PARLIAMENTARY WRITTEN QUESTION
Electricity Generation (27 May 2015)

Electricity capacity assessments by Ofgem and National Grid, as well as our own modelling at DECC, have consistently shown tight capacity margins in the years between now and the first Capacity Market delivery year (2018/19) if we did not have National Grid’s New Balancing Services.

Earlier today, National Grid announced the results of the second round of its competitive tender for New Balancing Services in winter 2015/16. They have announced that almost 1.9GW of capacity has been secured through the second tender round, bringing the total secured for this winter to 2.56GW. This is additional reserve capacity that will be kept on standby outside the market in case it is needed. The announcement is available here:

http://media.nationalgrid.com/press-releases/uk-press-releases/corporate-news/additional-reserve-secured-for-winter-1516/

We expect this to mean adequate margins to meet the reliability standard this winter, even in scenarios where the system is under stress, such as during exceptionally cold weather. Further information on the impact of NBS on the overall market position for winter 2015/16 will be published in July.