Our early expectations for the coming winter

Early View of Winter 2024/25  

To support the energy industry’s preparations for the 2024/2025 winter we’ve published its Early View of Winter Outlook report, to give organisations across Great Britain’s energy industry time to prepare for the coming winter. As with previous years, a more in-depth Winter Outlook report will be published later in the year to provide more up to date information relating to the coming winter. 

The Early View uses a Base Case scenario to assess the ability of de-rated capacity to meet peak average cold spell demand. This year’s Early View finds that the de-rated margin in this Base Case scenario is 5.6 GW (9.4%). This is higher than the 4.4GW (7.4%) published in the Winter Outlook for 2023/24 and within the Reliability Standard. 

The Early View of Winter also includes an operational margin which outlines the expected availability of excess generation above the electricity needed to meet demand and the reserves we hold at all times. 

We expect to have sufficient operational surplus throughout winter in our Base Case, even when we consider the expected natural variation of demand, wind and outages. As with previous winters, there may be some tight days where we need to use our standard operational tools, including the use of system notices. 

The year-on-year change is due to increased interconnector capacity, new gas generation, growth in battery storage capacity and the effects of increased generation connected to the distribution networks. 

Rebalancing in European energy markets has further reduced the risk of fuel shortages for gas generation in Great Britain and increased the resilience of interconnector imports to supply-side shocks. 

While energy markets show signs of stability, uncertainties remain. As a prudent system operator, we remain vigilant, continuing to monitor potential risks and working closely with Government, Ofgem and National Gas Transmission to establish any actions necessary to build resilience.  

We will continue to meet the challenge of reliably operating a changing electricity system as new technologies, and diverse forms of capacity, contribute to security of supply. 

Our Demand Flexibility Service (DFS), first introduced in the 2023/23 winter as an enhanced action to mitigate against risks and uncertainties over recent years, has demonstrated that demand flexibility can be provided at a national scale. We are engaging with industry stakeholders to consider how the service could evolve and will be publishing more information in the near future. 

Early view

Winter Review 

As part of our annual process of reviewing the 2023/24 Winter Outlook, we can confirm that winter margins were broadly within the expected range of the 2023/24 Winter Outlook Report and there was no interruption to customer demand due to unavailable supply.  

Winter 2023/24 was milder than average with two notable cold spells in November / December and January. There were no Electricity Margin Notices (EMNs) or Capacity Market Notices (CMNs) issued during winter 2023/24. 

There were a small number of days over winter where the outturn surplus fell below the range presented in the Winter Outlook Report. In late winter unplanned nuclear outages led to reduced generation and therefore a prolonged period when the operational surplus was below the Winter Outlook Report's forecast. 

Balancing costs over winter 2023/24 have fallen by over 40% year-on-year, principally driven by lower wholesale costs and activities we took to minimise cost to consumers. 

Winter Review 

Commenting, the ESO's chief operating officer Kayte O'Neill said: 

"Our initial assessment of the winter ahead indicates that we will have sufficient margins throughout the period. Factors such as increased interconnector capacity, new gas generation, growth in battery storage capacity and increased generation connected to the distribution networks are contributing to higher margins than last winter. 

"Global energy markets are showing signs of stability, but uncertainties remain and therefore as a prudent system operator we remain vigilant, continuing to monitor potential risks and working closely with our partners to establish any actions necessary to build resilience. 

"We are continuing to meet the challenge of reliably operating a changing electricity system as new technologies, and diverse forms of capacity, contribute to security of supply."