I’m dreaming of 2026…

Friends, a curious thought occurred to me yesterday:

“What would happen if the Hinckley C nuclear Power Station was completed on time in 2025?”

I know it’s unlikely but it is conceivable.

But whenever it does start operating, it will produce an extra 3.26 GW of electricity 24 hours a day, 7 days a week. This is enough to change the UK electricity generation “market” at a stroke.

 January 2020

To illustrate the effect that Hinkley C will have, I downloaded hourly generation figures for 10 days at the start of 2020.

I picked this range of dates because the data was free – I would need to have paid to obtain more data! But it is sufficient to make my point. Take a look at Gridwatch for monthly and yearly summaries.

I have not plotted all the generating sources or interconnectors bringing us electricity, but instead I have just drawn three curves from the data set.

  • Total Demand
  • Nuclear 
  • Nuclear + Wind

Click Image for a larger version. Generation from the first 10 days of 20 showing electricity from nuclear power stations, the sum of nuclear + wind generation, and total demand. The gap between the black and green curves is filled with electricity from a variety of sources, but mainly with electricity from gas-fired generators.

I have picked these data because of the way the UK grid is run. In simplified form, it works like this:

  • First the grid accepts all the nuclear electricity available. This is because (for technical reasons) nuclear power stations cannot easily change their output.
  • Then the grid accepts whatever renewable energy (solar or wind) that is available. This can be well-predicted a day or two ahead of time.
  • Then, through a complex system of contracts, and “market”-mechanisms, the grid adds electricity from a variety of sources to meet demand. Most of this is usually met by gas-fired generation which emits ~ 450 g CO2/kWh of electricity supplied.

But what would the situation look like if Hinkley C were operating, and wind generation were twice it’s value in 2020?

This situation could hypothetically occur as soon as 2026.

January 2026?

  • IF demand in January 2026 were by chance the same as in 2020, and…
  • IF Hinkley C were generating at full power and…
  • IF wind power was twice what it was in 2020…

…then we would find ourselves in the extraordinary situation depicted in the graph below.

Click Image for a larger version. A hypothetical situation in January 2026 when nuclear supply is supplemented 3.26 GW of generation by Hinkley C, and wind generation is twice what it was in 2020. The gap between the black and green curves is now routinely reversed – indicating a regular ‘oversupply’ of green electricity.

The graph shows that the combination of ‘nuclear + wind would’ regularly exceed demand before considering any other sources of generation.

During these periods demand would be met entirely with low carbon sources and the carbon intensity of UK electricity would fall to pleasingly low values (~50 gCO2/kWh).

And during these periods – shown in blue on the graph above – there would be typically 10 GWh a day of ‘surplus electricity’.

The marginal cost of this ‘surplus’ electricity is debatable, but it is close to zero.

Could this really happen?

Yes. It has already happened briefly this year over the late May bank holiday weekend. And as renewable electricity generation grows, such situations will occur ever more frequently.

And whenever Hinkley C comes on stream – in 2025 or later – such events will inevitably become commonplace.

What are the consequences?

I don’t know!

The electricity “market” operates by complex rules, and as this year’s ‘odd’ May weekend event showed, prices cannot just fall to zero, but actually become negative: i.e. companies will pay you to use their electricity!

But however it is dealt with by the “market” rules, the reality is that the UK will be routinely generating renewable electricity in excess of demand at a cost close to zero. This has consequences at many levels.

  • First of all: from the point of view of investors looking to build renewable generation – solar or wind – they will no longer be able to ‘dump’ electricity onto  “the market” whenever the Sun happens to shine and the wind happens to blow. This will make life more difficult for these investors.
  • Secondly: anyone who can store energy for later re-sale or re-use will have access to very low cost electricity. This represents an opportunity for many nascent industries and technologies.

However the biggest consequence could be a change in conception of how the “market” operates. So far, we have almost always assumed that supply will adjust to meet demand. We have had some incentives to use ‘off-peak’ electricity, but not many.

With an ‘oversupply’ of electricity, there will be opportunities for industries which can adjust demand to meet available supply. If this is implemented well, then the economic singularities arising from a zero price will be avoided – but the energy should still be cheap and it will still be green.

Opportunities

If green hydrogen is ever to play a role in the UK, then this could present an initial opportunity. 10 GWh/night of electricity is sufficient to generate 200 tonnes of hydrogen (@50 kWh/kg).

If EV use grows at the rate that many anticipate, then smart charging at night could help sustain that growth. 10 GWh/night would be enough to deliver 25 kWh (roughly a 50% charge) to 400,000 EVs.

I am sure many more ideas will emerge about how to reap this low-cost, low-carbon harvest.

Conclusion

So the conclusion of my whimsy is that whenever Hinkley C starts generating it will transform the UK electricity supply “market” overnight. And this could happen sooner than I had anticipated.

Whenever it happens, it will significantly reduce the average CO2 emissions from electricity in the UK. But there will also be costs associated with this ‘cheap’ electricity.

You might consider it ironic – and perhaps not a little unfair – that the introduction of some of the most expensive electricity ever put onto the UK grid – EDF are guaranteed ~10.6 p/kWh for all the electricity that Hinkley C produces – will put pressure on generators using wind turbines and solar PV stations – the suppliers of the cheapest energy ever supplied to the grid.

You might consider that this is not how “markets” are supposed to work. That is why I have put every instance of the word “market” in quotation marks. If you know a better word to use, I would love to know what it!

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s


%d bloggers like this: