Tag: electric insights

How to count carbon emissions

Reduced demand, boosted renewables, and the near-total abandonment of coal pushed last quarter’s carbon emissions from electricity generation below 10 million tonnes.

Emissions are at their lowest in modern times, having fallen by three-quarters compared to the same period ten years ago.  The average carbon emissions fell to a new low of 153 grams per kWh of electricity consumed over the quarter.

The carbon intensity also plummeted to a new low of just 18 g/kWh in the middle of the Spring Bank Holiday.  Clear skies with a strong breeze meant wind and solar power dominated the generation mix.

Together, nuclear and renewables produced 90% of Britain’s electricity, leaving just 2.8 GW to come from fossil fuels.

The generation mix over the Spring Bank Holiday weekend, highlighting the mix on the Sunday afternoon with the lowest carbon intensity on record

National Grid and other grid-monitoring websites reported the carbon intensity as being 46 g/kWh at that time.  That was still a record low, but very different from the Electric Insights numbers.  So why the discrepancy?

These sites report the carbon intensity of electricity generation, as opposed to consumption.  Not all the electricity we consume is generated in Britain, and not all the electricity generated in Britain is consumed here.

Should the emissions from power stations in the Netherlands ‘count’ towards our carbon footprint, if they are generating power consumed in our homes?  Earth’s atmosphere would say yes, as unlike air pollutants which affect our cities, CO2 has the same effect on global warming regardless of where it is produced.

On that Bank Holiday afternoon, Britain was importing 2 GW of electricity from France and Belgium, which are mostly powered by low-carbon nuclear.  We were exporting three-quarters of this (1.5 GW) to the Netherlands and Ireland.  While they do have sizeable shares of renewables, they also rely on coal power.

Britain’s exports prevented more fossil fuels from being burnt, whereas the imports did not as they came predominantly from clean sources.  So, the average unit of electricity we were consuming at that point in time was cleaner than the proportion of it that was generated within our borders.  We estimate that 1190 tonnes of CO2 were produced here, 165 were emitted in producing our imports, and 730 avoided through our exports.

In the long-term it does not particularly matter which of these measures gets used, as the mix of imports and exports gets averaged out.  Over the whole quarter, carbon emissions would be 153g/kWh with our measure, or 151 g/kWh with production-based accounting.  But, it does matter on the hourly timescale, consumption based accounting swings more widely.

Imports and exports helped make the electricity we consume lower carbon on the 24th, but the very next day they increased our carbon intensity from 176 to 196 g/kWh.

When renewable output is high in Britain we typically export the excess to our neighbours as they are willing to pay more for it, and this helps to clean their power systems.  When renewables are low, Britain will import if power from Ireland and the continent is lower cost, but it may well be higher carbon.

Two measures for the carbon intensity of British electricity over the Bank Holiday weekend and surrounding days

This speaks to the wider question of decarbonising the whole economy.

Should we use production or consumption based accounting?  With production (by far the most common measure), the UK is doing very well, and overall emissions are down 32% so far this century.  With consumption-based accounting it’s a very different story, and they’re only down 13%*.

This is because we import more from abroad, everything from manufactured goods to food, to data when streaming music and films online.

Either option would allow us to claim we are zero carbon through accounting conventions.  On the one hand (production-based accounting), Britain could be producing 100% clean power, but relying on dirty imports to meet its entire demand – that should not be classed as zero carbon as it’s pushing the problem elsewhere.  On the other hand (consumption-based accounting), it would be possible to get to zero carbon emissions from electricity consumed even with unabated gas power stations running.  If we got to 96% low carbon (1300 MW of gas running), we would be down at 25 g/kWh.  Then if we imported fully from France and sent it to the Netherlands and Ireland, we’d get down to 0 g/kWh.

Regardless of how you measure carbon intensity, it is important to recognise that Britain’s electricity is cleaner than ever.

The hard task ahead is to make these times the norm rather than the exception, by continuing to expand renewable generation, preparing the grid for their integration, and introducing negative emissions technologies such as BECCS (bioenergy with carbon capture and storage).


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Front cover of Drax Electric Insights Q2 2020 report

Electric Insights Q2 2020 report [click to view/download]

The cost of staying in control

What: Industrial landscape with cables, pylons and train at sunset Where: Somerset, UK When: January 2016

The cost of keeping Britain’s power system stable has soared, and now adds 20% onto the cost of generating electricity.

The actions that National Grid takes to manage the power system have typically amounted to 5% of generation costs over the last decade, but this share has quadrupled over the last two years.  In the first half of 2020, the cost of these actions averaged £100 million per month.

Supplying electricity to our homes and workplaces needs more than just power stations generating electricity.

Supply and demand must be kept perfectly in balance, and flows of electricity around the country must be actively managed to keep all the interconnected components stable and prevent blackouts.  National Grid’s costs for taking these actions have been on the rise, as we reported over the previous two summers; but recently they have skyrocketed.

At the start of the decade, balancing added about £1/MWh to the cost of electricity, but last quarter it surpassed £5/MWh for the first time (see below).

