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#ABOUT US GENERATOR GENERATOR#

This change was made to bring Foyers in line with what it believed was the market practice of other pumped storage operators, and to increase profit.

In May 2020 SSE took the decision to make the bid prices it charged NGESO to reduce Foyers’ output significantly more expensive – including in periods of transmission constraint.

In October 2021, Ofgem opened an investigation into SSE’s compliance with the TCLC in relation to Foyers pumped storage power station, which is located in Northern Scotland and regularly operates in transmission constraint periods.

The Transmission Constraint Licence Condition (or TCLC) prohibits them from doing so. This creates a risk that generators could exploit their position by charging the NGESO excessive prices to reduce their output. Typically, when managing a transmission constraint, NGESO will only have a limited number of alternatives available to it. Situations which could cause transmission constraints might, for example, include where there is insufficient network capacity to transport power out of a particular area in which local generation exceeds demand. Where constraints on the transmission system exist, then NGESO will take action to manage flows across the network, including using the balancing market to increase and decrease the amount of electricity produced by different generators. In order to meet our electricity needs, power must get from where it is produced to where it is consumed. The penalty relates to our finding that SSE secured excessive payments from National Grid Electricity System Operator (NGESO) during periods of what is known as ‘transmission constraint.’

#ABOUT US GENERATOR GENERATOR#

As a consequence, Ofgem proposes to require the company to pay £9.78 million into the Energy Redress Fundįollowing a detailed investigation, Ofgem has today issued a notice of its proposal to require electricity generator SSE Generation Limited (SSE) to pay £9.78 million in relation to a breach of its Generation Licence.Ofgem has found that SSE Generation Limited breached its licence after securing excessive payments from National Grid ESO in exchange for reducing output at Foyers pumped storage power station.