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UK falls back on fossil fuels to secure winter energy supply

Contracts worth £122m to keep coal and gas-fired power stations on standby will help Britain avoid electricity blackouts this winter, National Grid has forecast, highlighting the difficulties facing the UK as it attempts to wean its power sector off fossil fuels.

The UK’s electricity system operator forecast that the margin between supply and demand over the course of the winter would be 6.6 per cent, an increase of almost 30 per cent on last year’s cushion and wider than a provisional forecast made in July.

However, without measures to ensure the availability of back-up generating capacity when regular supplies run low, the margin this winter would be close to record lows at 1.1 per cent, according to National Grid’s annual Winter Outlook.

National Grid will pay for 10 coal and gas-fired plants to keep spare capacity on standby, with further sums to be paid if they are called into action. These include coal plants at Eggborough in Yorkshire and Fiddlers Ferry in Cheshire that had previously been earmarked for closure.

The dependence on fossil fuels to guarantee energy security during the winter months highlights the challenge facing the UK government as it seeks to phase out coal-fired power by 2025 in pursuit of aggressive carbon reduction goals.

Britain experienced its first day without any coal-fired electricity production for 134 years in April and in the subsequent six months the UK got more power from solar than coal. However, solar power is far less effective in the gloomy British winter and, according to National Grid, wind power can be assumed to be available for only 21 per cent of the time.

The supply challenge is set to become increasingly acute in coming years as decommissioning of ageing nuclear reactors adds to pressure from the closure of coal plants. About 60 per cent of UK generating capacity in 2010 is forecast to have disappeared by 2030.

The simultaneous need to replace lost capacity while reducing carbon emissions led to the government’s decision last month to approve an £18bn nuclear plant at Hinkley Point in Somerset, despite widespread criticism of the project’s high cost.

However, some analysts said National Grid’s success in maintaining a supply buffer during a period of transition in the energy sector demonstrated that scare stories about a looming supply crunch were overblown.