Keeping the lights on

Is high price of UK's energy 'fire brigade' worth paying?

- Jillian Ambrose Energy correspondent

Travel 18 miles north of London and the grey bulk of a gas power plant comes into view near Rye House railway station in Hertfordshire. Rye House power station has generated electricity since 1993, making it Britain's longest-serving such power plant still in the market. But it also produces some of the UK's most expensive electricity.

The power plant, which is owned by a subsidiary of the commodities trading giant Vitol, has in recent years called for record high payments to generate power when electricity was in short supply.

In the winter of 2022, after Russia's invasion of Ukraine triggered record gas prices, Rye House was charging £6,000 for every megawatt-hour it generated. UK electricity market prices are typically between £60 and £100 per megawatt-hour.

In January, Rye House was one of two power plants that were each paid more than £6m to run their gas turbines for a few hours during a spell of freezing weather.

The payments provoked outrage from climate campaigners and consumer groups who have called on the government to hasten Britain's plan to reduce its reliance on gas power to just 5% of the electricity system by 2030.

Under the system to balance Britain's grid, the National Energy System Operator (Neso) encourages energy companies to bid prices at which they would be prepared to power up their plants.

But these gas plants are here for the foreseeable future and will still be needed at the end of the decade, according to official forecasts.