Can neighbors in the UK help it keep the lights?

The weather still settled throughout the UK on January 8 due to the cold, and with the permanent shutdown of coal-fired power plants, the team responsible for keeping the country's lights turned to other power supplies hundreds of miles away.

National Grid's energy system operators cost up to £179 per megawatt-hour, more than double the typical electricity bill purchased the previous day to import electricity from Denmark via Viking Link, a 475-mile submarine cable that extends between Jutland and Lincolnshire.

In turn, Denmark had to withdraw its electricity from Germany. "It's been an urgent day," said Fintan Devenney, senior energy analyst at consulting firm Montel.

The trade highlights the UK’s increasing reliance on importing and exporting electricity from its neighbours – which will increase as the country attempts to make wind turbines and solar panels the backbone of its power system, as part of its decarbonized power supply by 2030.

Larger interconnects should make the system more resilient. However, this also exposed the electricity of international political tensions. Some of these have come: Trade protectionism complaints about barriers to EU exports after exports to electricity and to the UK continue to rise.

Prime Minister Sir Keir Starmer is expected to push for closer ties to the EU's energy and carbon markets as part of the highly anticipated EU "reset" summit in London on Monday.

Powering the UK

This is the last part of the series about the future of the UK Grid

"At present (but) are all hindered by stupid things like phishing negotiations," said a government figure. "It has full support from the industry in the UK."

Since the first online access in 1961, the UK's cables to its neighbors have spread.

In 2023, the latest year when data is available, the UK imported 23.8 Terawatt of electricity, accounting for about 7.5% of domestic demand.

More “interconnected” cables from the UK are also planned within the growth range of wind and solar energy in the UK and throughout the African continent.

In addition to regional pricing and demand-side flexibility, they are a means to address the intermittent nature of renewable energy by actually increasing market size and flexibility.

When the UK is in high winds, power can be imported, and its cost may be lower than turning on domestic supply and exports on huge or sunny days that the country has.

The UK government hopes to have a current 31.4 GW of wind and almost triple solar capacity by 2030, which is expected to have an interconnection capacity of about 4GW at that point.

If these goals are achieved, NESO estimates that the UK will become a net exporter of electricity within five years.

“With electricity, we’re not an island,” said Ben Wilson, president of the State Grid Corporation of the State Grid Division, which has Vikings and other cables and is developing other cables. “We have a good connection.”

Larger interconnections between countries are also a key goal of the EU. However, rising electricity prices and energy security issues have begun to test the limits of that ambition.

In January 2023, Norway developed measures to allow for reduced energy exports if there is a risk of domestic shortages and shortly after denying permission for new interconnections to Scotland.

The coalition government in Oslo went bankrupt in January as central partners opposed EU energy policy.

But Norway's ruling Labor Party is also skeptical: It has asked state-owned power system operator Statnett to postpone plans for any new interconnectors until 2029. It also hopes to turn off the three cables to Denmark when two of the three cables are restored in 2026.

Energy prices and interconnectors will be highlighted in Norwegian parliamentary elections in September.

"I think Norway has now realized that they have a very valuable resource that they actually give them very cheaply and that they want to create some scarcity isn't unreasonable," said Adam Bell, a policy director at the consulting firm Stonehaven, a former head of energy strategy at the UK government.

Since the first cable opened in October 2021, the UK has imported £2.9 billion worth of electricity from Norway, highlighting its dependence on the Scandinavian nation because of its own electricity supply.

Pranav Menon of Aurora Energy Research said that the UK could benefit only by reducing competition for exports, with Norway cutting only Denmark’s capabilities. But political rhetoric in Norway may not be the case, he warned.

"The loss of interconnection with Norway could significantly increase price volatility in the short term," Menon added.

Exports are also under scrutiny in France, the largest source of imports in the UK. In a legislative election last year when far-right parties won nearly a third of the votes, the Navy Marine Le Pen’s summary state made recommendations for greater control over exports.

France and Norway are particularly important to Europe's power systems, as their respective nuclear and hydropower supplies help prevent the risk of simultaneously low or high wind energy throughout the northern continent.

Experts differ in the severity of this risk, although the latest research by consulting firm Wood Mackenzie points to the “air drying” in Northern Europe in March 2021 and points to a “strong correlation” between onshore and offshore fleets in 2020.

IEA analysis shows that over the past 30 years, about five to six cold, low wind curses have affected most parts of Europe for a week or more, including the areas where most onshore and offshore projects are located.

Industry analysts and lobbyists warn that Brexit has introduced new trading barriers, and protectionist moves are due to new trading barriers that are raising costs and threatening new investments.

The UK's exit from the EU single energy market means that the interconnection capacity between the two is no longer automatically allocated, but needs to be explicitly purchased by traders in separate auctions, resulting in less efficient markets.

In addition, the industry warns that UK electricity exports to the EU will be taxed from 2026 due to differences in the EU's carbon border tax and UK-EU emissions trading plans.

Simon Virley, energy director at consulting firm KPMG UK, said there were many dangers when Starmer prepares to meet with London's European Commission president Ursula von der Leyen.

Ministers want to improve the “market linkage” between the UK and the EU, rather than the interconnection quota, while also connecting emissions trading plans.

“Coordinating energy trading rules and eliminating current frictions can help lower consumer bills and ensure greater energy security and resilience,” Virley said.

In theory, taking more rules from the EU may be politically controversial, although ministers believe the issue is too technical to be a problem at the door. The British government figure says: "I suspect anyone except (Nigel) Farage will notice or care about it."

A government spokesman said: "We are resettling our relations with the EU to improve trade and investment and promote climate, energy and economic security.

“We look forward to the European Commission next week and we hope to make real progress on these issues.”

National Grid's Wilson agreed that there is an "opportunity" to reconnect electricity and carbon trading, which will be "mutually beneficial".

Meanwhile, State Grid and others are working to implement new interconnection projects, including a "hybrid" project connecting the North Sea Wind Farm to both markets.

“Supply security lies in diversity,” he added.

Other reports by Richard Milne. Janina Conboye's data visualization