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Europe’s power crisis overtaking gas crisis

August 22, 2022

By Paul Homewood

This latest analysis from Timera dovetails with my piece on the broken electricity market yesterday:



Europe’s power crisis overtaking gas crisis

Europe is now facing a parallel gas & power crisis. The influence of the rising cost of gas driving up power prices is well understood.  What is receiving less attention is a rapidly accelerating power crisis which is driving a renewed surge in gas prices.

The geopolitics of Russian supply dynamics is currently dominating global headlines. The current conflict has exposed the extent of Europe’s dependence on cheap hydrocarbons from a hostile neighbour. Russia cutting supply to Europe has been the primary driver of the surge in gas prices across Europe in H1 2022.

Europe’s parallel power crisis has gathered pace across the summer. This is being driven by nuclear availability issues, depleted hydro levels & declining thermal output (both due to fuel access issues & plant closures). Power prices across Europe are surging to record levels, now materially outstripping the rise in gas prices.

The price of TTF gas for 2023 delivery closed last week above 237 €/MWh (70 $/mmbtu), up 120% since the beginning of July!  Power prices rises across the same period were much more aggressive. We’ve run out of adjectives to describe the pace of this price surge.

Acute power market tightness across Europe has been a key factor dragging up forward gas prices across the last 6 weeks. Europe needs more generation output to keep the lights on and the only remaining option is gas.

In today’s article we look at the circular pricing dynamics that are driving an upwards spiral of demand destruction in European gas & power prices.

Forward gas curve surge

We rarely publish the same chart in consecutive feature articles. However to emphasise the scale of the move up in gas prices across the summer, Chart 1 is an update of the chart we showed in July.

Chart 1: The surge in TTF forward prices since early July

There is a lot of media attention on the front of the TTF curve. Prices for Sep 22 delivery are up around 35% since we published this chart (green line vs dark blue line).

Of far greater consequence is the fact that the price for delivery of gas across Calendar 2023 has risen 120% since the start of July. A pause to let that sink in… the already extremely elevated price for delivery of gas next year has more than doubled in the last 6 weeks. And it is the same for Calendar 2024 (also more than doubled).

These are seismic shifts in the energy cost base of the European economy. They point to impending broad-based industrial demand destruction and a substantial increase in the probability of administered gas rationing.

Europe’s growing power crisis

The primary factor driving rising European power prices across the first half of 2022 has been the surge in gas prices. CCGTs dominate marginal power price setting across European power markets. As a result gas price rises flow directly into higher power prices.

A separate European power crisis has been gathering steam into the summer. The drivers of behind this are:

  1. Very low French nuclear availability (EDF recently scaled back its output guidance for 2023 to 300-330TWh and is now facing cooling issues that are impacting an already weak 2022 availability)
  2. Historically low hydro storage levels from Scandinavia to Iberia (given widespread drought conditions)
  3. Thermal plant closures across Western Europe (across ageing coal, nuclear & gas plants)
  4. Fuel supply logistics driven by a combination of very low Rhine water levels (e.g. impacting barge coal delivery to German power stations) & logistical issues driven by the Russian conflict
  5. Periods of low wind & solar output where the factors above are driving a deficit in residual generation.

The combination of these factors is pushing the power crisis onto centre stage.

Power crisis now driving the gas crisis

Europe is short molecules of gas across the next 3 years. Given lack of any material supply response across this period (in the absence of a return to higher Russian flows), there are three demand side reduction options to balance the market:

  1. Industrial demand (already facing destruction of ~15% so far in 2022 due to higher prices)
  2. Power sector demand
  3. Residential & commercial demand (the sector that governments are most likely to try and protect in case of rationing).

Normally very high gas prices would incentivise reduced demand from the power sector. But going forward Europe is now short electrons as well a molecules.  And the marginal source of incremental electrons comes from burning molecules.

In other words in order to keep the lights on, Europe has no alternative but to burn more gas, aside from intervention to reduce power demand which may also be coming.

A barometer for power vs gas crisis impact

The market pricing barometer that best reflects the severity of the power vs gas crisis is the Clean Spark Spread (CSS).  This is the spread between power prices and the variable generation cost of CCGT plants (i.e. CCGT generation margins).  Chart 2 shows how much French CSS has exploded since the start of 2022 (much of this in recent weeks).

