Hello! Welcome back to our module on System Inefficiencies.
In our last lesson, we introduced the concept of network congestion—the "traffic jams" on the electricity grid that occur when there isn't enough transmission capacity to move power from where it's generated to where it's needed. We saw how this leads to constraint payments, where the grid operator pays some generators to switch off and others to switch on to keep the system in balance.
Today, we're going to build directly on that knowledge. We'll focus on the term for deliberately reducing a generator's output: curtailment. Our goal is to explain the technical and market-based reasons for renewable generation curtailment, with network congestion being a key part of the story. By the end of this lesson, you'll understand the different situations that force the grid operator to "waste" clean, available energy.
1. What is Curtailment?
At its simplest, curtailment is the act of deliberately reducing the output of a power generator from what it could otherwise produce with the available resources (like wind or sun).
In the last lesson, we saw how the National Grid ESO pays a wind farm in Scotland to reduce its output to solve a congestion problem. This action is a form of curtailment. However, congestion isn't the only reason it happens.
This image provides a great overview by splitting the reasons for curtailment into two main categories: technical and economic.
We will now explore both of these categories in detail.
2. Technical Reasons for Curtailment
Technical curtailment happens when the physical laws of electricity and the limits of the grid infrastructure make it impossible to deliver the power safely.
The Main Technical Reason: Network Congestion
As we learned in the previous lesson, the single biggest technical reason for curtailment in the UK is network congestion. To refresh and solidify this concept, please watch the following video.
Wind Power: Why some wind farms are being paid to stop producing energy
This Sky News clip, 'Wind Power: Why some wind farms are being paid to stop producing energy', clearly illustrates how the geographical location of wind farms leads to congestion-driven curtailment.
Please watch from 00:25 to 01:15. Pay close attention to the explanation of where wind power is generated versus where it is used, and the bottleneck this creates.
The video explains the core problem: a geographical mismatch. The following maps illustrate this perfectly.
While we've established that the grid acts as a bottleneck, the reality is even more complex. The problem isn't just that we haven't built enough new transmission lines; it's also that the existing lines are often unavailable.
Let's dig deeper into the specific technical constraints on the UK grid.
This article from the UK Energy Research Centre, titled 'The Quiet Driving Force Behind Rising Curtailment Costs', provides an expert analysis of the transmission network's limitations.
This is a detailed article, so focus on these specific parts: Read the section 'What is wind curtailment?' to understand the role of the System Operator and the concept of 'thermal constraints'. Jump to the section 'What is driving all this curtailment?'. Read this to learn about the key bottlenecks, known as the 'B6' and 'B4' boundaries. Finally, read the section 'Operational Unavailability'. This explains a crucial, often-missed point about why even the existing grid capacity isn't always fully available.
Let's summarise the key technical points from that article:
- Thermal Constraints: Transmission lines have a maximum power limit. Pushing too much current through them causes them to overheat and sag, which is dangerous. Curtailment is necessary to respect these thermal limits.
- Specific Bottlenecks (B4 & B6): The major congestion points are on the Scotland-England border (the B6 boundary) and within Scotland itself (the B4 boundary). There simply isn't enough capacity to get all the power generated in the windy north out to the rest of the country.
- Delayed Upgrades: New high-capacity subsea cables that would relieve these bottlenecks have been significantly delayed. A project that should have been ready in 2023 is now not expected until 2029.
- Operational Unavailability: This is a crucial point. To upgrade the grid or connect new projects, existing lines must be taken out of service for maintenance. This means that for much of the time, the actual available capacity of the grid is much lower than its theoretical maximum. It's like closing lanes on a motorway for roadworks, making the traffic jams even worse.
In short, the primary technical reason for curtailment is a transmission system that is too small, has been upgraded too slowly, and is often operating at reduced capacity due to ongoing works.
3. Market-Based Reasons for Curtailment
Market-based, or economic, curtailment happens not because of a specific bottleneck, but because of system-wide market conditions.
System-Wide Oversupply
The main market reason for curtailment is simple: there is more electricity being generated across the entire country than there is demand to use it.
