National Grid To Pay Firms To Use Less Power

National Grid recently announced that it has signed deals with Tata Steel, Flexitricity and 429 other companies, agreeing to pay them to use less power at peak times.

The company, which runs Britain's supply network said the agreement would give it the "tools it needs to balance the power of the grid"

Peak time is defined as between 16:00 and 20:00 on weekdays from November through to February.

Fears have been raised of power shortages due to unexpected plant shut-downs, as a result of these new agreements.

National Grid has so far contracted 319 mega watts of what it has dubbed "Demand Side Balancing Reserve" at 431 sites in the United Kingdom. As and when needed, plants will reduce their demand on the grid, or switch to their own generators. In return, they will receive compensation from the National Grid.

Last month, National Grid said it would be expediting emergency plan asking providers how much additional electricity they could supply in the event of a shortfall, following a recent string of unforeseen problems at various power plants.

A few months ago, National Grid stated that the emergency plan would not be needed this year. That prediction has since changed, following fires at E.On's Ironbridge and SEE's Ferrybridge power plants, and provisionary checks at EDF's Heysham and Hartlepool nuclear plants, following a serious of problems.

The UK is facing a real reduction in the domestically produced power, due to an ageing population of power plants that are slowly shutting down, and the speed, or lack thereof, of new ones starting up.