Chart 2: French forward Baseload CSS in Jan 22 vs Aug 22

Source: Timera Energy, ICE

If CSS is rising it means that power price increases are outstripping the cost pass through of rising gas prices. This has been happening in spades this summer. It is most acute in the French market but forward CSS is also surging to record levels across most European markets. Chart 3 shows CSS in France versus two other key markets: UK & Germany.

Chart 2: Forward Baseload CSS in France vs UK vs Germany (18Aug22)

The UK & German forward CSS levels may look small relative to the French ones. Don’t be fooled… these are also at record levels. For example German Baseload CSS typically ranges from negative levels to low single digits vs more than 80 €/MWh currently for Winter 2023.

CSS transmission and the liquidity challenge

Forward CSS is a key transmission mechanism that is seeing rising power prices drag up the TTF gas curve. As forward CSS surges, it increases the incentive for gas generators to hedge forward generation. This involves forward selling of power and buying of gas (& carbon).

In other words entirely rational generation hedging is bidding up the cost of forward gas in response to higher power prices (& CSS).

Movements in both gas & power prices are currently being exacerbated by very poor market liquidity. This is a function of:

  1. Margin & collateral issues which are constraining the ability of market players to trade forward
  2. Risk capacity (e.g. VaR / limit) issues limiting forward exposures.

In a market with bids spiralling higher, there is very little offer liquidity to dampen price rises. These conditions are set to continue to support extreme price volatility. Market moves are not only in one direction. For example any increase in Russian supply would likely cause forward markets to gap lower.

One key piece of information the market is searching for is some clarity on the structure of policy intervention e.g. in the form of rationing or auctioning industrial volumes.  This information is a key input into trying to quantify the volumes & pricing of required demand destruction to clear markets.

A significant portion of current forward power & gas price levels is driven by risk premium reflecting this uncertainty. Markets are used to pricing electrons & molecules based on supply side flexibility, not demand side destruction & intervention.

Extreme prices create extreme incentives for all energy consumers to cut demand. Whatever form rationing takes, let’s hope it embraces market price signals rather than trying to dampen or cancel them.

There are a couple of take home messages:


1) Lack of power capacity is driving up demand for gas, and therefore gas prices, which of course drives up power prices in turn.

2) High gas prices look set to continue for at least the next three years.

  1. August 22, 2022 12:25 pm

    yes but two points;
    1) gas and oil prices had increased dramatically before the Ukraine war kicked off, due to low investment because of deliberate net zero policies
    2) NS2 can be used at any time the EU lift sanctions. This is deliberately self inflicted energy starvation.
    Underlying all this is net zero. There are those who want very high prices to create energy deprivation.

    • Robert Christopher permalink
      August 22, 2022 12:52 pm

      JW, yes, the higher prices are not the underlying problem: they are the results of the problem. It has been the discouraging signals aimed at the Energy sector, ever since before the 2008 Climate Change Act, to reduce investment, reduce maintenance, reduce R&D, reduce exploration, and reduce production.

      Correcting this is going to take time, not only finding the finances, but the skilled labour and materials.

      Finding some willing politicians (and voters) will be the first step … …

      • StephenP permalink
        August 22, 2022 3:25 pm

        Finding the willing politicians is going to be the main problem, as the existing bunch have too much reputation invested in Net Zero and too much pride to back down.
        The only politician in the UK to speak sense seems to Kemi Badenoch, but unfortunately she hasn’t got to the final two in the leadership election to be prime minister.

      • dennisambler permalink
        August 22, 2022 3:44 pm

        Not sure about Kemi Badenoch:

        “The Minister heard how the company will also be investing £566million in a Green Recovery programme to help create up to 2,500 new jobs in the region.

        These proposals include producing enough zero carbon water to supply a city the size of Leicester, creating bathing rivers close to one million homes and reducing the risk of flooding for 90,000 properties using nature-based solutions.

        Speaking after the visit, Treasury Net Zero Minister Kemi Badenoch said: I was delighted to visit Severn Trent and see the innovation to stop pollution and deliver Net Zero is already taking place.

        They are also leading the way out of the pandemic by delivering their Green Recovery programme which supports their ambitious net zero plan by 2030 and creates new jobs and world-class training via the government’s Kickstart scheme.”

