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Tom Edwards @notionalgrid.bsky.social · 06/10/2026

minimum margin at 17.30 3.8GW, LoLP of 0.000037, so things look OK but the control room needs some extra comfort

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Tom Edwards @notionalgrid.bsky.social · 06/10/2026

Another margin notice update this morning, covering 15.00 to 23.00

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Tom Edwards @notionalgrid.bsky.social · 28/09/2026

NESO has now cancelled the Electricity Margin Notice

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Tom Edwards @notionalgrid.bsky.social · 28/09/2026

Update; the system margin shortfall has reduced to 104MW

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Tom Edwards @notionalgrid.bsky.social · 28/09/2026

The de-rated margin looks healthy at 6GW, so no capacity market warnings. The notice suggests the control room is concerned about having sufficient margins to manage unexpected changes in demand or generation, with 1900MW behind constraints and a shortfall of 1400MW, against their requirements.

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Tom Edwards @notionalgrid.bsky.social · 28/09/2026

NESO issued a Electricity Margin Notice last night for 16.00 to 19.00 today, the wind forecast is due to trough at 16.00-17.00 tonight. Day-ahead prices cleared at £280/MWh, enough to get the OCGTs interested. bmrs.elexon.co.uk/events

bmrs.elexon.co.uk

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Tom Edwards @notionalgrid.bsky.social · 03/09/2026

Just heard someone referring to colocated batteries and standalone batteries as Green BESS and Grey BESS, and am hearby proposing that we refer to Behind the Meter batteries as Salmon BESS. Would also accept Fuchsia BESS.

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Tom Edwards @notionalgrid.bsky.social · 19/08/2026

If we are remain committed to gas surely the gas system costs need to be explored? To keep a stable gas price we must invest in new production, maintaining Gas T&D, more storage. So savings in power network expansion & power storage are offset by the cost of maintaining & expanding the gas network?

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Tom Edwards @notionalgrid.bsky.social · 19/08/2026

Madness, you can't just take away the UK ETS and expect things to remain stable, What happens to interconnector trading? What happens with CBAM? Wouldn't the existing CfDs just absorb the saving?

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Tom Edwards @notionalgrid.bsky.social · 19/08/2026

They have 45GW of gas and 20GW of nuclear in 2050, hard to see how it could be cheaper given how much turbines cost nowadays. Most of their wholesale price saving just comes from removing UK ETS from generators, so not really realistic at all.

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Tom Edwards @notionalgrid.bsky.social · 24/06/2026

If its from NESO its an estimate which does include solar generation behind the meter

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Tom Edwards @notionalgrid.bsky.social · 24/06/2026

Its probably more, given installed solar capacity is best described as an estimate

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Tom Edwards @notionalgrid.bsky.social · 24/06/2026

Basically looks like its not windy enough, also Heysham is out on a planned outage and a couple of gas stations have been issuing REMIT notices for today

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Tom Edwards @notionalgrid.bsky.social · 24/06/2026

Weird news for the day, the NESO control centre has issued a margin notification for the evening, I dont recall a June EMN before(!)

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Tom Edwards @notionalgrid.bsky.social · 23/06/2026

Update to the cap and floor legal challenge, Zenobe's application has been dismissed, the Tribunal found that the scheme does not constitute a subsidy decision (and also that it does not have authority to review the scheme). www.catribunal.org.uk/sites/cat/fi...

catribunal.org.uk

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Tom Edwards @notionalgrid.bsky.social · 27/05/2026

All the cool kids are "Principal" nowadays

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Tom Edwards @notionalgrid.bsky.social · 21/05/2026

The point of NIV chasing being....YOU DON'T HAVE FPNS

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Tom Edwards @notionalgrid.bsky.social · 21/05/2026

Good to know that DESNZ don't know how NIV chasing works

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Tom Edwards @notionalgrid.bsky.social · 11/05/2026

Remaining with Kaluza, at least for a while?

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Tom Edwards @notionalgrid.bsky.social · 07/05/2026

If we assume it has 10 years left (built in 2010) of CM payments left I think it would need £60/kW each year at an 85% de-rating factor to make back that £370mn. Which seems like a reasonably achievable outcome, with other revenues paying for Gas and Network charges. a

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Tom Edwards @notionalgrid.bsky.social · 07/05/2026

£370mn for 850MW is about £435/kW, which you could buy a new recip gas engine or most of a new OCGT for.

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Reposted by Tom Edwards

Joseph Cotterill @jsphctrl.ft.com · 28/04/2026

In the last few weeks, the UAE has a) sounded out the US on a swap line b) pulled billions of dollars out of Pakistan, an ally c) left Opec, where it was one of the biggest members by quota.

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Tom Edwards @notionalgrid.bsky.social · 21/04/2026

It will vary on the hh depending on how much market power they have, we still see there being sufficient hours to keep some intra gas competition going

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Tom Edwards @notionalgrid.bsky.social · 21/04/2026

Capacity prices need to stay high as well

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Tom Edwards @notionalgrid.bsky.social · 21/04/2026

(noting our central scenario only gets to ~89% Clea Power target)

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Tom Edwards @notionalgrid.bsky.social · 21/04/2026

In our modelling some gas is still running because its in Merit, so maybe they are assuming there is still the most efficient gas station needed?

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Tom Edwards @notionalgrid.bsky.social · 21/04/2026

Also, where is the breaking of the link between gas and power? By the government own ambition gas will still be running in 50% of hours (generous reading 30% of the time?)

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Tom Edwards @notionalgrid.bsky.social · 21/04/2026

Any ROC generator probably only has 15 years of useful life left, so the agreement length is probably around 10 years at least? We put the long-term PPA market for a index linked discount around 85% for a wind farm, so if thats where the market is offering the Govt has to be higher.

