Wait for a bus then two show up at once….
This week we saw National Grid issue two Electricity Margin Notifications, having not issued one since 2016. Let’s remind ourselves also that only back in September National Grid also issued Electricity Capacity Market Notice. But what do all these notifications mean?
Both notifications serve largely the same purpose and that is to tell the market that the Electricity Control Centre do not expect generation to meet demand (after accounting for margin National Grid are required to hold). The key difference being Electricity Margin Notifications are typically issued further in advance.
Why were they issued this week?
This week we had the first cold snap which increased power demand, coupled with incredibly low wind over the evening peak period. See below the temperature and wind generation for the last 7 days.
What was the impact on the market?
Both notifications were ultimately cancelled by National Grid, but that didn’t stop prices jumping. National Grid appear to be using these notifications more liberally as a signal to the market so we expect to see more this winter. Our 24/7 trading team are consistently monitoring the market for opportunities such as the above where we can capitalise on them on behalf of our customers, whilst ensuring security of supply for National Grid.