        I know as the Minister she had to say those things but even so…

      • AdamGallon permalink
        August 22, 2022 5:08 pm

        All our politicians are wedded to Net Zero, it’s where the money is. At best, the targets for EVs & heat pumps will be pushed a little further down the road.
        Can’t say you’re not saving the planet, or you won’t get elected.

      • August 22, 2022 7:30 pm

        Yes, if you sold a product that the politicians repeatedly told you they intended to phase out soon, you would run down your supplies and not look for new sources.

        The Chinese and Russians must be looking at the West in sheer disbelief, not helped by our apparently being determined to ensure our armed forces reflect diversity rather than be a meritocracy.

      • Phoenix44 permalink
        August 23, 2022 9:14 am

        Yes, price is information.

        Politicians have never really understood that.

      • Realist permalink
        August 23, 2022 2:01 pm

        Finding voters who are not in favour of net zero etc. is not the problem. The problem IS getting European politicians to stop the hysterics, scaremongering and generally ignoring what markets (i.e. ordinary people and businesses) need and want.

    • John Culhane permalink
      August 22, 2022 6:16 pm

      There is another another level to geopolitical interest as postulated by Mike Whitney. Germanys under Merkel made a geopolitical miscalculation.

      The Crisis in Ukraine Is Not About Ukraine. It’s About Germany

      In a world where Germany and Russia are friends and trading partners, there is no need for US military bases, no need for expensive US-made weapons and missile systems, and no need for NATO. There’s also no need to transact energy deals in US Dollars or to stockpile US Treasuries to balance accounts. Transactions between business partners can be conducted in their own currencies which is bound to precipitate a sharp decline in the value of the dollar and a dramatic shift in economic power. This is why the Biden administration opposes Nord Stream. It’s not just a pipeline, it’s a window into the future; a future in which Europe and Asia are drawn closer together into a massive free trade zone that increases their mutual power and prosperity while leaving the US on the outside looking in.

  2. Ardy permalink
    August 22, 2022 12:30 pm

    Little mention of the lack of contribution from the billions spent on windmills and sun traps….

    • August 22, 2022 3:59 pm

      Yes, ramping up the output of existing greencr@p isn’t an option.

      • August 22, 2022 7:32 pm

        Unfortunately it is most clearly an option our elites intended to promote vigorously.

      • August 22, 2022 10:46 pm

        I meant the already installed capacity.

  3. Harry Passfield permalink
    August 22, 2022 12:38 pm

    It is quite clear- to me, at least – that the antics of the anti-fracking mobs was a deliberate strategy followed by those who seek to do this country harm. That being so, the government must enact similar war-time measures used in WWII against fifth columnists. Anyone caught interfering with power supplies or the extraction of fuel should be taken into the custody of the army – who should also be authorised to clear demonstrations and ‘green’ protests – and face serious charges in court.

    • Martin Brumby permalink
      August 22, 2022 1:01 pm

      Absolutely agree, Harry.

      Trunak and Suss need to get very serious indeed. Not a lot of indication that they will and Klaus Schwab wouldn’t like it, anyway.

      This is the inevitable consequences of ‘innovative’ energy ‘planning’ for Net Zero (with Zero science, zero cost/benefit, zero ‘Precautionary Principle’). All Vlad had to do (other than pay for pipeline and fracking protestors) was to burst their balloon.

      It is (and has been for years) clear that all this GangGreen nonsense isn’t a ‘bug’ in the Government’s ‘Plan’. It is the central ‘feature’.

    • Mike Jackson permalink
      August 22, 2022 1:55 pm

      Certainly I see a need for something along the lines of the Defence of the Realm Act.
      The first essential is for the government to repeal, or at the very least to suspend the provisions of, the Climate Change Act. Chickens are (very gradually) coming home to roost but we don’t have time to wait for eco-activists to come to their senses especially since most of them are not eco-activists but ‘water melons’. The problems we have are, as far as they are concerned, ‘a feature, not a bug’!
      The next stage is to enact severe penalties for “interfering with essential national infrastructure”, which will include all road, rail, air and water traffic, the winning of essential raw materials to include oil, coal, gas and any other materials the relevant minister might consider relevant, and the processing thereof to supply the countries energy requirements.
      I’m quite happy to see a “sunset clause” because nobody wants draconian laws to persist longer than is absolutely necessary. (Well, some people do but only draconian laws they approve of which wouldn’t include this one!) If we don’t take serious and in the short-term probably unpopular steps to ‘steady the ship’ who knows what the outcome might be a few years down the line.