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Tom Edwards @notionalgrid.bsky.social · 21/04/2026

Seems odd, as there would be little saving to the customer here, unless the generator accepted a WCfD with a large haircut. A generator would likely be under a PPA with a discount to the day-ahead price, say 90%. So what discount would a generator be willing to accept for a longer agreement?

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Tom Edwards @notionalgrid.bsky.social · 21/04/2026

New GB wholesale mechanism being consulted on - the Wholesale CfD - RO genertors get to keep their ROCs, but exchange their current PPAs for a government backed one at a fixed price

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Tom Edwards @notionalgrid.bsky.social · 20/04/2026

Also NESO has to step up a gas purchasing operation, what do you do with all the gas already bought by traders?

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Tom Edwards @notionalgrid.bsky.social · 20/04/2026

CCGT RAB: Make gas plant no-longer self dispatch, owners make gas plant available for NESO to dispatch at receive fixed payments. Doesn't necessarily remove gas price influence as other generators are well aware of what the gas cost is and when gas is running.

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Tom Edwards @notionalgrid.bsky.social · 20/04/2026

ES market cap: Amounts to setting a gas price cap and compensating the gas plant the difference. Likely to be very expensive and time limited. Also likely to make GB a net power exporter & if not coordinated with EU Markets, could result in higher gas prices as we then need to import LOTS of gas.

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Tom Edwards @notionalgrid.bsky.social · 20/04/2026

Converting RoC to CfDs: Caps upsides for renewables generators, counterintuitively also makes negative prices less likely, so may even increase wholesale prices. depends on the level of the CfD. What happens if generator refuses.

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Tom Edwards @notionalgrid.bsky.social · 20/04/2026

What practical short-term options might exist for capping or de-linking gas from power prices? Three spring to mind from recent REMA discussions, converting RoCs to CfDs, iberian gas price caps and moving CCGT to a RAB model.

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Tom Edwards @notionalgrid.bsky.social · 17/04/2026

CBAM is complicated because its based on historic emissions intensity, so it might not completely harmonize the price. The effect of the CPS will decrease over time as we get more renewables, but we wont ever eliminate gas burn from the system.

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Tom Edwards @notionalgrid.bsky.social · 17/04/2026

Not to mention the gas price will come down by 2028 when this is implemented, so the impact would be much lower than if it were implemented immediately.

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Tom Edwards @notionalgrid.bsky.social · 17/04/2026

In markets dominated by Gas, or when nuclear output and renewables are lower, and demand higher we would expect to now increase our exports, and potentially increase our gas burn, reducing the overall impact of the measure.

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Tom Edwards @notionalgrid.bsky.social · 17/04/2026

EU ETS prices for 2026 are at €74.3/t (£65/t), UK ETS prices for 2026 are £46.93/t. Therefore a CCGT in the EU is spending £26.75/MWh on carbon, a GB CCGT is spending £34.11/MWh on carbon. Removing the CPS makes the GB CCGT carbon cost £19.2/MWh, £7.4/MWh cheaper than EU

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Tom Edwards @notionalgrid.bsky.social · 17/04/2026

Reducing GB wholesale power prices could result in higher exports/lower imports across the interconnectors. This would feedback into higher gas burn, using less efficient power stations & increasing the price of gas, which will lower the total reduction in the difference in price

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Tom Edwards @notionalgrid.bsky.social · 17/04/2026

However, the CPS also acts as an additional tax on carbon in the GB market, this makes GB carbon prices closer to the European carbon price, affecting the margin between continental power and GB power, and helping to induce import flows into GB.

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Tom Edwards @notionalgrid.bsky.social · 17/04/2026

CPS is a tax on fuel at the gate, the £18/t duty is equivalent of £7-8/MWh based on the efficiency of the power station. As gas plant are normally the marginal fuel we would expect this to be reflected into a reduction in nearly all traded wholesale power products.

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Tom Edwards @notionalgrid.bsky.social · 27/03/2026

So to get to that magic 35MCM/day number we'd need 24GW of onshore wind at decent load factors (over 100GW at low ones) at £42bn (or £177bn). Or 54 new gas fields, each costing ~£4.1 bn, so £221bn

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Tom Edwards @notionalgrid.bsky.social · 27/03/2026

Perhaps the onshore wind farm doesnt last as long? perhaps the gas field output degrades quicker? We could add around £600/kW onto the wind farm cost to account for additional battery storage backup?

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Tom Edwards @notionalgrid.bsky.social · 27/03/2026

Equinor estimated rosebank would require £4.1bn in investment, so thats ~£12bn to get the same level of gas displacement (with an addiitonal £3.6bn of ongoing opex)

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Tom Edwards @notionalgrid.bsky.social · 27/03/2026

A new offshore field can expect to produce around 0.3-1mcm/day, with a mid point of 0.65mcm/day, so we would need around 3.1 new fields to get the same effect as relacing the CCGT t.co/QgL6H3IXRB

t.co

https://undervaluedequity.com/oil-and-gas-flow-rates-how-to-determine-if-a-wells-daily-production-range-is-fair/

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Tom Edwards @notionalgrid.bsky.social · 27/03/2026

Lets be less chartitable and assume the de-rated capacity of onshore used in the CM at 6.6%, that would need 6GW of onshore wind aat £10.3bn

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Tom Edwards @notionalgrid.bsky.social · 27/03/2026

Lets say an Enlgish onshore wind farm has a load factor of 28%, crudely we'd need 1.4GW of onshore wind to replace that. Thats a cost of £1.7/kW so around £2.4bn.

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Tom Edwards @notionalgrid.bsky.social · 27/03/2026

an 800MW CCGT with a load factor of 50% over 24 hours makes 9.6GWh, thats 2.0472MCM/day at 48% efficiency

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