The Quiet Driving Force Behind Rising Curtailment Costs in Great Britain

Summary

By Callum MacIver and Keith Bell. The curtailment of output from wind farms due to lack of network capacity and the associated costs of balancing the system have become a key focal point in the current debate in the electricity sector about the extent to which the system is “broken”. They are also a key driver behind calls being made in some quarters for radical market reform to better align what the market dispatches with the physical realities of the system, i.e. to reduce the need for the system operator to take balancing actions. In this blog, we set out to dig a little deeper into the current state of wind curtailment. In particular, we seek to examine the role of transmission system availability (or rather unavailability), something that is often absent from the discussion. Spoiler: It is very influential! But first, some background is required. What is wind curtailment? The National Energy System Operator (NESO) is tasked with balancing generation and demand in real-time in Great Britain (GB) via the Balancing Mechanism (BM). The market provides NESO with a set of half-hourly generator, storage and interconnector ‘physical notifications’ based on those actors’ positions in forward, day-ahead and intra-day trading markets. At ‘gate closure’ – 1 hour ahead of each delivery period – NESO takes over. Their task involves managing any errors in forecasts of supply or demand, or subsequent changes in circumstance. It also increasingly involves unravelling any market dispatches that are not physically feasible within the system, respecting various constraints such as limits to the amount of power transmission lines can carry without becoming too hot, i.e. thermal constraints, voltage limits and a need for a certain minimum amount of system inertia. Costs arise due to each of these factors, but thermal constraints are the single biggest driver of the high and increasing costs for system balancing, in the main due to the need to curtail surplus wind energy in export-co...