      • Mike Jackson permalink
        August 22, 2022 1:57 pm

        country’s , not countries …… brain fade!!

      • August 22, 2022 3:50 pm

        Agree entirely; but sadly believe it will not happen.

        For the U.K. The first thing to be done is to start Fracking ASAP. Short of gas?—: Go get it. It is there beneath your feet.

        It won’t solve the immediate problem but would enable us to generate the income to pay off any borrowing needed to get us through the winter.
        If this “Defence of the Realm” act is well written then the production of gas would be very quick. At the sort of rate achieved, I recall, in the War. We didn’t mess about then; we just got on with the job.

        The objective is very simple: To stop the poor and vulnerable being killed through lack of energy.

      • Ben Vorlich permalink
        August 22, 2022 4:40 pm

        The problems in getting rid of Net Zero/CCC Act are
        1. A large portion of the UK population, perticularly the young, have been convinced that CO2 is a problem
        2. Politicians have convinced the public that greedy oil companies, fatcat executives and Putin’s Ukrainian adventure are the cause of high energy prices.

        Convincing enough people that they’ve been misled is going to be tricky

    • dennisambler permalink
      August 22, 2022 4:04 pm

      I think the government wants the anti-fracking mobs, they are long term committed to the chimera of Net Zero, because they are all signed up to the UN and its Sustainable Development goals, of which climate is but one. We must be seen to be “leading the world in fighting climate change” aka posturing on the world stage.

      Search – Truss Glasgow Cop 26 images – and then view all

    • August 22, 2022 7:33 pm


      You could argue the same with the economic sabotage caused by train and dock workers.

  4. It doesn't add up... permalink
    August 22, 2022 12:50 pm

    Every delay in pushing for increases in gas supply pushes up forward prices. Timera are looking at the assumption of drilling and permitting bans continuing. The day we get a reversal of that will be the day we see forward markets drop very sharply. Sentiment matters.

    Demand destruction isn’t going to square the price circle. By killing industry you kill your exports and import substitutes. Your balance of payments goes to massive deficit. Your currency slides, and you sell off assets at fire sale prices to pay for imports. That just drives the cost of gas higher in depreciated euros and pounds.

    Killing consumers by making energy unaffordable or unobtainable will eventually result in a potentially violent response. Politicians have already been procrastinating far too long over the need to get on with developing more gas production around the world.

    • Vernon E permalink
      August 22, 2022 3:15 pm

      As we argued last week, I believe that we should end the dependence of electricity generation on gas. We should adopt the Irish obligation that gas turbine operators must adapt to liquid fuels which can be stored for reliabilty and are cheaper. From the article I learn that European generators are just as dependent on CCGTs as we are. If only a few of the largest and best located generators changed fuel it would make big difference.

      • Carnot permalink
        August 22, 2022 5:41 pm

        Liquid fuels for CCGT is wishful thinking. It might be possible for a small number of sites BUT where would all the liquid fuels come. In the 70’s many power stations were oil fired, based on atmospheric residue ( Marchwood and Fawley) supplied by the local refinery. Then there we 16 refineries in the UK, and now there are six and many have been reduced in capacity ( Fawley 50%, Stanlow 30%, Lindsey 50%, Grangemouth 25%). There is not enough naphtha, kerosine or diesel available to make any meaningful difference.
        Fracing is wishful thinking. We do not have the manpower, knowledge or equipment. Then irrespective of the planning and permitting we do not have a gas gathering system. That would take years to build out and if you think it will be cheap then think again. You will need many expensive wells, which will need a lot of casing steel, sand and water. You will also need salt water disposal facilties for the produced water, which tends to be significant. It has not been profitable in the US and is unlikely to be profitable in the UK. I am not anti-fracking. Properely done it is safe, but it leaves a massive impact on the surface, which is fine in the desert in West Texas but would never be allowed in the UK. The well cost in the UK is likely to be substantially more than the US. Poland has large shale gas potential but the major all came, poked a few holes and went. There was no money to be made.

