Ofgem consults on National Grid’s £113m cost recovery bid

Ofgem has said it is consulting on a request by National Grid to recover costs of contracts worth £113 million. They are two contracts for grid services agreed with two […]

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By Jacqueline Echevarria

Ofgem has said it is consulting on a request by National Grid to recover costs of contracts worth £113 million.

They are two contracts for grid services agreed with two suppliers, SSE for its Fiddlers Ferry coal plant and with Drax group following a tender process.

These services refer to the ability of certain generators to start up and provide electricity to the transmission system without an external power supply, also called “Black Start” system.

Coal plants have provided the country with this capability but the economics of running these plants have changed which means they are available less frequently than before, Ofgem stated.

The regulator set National Grid a cost target for these services but the distributor spent more money than the agreed goal so it asked Ofgem to recover all of these costs through the “Income Adjusting Events” process.

Ofgem has the power to rule on full or partial recovery of the costs.