Balancing prices have risen in step with the share of variable renewables.  The dashed line below shows that for every extra percent of electricity supplied by wind and solar adds 10 pence per MWh to the balancing price.  Last quarter really bucks this trend though, and balancing prices have risen 35% above the level expected from this trend.  The UK Energy Research Centre predicted that wind and solar would add up to £5/MWh to the cost of electricity due to their intermittency, and Britain has now reached this point, albeit a few years earlier than expected.

This is partly because keeping the power system stable is requiring more interventions than ever before.  With low demand and high renewable generation, National Grid is having to order more wind farms to reduce their output, at a cost of around £20 million per month.  They even had to take out a £50+ million contract to reduce the output from the Sizewell B nuclear reactor at times of system stress.

Two charts illustrating the costs of balancing Great Britain's power system

[Left] The quarterly-average cost of balancing the power system, expressed as a percentage of the cost of generation. [Right] Balancing price shown against share of variable renewables, with dots showing the average over each quarter

A second reason for the price rise is that National Grid’s costs of balancing are passed on to generators and consumers, who pay per MWh.  As demand has fallen by a sixth since the beginning of the coronavirus pandemic, the increased costs are being shared out among a smaller baseOfgem has stepped in to cap the balancing service charges at a maximum of £10/MWh until late October.  Their COVID support scheme will defer up to £100 million of charges until the following year.

For a quarter of a century, the electricity demand in GB ranged from 19 to 58 GW*.  Historically, demand minus the intermittent output of wind and solar farms never fell below 14 GW.  However, in each month from April to June this year, this ‘net demand’ fell below 7 GW.

Just as a McLaren sports car is happier going at 70 than 20 mph, the national grid is now being forced to operate well outside its comfort zone.

This highlights the importance of the work that National Grid must do towards their ambition to be ready for a zero-carbon system by 2025.  The fact we are hitting these limits now, rather than in a few years’ time is a direct result of COVID.  Running the system right at its limits is having a short-term financial impact, and is teaching us lessons for the long-term about how to run a leaner and highly-renewable power system.

Chart: Minimum net demand (demand minus wind and solar output) in each quarter since 1990

Minimum net demand (demand minus wind and solar output) in each quarter since 1990


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Front cover of Drax Electric Insights Q2 2020 report

Electric Insights Q2 2020 report [click to view/download]

Under lockdown, every day is a Sunday

empty UK motorway in England at sunset with no traffic

On March 23rd the UK took an unprecedented move to tackle the coronavirus. Most business that had not already closed moved online, with millions of people now working from home. This had a huge impact on electricity demand: consumption on weekdays fell by 13% to its lowest levels since 1982 – a time when there were 10 million fewer people in the country, and GDP was a third lower than today.

Other regions have seen a similar collapse in electricity demand. Spain, Italy and France have all seen electricity demand fall by 10-15% according to analysis by Ember. Across the Atlantic, New York City has seen similar reductions.

Demand has fallen for a simple reason: with schools and workplaces now closed or running with a greatly reduced staff – machinery, computers, lights and heaters are not drawing power. Electric rail, tram and tube systems are also running a reduced service. On the contrary, with more people at home, household electricity consumption has increased. Octopus Energy estimate that during social distancing (before the stricter lockdown came into effect) homes were consuming up to a third more electricity, adding £20 per month to the typical bill.

The impact of lockdown on Britain’s electricity demand is much like living through a month of Sundays. The average profile for a March weekend day in previous years looks very similar to the daily profile for weekdays since lockdown begun – both in the amount of electricity consumed and the structure. Post-lockdown weekends have even lower demand, tracking 11% below weekday demand.

People no longer have to get up at the crack of dawn for work. On a typical weekday morning, demand would rise by 10 GW over two hours from 5:30 to 7:30 AM. Now it takes more than twice as long – until midday – for this rise to occur. At the other end of the day, there would normally be a small peak in demand around 8 PM from people gathering in pubs and restaurants up and down the country. Both on weekdays and weekends, demand begins falling earlier in the evening as the sofa has become the only available social venue.

urban street cafe empty without visitors

With lower demand comes lower power prices. Wholesale electricity prices are typically 7% lower on Sundays than on weekdays for this reason. March saw the lowest monthly-average power price in 12 years, down one-third on this month last year. Prices were already heading downwards because of the falling price of gas, but the lockdown has amplified this, and negative prices have become commonplace during the middle of the day. There was not a visible impact on carbon emissions during the first quarter of the year, as only the last week of March was affected. However, as lockdown continued into April and May, emissions from power production in Britain have fallen by 35% on the same period last year. The effect is slightly stronger across Europe, with carbon emissions falling almost 40% as dirtier coal and lignite power stations are being turned down.

Will some of these effects persist after lockdown restrictions are eased? It is too early to tell, as it depends on what long-lasting economic and behavioural changes occur. Electricity demand is linked with the country’s GDP, which is set to face the largest downturn in three centuries. Whether the economy bounces back, or is afflicted with a lasting depression will be key to future electricity demand. It will also depend on behavioural shifts. People are of course craving their lost freedoms, many may appreciate not going back to a lengthy daily commute – and the rise of video conferencing and collaboration apps has shown that remote working may finally have come of age. With even a small share of the population continuing to work from home on some days, there could be a lasting impact on electricity demand for years to come.


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