        I have been 44 years in the business and there is no magic bullet. Most of the best oil and gas reserves are in the hands of the NOC’s, which is why Exxon, Chevron and others are trawling around the Permian Basin, and not making much money.

      • Mike Jackson permalink
        August 22, 2022 7:08 pm

        I still don’t follow you opposition to fracking. If Cuadrilla and Ineos believe there is *possibly* enough gas under our feet to make the country self-sufficient in gas for the rest of this century then you would need a very convincing argument to persuade me you are right and they are wrong.
        Every cc of the stuff extracted eases the price pressure and regardless of whether we use it ourselves or add it to the pool it improves the country’s wealth and energy security.
        What’s not to like?

      • Micky R permalink
        August 23, 2022 8:05 am

        The Chinese claim to have constructed a 1GW coal-fired power station in thirty months, I assume that excludes the manufacturing period.

        This Chinese media website claims a proposed construction period of twenty seven months for a 1.3GW coal-fired power station . I assume parallel construction programmes for the five units, not sequential!

        Burning coal is a proven, robust, reliable and relatively cheap way of generating electricity.

      • bobn permalink
        August 23, 2022 10:22 am

        Yes Micky. The Chinese are impressive workers. Many of their construction sites have 24 / 7 working. They run 3 or 4 shifts on site and all work 6 plus day weeks. Thats why they can build things 4 times as fast as the UK where work is part-time. In China a road repair runs 24/7 until complete. Here its about 6hrs a day for 4 days a week. Our lack of work ethic is a modern wonder.

      • Carnot permalink
        August 23, 2022 11:22 am

        The oil and gas business is full of internet experts who read something that appears to be a magic bullet and suddenly we have energy abundance for the next 100 years. This was said in the 1970’s when the North Sea came on line.
        That Caudrilla and Jim Ratcliffe of Ineos have made a song and dance about UK shale does not make it a done deal. In the oil and gas business there are proven reserves, probable reserves, possible reserves, resources and bullshit, especially the latter. What determines if a reserve is produceable depends on the economics. The economics depend upon the expected recovery, quality of the rock, and the cost of production. Shale was ignored for many years until the advent of fracing. Fracing is not cheap; it substantially adds to the cost of the well and requires specialised equipment and staff, and a gathering system. Recovery factors are low.
        Too much hype has been expended on shale globally. In the US it looks as if shale oil is peaking as all the best locations have been drilled out. There is probably more scope for gas but even gas resources are not going to supply the US with endless gas for 100 years. In the UK we simply do not know how much of the resource is viable. There have not been enough wells drilled and evaluated. Very rearely the resource is homogenous- that means recovery will vary according to the resource geology, and too little is known at the present time to be certain that it is viable.
        I am not anti-fracking. I am a realist that has been in the business a long time.

      • Micky R permalink
        August 23, 2022 11:51 am

        ” Many of their construction sites have 24 / 7 working. ”
        As I recall, the construction of Sizewell B frequently involved 24 hours a day (two shifts), 11.5 days out of every 14 days. Day 13 and day 14 were generally much quieter to allow the “travelling men” to go home. However, the 24 hours a day working tailed off as the project progressed.

      • Vernon E permalink
        August 23, 2022 12:06 pm

        Carnot: I’m not going to argue the case for liquid fuels but of course the storage is feasible. But on fracking, yours is the only voice added to mine that its not going to save us. There is excellent stuff on the net deriving from the US experience with Marcellus and Barnett shales including a feasibilty study that demonstrates conclusively that the minimum viable revcovery per well is 600MCFD. Cuadrilla’s tests got nowhere near that (max 270 MCFD) despite far exceeding their permiited seismic impact limit (LM 2.7 vs LM 0.5) and even if 600 MCFD could be achieved it would take hundreds of wells (and as you say , all the gathering structure) to produce the same as the Morecambe Bay field – about 10% of UK needs. Its ALL about permeability. I, too, have followed (and posted about) the Poland experiences.

