The 'Balancing Mechanism'-National Grid and Scottish Power Moving Wind Forward in Britain

“Firms paid to shut down wind farms when the wind is blowing,” is the unfortunately misleading headline of a recent article in the UK Telegraph touting how Britain’s biggest wind farm companies are being paid not to produce electricity when the wind blows. The article describes a current effort to fiscally compensate energy firms to turn off their turbine when supply exceeds demand. The author cites the ‘intermittent’ nature of wind as the justification for why onshore wind farms are “unreliable providers of electricity.”  Since the excess electricity cannot be stored, National Grid and Scottish Power have worked together to test a solution coined as the ‘balancing mechanism’-switching or reducing the power supplied when supply exceeds demand.

The first successful test shut down of wind farms took place three weeks ago. Scottish Power received £13,000 for closing down two farms for a little over an hour on 30 May at about five in the morning. Whereas coal and gas power stations often pay the National Grid £15 to £20 per megawatt hour they do not supply, Scottish Power was paid £180 per megawatt hour during the test to switch off its turbines.

This arrangement was tested where National Grid could direct a wind farm, here Scottish Power, to turn off turbines in the event of excess generation with the expectation that the wind farm would be compensated by National Grid if this occurred.  Creating less when we need less is a good thing-no?  In other parts of the world, fossil fuel plants are routinely turned down when, for example, there is an abundance of hydropower available at lower operating costs.  Moreover, a tariff was designed to compensate the wind farm if this were to occur. 

Fossil fuels and nuclear energy have been subsidized heavily for decades.   This pilot was designed to test the viability of a new energy source and address the intermittency concerns.  Since the article accurately captured the fact that the balancing mechanism was deployed, the arrangement appears to have been successful.  The test gives National Grid the confidence that they can readily balance the grid to accommodate changes in demand and supply, which makes wind an easier source of energy to integrate into their grid.  

For the critics of wind farms who have “seized on the revelation as evidence of the unsuitability of turbines to meet the UK’s energy needs in the future,” there are options. Greater ingenuity, specifically, flexible scheduling of industrial operations and other end uses like irrigation, could utilize this excess generation.  The Pacific Northwest is also looking at water heat storage as an alternative since they have abundant water heat; in effect, a large quantity of wind generation could be stored in water heater tanks.

The mischaracterizations in this article are damaging to global energy policy.  Particularly in the United States when we are on the cusp of moving toward deployment of smarter approaches to our domestic energy policy. In the midst of our nation’s largest environmental catastrophe, as a result of the Deepwater Horizon oil spill, learning from successful initiatives like this is a critical step in evolving our energy independence.