Monday, November 14, 2011

All Things Being Equal

Cockenzie Power Station 01

It has been a long-running sore that Scottish energy generators, renewables in particular, are charged more to put their power onto the National Grid than their Southern English counterparts. That may be about to change.

Ofgem has for a long time had a system for regulating transmission charges that depended on how close to civilisation your power plant was. Civilisation is classed as the South East of England. That's where the majority of the population of the UK is housed, and therefore that's where the majority of the power is needed. It follows, therefore, that the closer you are to that population then the less you should be charged to transmit your energy to them.

I'm sure it made sense to someone. But in the era of renewable and decentralised energy, it's a bad model. The best places to produce renewable electricity are nowhere near where the majority of people live.

The Scottish Government have been lobbying Ofgem and the National Grid to review their transmission prices for some time, and now the BBC are reporting that a new study for Ofgem reckons that costs to put energy into the Grid from the north of Scotland could fall 80%.

That makes renewables far more attractive to the energy companies, and also undermines the need for "cheap" nuclear power plants in England. Let's hope the study leads to a level playing field for all.

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