      • Vernon E permalink
        August 23, 2022 2:30 pm

        Carnot: Final word. By my reckoning the largest CCGT plant in the UK (2.2 GW at Pembroke) would require for 60 days srorage two tanks about 9 m h x 10 m d m – that’s not very large.

      • Carnot permalink
        August 24, 2022 11:01 am

        Vernon, Well I am glad that now there are two of us preaching caution on shale. I have been writing on various blogs about the limits of shale for nearly 15 years. You are right about permeability. Shale is all about nana-darcies of permeability when the conventional resouirces are in the milli-darcy range. A little publisiced fact. The US broadley produces abou the same amount of oil as the Saudi’s. The US has over 0.5 million oil wells and about the same gas wells. The Saudi’s produce their oil with less than 4000 oil wells. Roughly 50 % of all the oil and gas wells in the world are in the US. Go figure.

        You might like this blog. Mike is an old Texan oil man. He is seventy and he has worked his entire life in the Texas oil fields. A gold mine of information.

        I did a quick back of the envelope claculation for liquid fuels. Diesel is the most likely option but kersoine could also be considered. Handling wise diesel would be easier as it is combustible rather than flammable

        1 tonne diesel – 43 MJ
        In a CCGT at 48% efficiency that would give about 20 GJ at the alternator (rounded). For 4 GW output that would require 200 kg per second or 720 tonnes per hour.

        For 90 days supply that equates to around 1.64 million tonnes. That would require a tank of about 2 million cubic metres.

        For 2GW you can divide by 2. As the UK about 15GW of CCGT I reckon 25% of the capacity on liquid fuels would be the minimum.

      • Vernon E permalink
        August 25, 2022 2:57 pm

        Carnot: I wouldn’t bet the farm on my calculation and I certainly used too high an efficiency but I think your statement “1 tonne of diesel equates to 42 megajoules” is out by a factor of a thousand.
        It should be 1 kilogram of diesel. Also, neither of us applied an appropriate load factor. Generators do not run at rated capacity day and night and season by season. Probably 0.5 – 0.7 would be appropriate. Liquid fuelling is perfectly feasible (as illustrated by Ireland and India).

      • Carnot permalink
        August 25, 2022 5:09 pm

        You are quite correct . I quoted MJ instead of GJ per tonne diesel. That was a typo error. I checked my calculations and they are otherwise sound. I did not include a power factor as I have no idea what the power factor is – but most CCGT are run as base load- high output. My calculation was based on how much of the fuel energy is likely to be produced as work -i.e. electricity. 48% is probably on the low side which only means that the fuel consumption would decrease slightly at higher efficiencies ( claimed ” thermal efficiencies” are between 50-60%). To add grist to the mill the one thing the utility would be looking at is the working capital. 1.6 million tonnes of diesel will be upwards of $1.2 billion – dead money excluding the tank cost which would also not be cheap. Flexibility comes at a price. Dare I mention the Rough Gas field. For exactly these reasons.

  5. August 22, 2022 1:06 pm

    Back in early December ’21, I wrote the following to the Daily Mail …
    “The general public, out here in the real world are increasingly aware that, over the next few years, the ‘Old Habit’ of simply turning on the lights and the central heating will increasingly become a thing of the past. Already we seem to be having difficulty keeping street lights lit, this seems to be a major problem on the motorways causing significant danger; signs saying “Street Lighting Not In Use” are an increasing part of street furniture. Yet in parliament they seem obsessed with whether or not there was a Christmas Party in Downing street last year.
    The disconnect between reality and the Westminster Dream World, already significant, is becoming huge. There seems to be little point in voting one party out and an alternative in when that alternative is just as bad, if not worse, than the incumbent party. Is it just me or can anyone else see the political dangers in this situation?”
    Whether they took the message seriously at that point in time is difficult to say, but “Well I did tell ya!” springs to mind !

    • August 22, 2022 3:20 pm

      My thoughts exactly. All very depressing. Even my daughter has now got the CAGW BUG; So Climate conversation is now a ‘NO NO’ if aggression is to be avoided.
      IMO this all stems from the UN and its acolytes such as the IPCC et al. We had none of this nonsense before the IPCC was set up and started peddling its deliberate misinformation.

