get to charge high rates for backfilling the lost generation driving up the system marginal price. NG have spent 425m since 1/4/22 on constraint management interventions in a little over 3 1/2mths and thats with lower wind this time of the year. This is particularly acute in North Scotland/Borders where loads of onshore wind has been connected to inadequate grid infrastructure and SSE need billions to reinforce the grid but no one wants OH pylon routes so much of it is being cabled at about six times the cost as OHL oh and the cost gets added to our bills.

Hopefully the £54bn upgrade recently announced will address this. My view on pylons is that in designated National Parks and AONB areas they should be avoided and transmission done by cables, if this isn't possible then low voltage lattice pylons that are not very high off the ground can be used. Everywhere else they can be constructed in accordance with available land space and necessary routing.

 

[ABB125]

I quite like pylons. Sad really.

Likewise. There's something about them that I can't quite place that appeals to me...