Storm Amy brings negative electricity prices to UK

Stay informed with free updates

Simply sign up to the UK energy myFT Digest — delivered directly to your inbox.

The UK is set to experience a joint record stretch of negative electricity prices on Saturday as Storm Amy drives huge amounts of wind power into the grid. 

Wholesale power prices will be negative for 17 hours from late Friday night, matching a record set in May, with the National Grid forecasting 20 gigawatts of wind power from the storm, more than three-quarters of the country’s total electricity demand. 

The current record day for wind power in the UK was in December last year, when generation hit 22.5GW. 

But Fintan Devenney, senior energy analyst at Montel, suggested the actual wind generation from the storm may be far lower than the forecasts. He said that wind farms might switch off if high winds threatened to damage turbines, if their subsidies were endangered by negative prices, and if the grid itself could not manage the surge in generation. 

“There’s very little grid infrastructure to move all that power down from Scotland where there are no people to use it all, so it is the system operator’s responsibility to pay those wind farms to shut down and that incurs a cost,” he said. 

Negative prices for electricity have become increasingly common throughout Europe as more renewables are added to the grid. UK power prices hit a low of -£19.10 in early September, for example, but long stretches of negative prices remain rare. 

UK wholesale power prices turn negative when there is too much electricity generation, often from wind and solar, and not enough demand, so the grid needs buyers to take the excess in order to remain balanced. 

In those moments, it can be cheaper for power plants to pay others to use electricity than to switch off their generators. Households tend not to see the dips, which are smoothed out by retail tariffs, but large industrial users can sometimes be paid to use more electricity when the grid has an excess. 

Amber alerts for Storm Amy have been put in place for parts of Scotland and Northern Ireland, with wind speeds of more than 95mph expected, according to the UK’s weather forecasters.