      • dennisambler permalink
        August 22, 2022 4:46 pm

        Absolutely right about the UN, but it goes back before and is much bigger than the IPCC. The first Earth Summit was in 1972, in Stockholm when the UN Environment Programme was started, led by Maurice Strong. We had the Brundtland Report in 1987, which became Agenda 21 at the Earth Summit in Rio in 1992.

        Agenda 21 has now morphed into Agenda 2030 and the Millennium Development Goals became the Sustainable Development Goals. IPCC was formed in 1988, and produced their first report in 1990.

        The UN Framework Convention on Climate Change didn’t happen until 1994 and they are responsible for the annual COP’s, Conference of the Parties to the UNFCCC. The “Parties” are just about every member country of the UN. The first COP was in Berlin in 1995.

        Politicians have more allegiance to UN Accords and Protocols than they do to their own electorates. They are even instructed to do so by the UN, viz Ban Ki Moon in 2012:

        “Governments and politicians are focused on pleasing constituents within election cycles.

        I have been urging leaders of the world not to be prisoners of their constituencies. When they have a vision and commitment they have to carry them out.”

      • Vernon E permalink
        August 23, 2022 2:36 pm

        denisambler: how very right you are in this analysis. All our political parties are signed up to UN Agenda 30 for Sustainability but you did not mention the malign influence of WEF and the men of Davos – especially the financial power they wield.

  6. August 22, 2022 1:31 pm

    I wonder how much of the low hydro levels are due to over consumption (follow the money, possibly including “carbon” shenanigans) rather than drought. This is what happened in Tasmania in 2015, shortly before Basslink broke, with drought getting the blame.

    If any system needs Central Planning this is it, but with no mention of carbon.

    • Phoenix44 permalink
      August 22, 2022 1:39 pm

      No system needs central planning because no system can be centrally planned. This has been demonstrated both theoretically and in practice time after time yet still as soon as there’s problems we call for our god-like central planners to save us. It is central planning that got us into this mess. Markets did not prevent fracking or discourage investment in fossil fuels. Markets did not close German nuclear plants or allow intermittent renewables to dominate grids. Markets did not shift the priorities of regulators from consumers to climate change. You now want central planning because you are using hindsight, the one thing not available to central planners.

      • August 22, 2022 3:29 pm

        Tosh, almost all systems that work well do so because of top-down design, the discipline of Systems Engineering. The UK electricity system started that way, it was ideological privatisation that ruined it, nuclear power would be nowhere without the original state ownership, and it is going nowhere as the state withdraws.

      • Duker permalink
        August 23, 2022 3:26 am

        Electricity is the exception to the no central planning rule.
        The output is consumed the instant it is generated and if the system is out of balance there will blackouts, either locally or nationally. There is no other product like this.
        Any way , even Tescos supermarkets is a centrally planned system, sure the government can have a ‘light’ regulatory rule but the central planning is there even if its not visible – except when theres empty shelves.
        the railways is another centrally planned system, indeed the idea of a single standard time came about so the railways could operate efficently and a timely manner

  7. Dave Gardner permalink
    August 22, 2022 2:00 pm

    The first driver of the European power crisis is given as “Very low French nuclear availability (EDF recently scaled back its output guidance for 2023 to 300-330TWh and is now facing cooling issues that are impacting an already weak 2022 availability)”.

    That particular issue is actually due to the Greenies rather it being something to do with nuclear power stations being unreliable. There are restrictions on how warm rivers are allowed to be in case it adversely affects wildlife, which impacts nuclear power stations which use river water cooling. But according to Breitbart, the French are currently bending the rules quite a bit to keep nuclear power generation as high as possible:

  8. John Hultquist permalink
    August 22, 2022 5:02 pm

    At 22 comments, may I go off topic . . .
    The British army and navy, in a stunning display of global force projection and military logistics, invaded Brooklyn by sea and launched the defeat of George Washington’s army in New York City on this day in history, August 22, 1776.
    The last British troops were withdrawn from New York in November 1783 and the Paris treaty was ratified by the U.S. Congress on January 14, 1784.

    The kerfuffle lasted 8 years.
    I predict the current problems of the UK will also last about 8 years, so look for better times in the fall of 2029!

    • Adam Gallon permalink
      August 22, 2022 5:13 pm

      So towards the end of the second Labour government of the 2020s?
      Because this lot aren’t going to be in power after the next election.