This can happen during a "perfect storm" of conditions:
- Very windy and/or sunny weather, leading to high renewable generation.
- Low national demand, for example on a weekend or a bank holiday.
When this happens, the grid frequency starts to rise (a topic we'll cover in detail in Module 6), and the System Operator must act to reduce the total amount of generation to match demand.
This video explains this scenario well.
Curtailment - what is the problem and how can we fix it?
This video, titled 'Curtailment - what is the problem and how can we fix it?', explains the 'perfect storm' for curtailment where high generation meets low demand.
Please watch from 01:10 to 03:43. The presenter describes the conditions on a specific day that led to high levels of curtailment, illustrating the concept of system-wide oversupply.
Economic Dispatch in the Balancing Mechanism
When the ESO needs to curtail generation—either for technical (congestion) or market (oversupply) reasons—how does it decide who to turn off? The answer lies in the Balancing Mechanism, which we introduced in the last lesson.
Generators submit bid prices—the price at which they are willing to be paid to reduce their output. To keep costs for consumers as low as possible, the ESO will always accept the cheapest bids first.
This creates a market-based reason for why certain generators are curtailed more than others. The UKERC article you read earlier highlights a fascinating, and perhaps counter-intuitive, outcome of this process:
"...in the competitive world of the BM, the cheapest – and therefore first – wind farms to be instructed by NESO to turn down output to manage thermal constraints tend to be the biggest, newest and shiniest additions to the fleet." (Source: Transmission Network Unavailability...)
This happens because these large, efficient, modern wind farms often have very low operating costs and are supported by government contracts, allowing them to place very low (or even zero) bids to be turned down. From a purely economic standpoint for the ESO, they are the cheapest option to curtail.
Test your understanding!
It's a windy Sunday, and the ESO needs to reduce wind generation.
- Wind Farm A (a new, large offshore farm) submits a bid price of £2/MWh.
- Wind Farm B (an older, smaller onshore farm) submits a bid price of £40/MWh.
Which wind farm is the ESO more likely to curtail and why? Is this a technical or market-based decision?
Show answer
The ESO is more likely to curtail Wind Farm A. Even though the reason for the curtailment might be technical (e.g., a bottleneck), the decision of who to curtail is market-based. The ESO chooses the cheapest option available in the Balancing Mechanism to minimise costs, which in this case is Wind Farm A's £2/MWh bid.
Summary
We've seen that while the image of a wind turbine being turned off on a windy day seems strange, there are clear technical and economic reasons behind it.
Here is a summary of the key drivers:
| Reason Type | Specific Cause | Description |
|---|---|---|
| Technical | Network Congestion | Not enough grid capacity (a "bottleneck") to move power from generation centres (e.g., Scotland) to demand centres (e.g., London). |
| Technical | Network Unavailability | Existing grid lines are often out of service for maintenance and upgrades, further reducing the available capacity. |
| Technical | Local System Stability | Sometimes generation must be reduced to keep voltage or frequency stable in a specific area (though congestion is the dominant issue). |
| Market | System-Wide Oversupply | More electricity is generated nationwide than is being used, requiring a reduction in total supply to keep the system balanced. |
| Market | Economic Dispatch | The ESO uses the Balancing Mechanism to select the cheapest generators to turn off, which often means curtailing the newest and most efficient wind farms. |
Conclusion
In this lesson, you have learned the distinct reasons why valuable renewable generation is sometimes curtailed.
Key Takeaways:
- Curtailment is the deliberate reduction of a power station's output.
- Technical reasons are driven by the physical limits of the grid. The main one in the UK is network congestion, caused by a geographical mismatch between generation and demand, and made worse by delayed upgrades and operational unavailability of existing lines.
- Market-based reasons are driven by economics. This can be due to system-wide oversupply (too much power everywhere) or the logic of economic dispatch, where the ESO curtails the generators that offer the cheapest price to do so.
Preview of the next lesson:
Curtailing gigawatts of clean energy and paying for the privilege clearly has financial consequences. In our next lesson, we will analyze the economic inefficiencies resulting from renewable curtailment, looking at the cost of the constraint payments themselves and the lost revenue for renewable projects.