London Staves Off Power Outage by Paying 5000% Higher Rate for Electricity

National Grid’s Electricity System Operator (ESO) paid €11,633.79 per megawatt hour (more than 5000% higher than the usual price) to avoid an outage in southeast London last Wednesday.

South East London Combined Heat and Power, a major energy-from-waste incineration plant in South Bermondsey, London, designed to generate both heat and electricity. Credit: Bill Bertram, Pixel8, CC BY-SA 3.0, Wikimedia Commons

London nearly had a power blackout last week, forcing the UK to pay Belgium a record price for electricity to keep the capital connected. National Grid’s Electricity System Operator (ESO) paid €11,633.79 per megawatt hour (more than 5000% higher than the usual price) to avoid an outage in southeast London last Wednesday.

Extreme heat across the European continent saw soaring demand for power as people cranked up fans and air conditioning, especially in the UK, where temperatures surged above 40°C for the first time ever. A bottleneck in the grid added to pressures on the system, leaving Britain with no alternative but to pay its highest ever price for electricity. Planned maintenance, outages of overhead lines and a storm in Belgium that impacted solar power caused further issues.

The transaction could see households pay more in their upcoming energy bills as energy suppliers pass on the costs. A spokesperson at National Grid ESO said a specific circuit had been needed to get electricity to the right place. “We were bidding in a tight market and market prices were high that day because Europe also wanted the energy,” they said. “We managed the system and kept the electricity flowing to the South East.”

The UK relies on importing electricity from interconnectors overseas, especially France, Belgium and the Netherlands. Only a small quantity of electricity was purchased at the record price, reportedly enough to supply eight houses for a year.

- News
July 30, 2022
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Rauf Fattakh

Managing Director & Co-Founder of Prospero Events Group. He is passionate about climate change, conferences business, entrepreneurship and leadership. He co-founded Prospero Events to help decision-makers in the European energy industry benchmark best practices by organizing peer-to-peer conferences. Privately a great fan of Arsenal Football Club.