The UK power system experienced a notable decline in grid balancing costs in June.
That’s according to recent data released by National Grid ESO, which shows that balancing costs decreased by 14%, reaching £112.7 million, compared to the previous month’s expenses.
Balancing costs are the expenses incurred to ensure a steady balance between electricity supply and demand in the power system.
These costs are created when National Grid ESO has to buy additional energy from generators – this might happen due to adverse weather conditions or if a power generator fails.
Balancing costs stood at £132 million in May and £198 million in April.
The system operator added that in comparison to June 2022, constraint costs witnessed a substantial £150 million decrease in June, primarily attributed to significantly fewer actions taken, including 700GWh less wind generation and more than 100 fewer planned outages.
Additionally, lower average wholesale prices in June 2023, standing at £86/MWh compared to the previous year’s £157/MWh, also contributed to the reduced constraint costs.
Moreover, compared to May 2023, constraint costs were £25.7 million lower in June.