      • bobn permalink
        August 23, 2022 10:31 am

        Why does it have to be Labour, who are even dumber than this lot. How about the Reform/reclaim/ukip Govt which sweeps away the eco-nutters of the Lib/Lab/Con uniparty.
        Time for fresh Govt beyond the idiot cliques in westminster today.

      • Realist permalink
        August 23, 2022 2:06 pm

        The current lot are TINOS – Tories in name only

    • Duker permalink
      August 23, 2022 3:12 am

      Washingtons daring plan was to first retreat to Manhattan island and then out of the city entirely
      And thus it will be how the 1st Carbon Cold War will end

  9. Nicholas Lewis permalink
    August 22, 2022 6:45 pm

    UK gas prices through the roof today driving electricity prices to madness level. OK i know its spot but marginal pricing is going to drive the economy into a depression and then with associated demand destruction prices might drop but unless politicians give clear signals to oil&gas companies that they are an essential part of the decarbonisation solution for at least 20 years we are headed back to the caves and all we can hope for is that we avoid a societal meltdown during the transition.

  10. A+man+of+no+rank permalink
    August 22, 2022 7:52 pm

    Fascinating to watch our BBC News. They are concerned about the ever increasing energy bills. They ask for urgent help for the poor and demand action from our politicians. They cannot think beyond handouts and VAT/tax changes. And yet their policies of avoiding debate on the consequences of CO2 removal is a big part of the problem. As living standards decline it would be nice if our beloved BBC admitted some guilt.

    • Crowatcher permalink
      August 23, 2022 7:00 am

      Very well said.
      I’m a retired BBC engineer and I now feel ashamed that I ever worked for the lying b******ds!!!

  11. Jules permalink
    August 22, 2022 8:11 pm

    There could be a big change in the oil price soon if there is a nuclear deal on Iran and removal of sanctions. This would have a quicker effect than fracking for more shale gas in Britain. If the oil price was lowered a great deal ($60 per barrel) the Russians have a problem selling to India and China and keeping their war with Ukraine running – which is probably why they are flicking the switch on Nordstream1 pipeline now.

    • August 22, 2022 8:29 pm

      A very good site for monitoring the price of Gas and Crude Oil is ….
      As you will see the various types of crude, whether Brent or WTI etc are slowly finding their way back to more sensible levels as is oil based fuels (RBOB is a good price to monitor); at the same time natural gas continues to head skyward.
      Tax, unfortunately, continues to hold pump prices inflated.

      • Vernon E permalink
        August 23, 2022 2:40 pm

        All the more reason to fire our CCGT generators with liquid fuel(s). See earlier posts.

  12. August 23, 2022 8:35 am

    Don’t panic?

    Energy crisis: UK expands gas emergency exercise ahead of winter

    A regular emergency planning exercise to help the UK prepare for the possibility of a shortage of gas supplies has been doubled in size.

    Potential scenarios – including rationing electricity – will be wargamed over four days, rather than the usual two, as energy concerns grow.

    The government insists there is no risk to UK energy supplies and consumers should not panic.

    But industry say ministers need to do more to secure supplies this winter.
    – – –
    No risk? What planet are they on?

  13. MrGrimNasty permalink
    August 23, 2022 9:14 am

    Latest wind project online, BBC continues to celebrate shooting ourselves in the foot, with dishonesty about ‘cheap’ wind and how much useful power it provides.

    • Ray Sanders permalink
      August 23, 2022 10:45 am

      I have sent them an email requesting they get their own “Reality Check” team to check out their own absurd claims. Doubt I’ll get a response!

      • MrGrimNasty permalink
        August 23, 2022 12:32 pm

        They can get away with the homes count claim by using the expected capacity factor and the current UK average electric use.
        Of course it is other info. that needs to be added to give an honest context/cost.
        So they get away with it.

      • It doesn't add up... permalink
        August 23, 2022 2:37 pm

        Thought for the day:

        Since homes will obviously be cutting back heavily on electricity use, wind farms magically become much more productive.

    • Nicholas Lewis permalink
      August 23, 2022 6:12 pm

      What they should be doing is questioning why the system price and day ahead prices are over £600/MWh if wind is so cheap.

      The fact is the whole system is utterly broken and there is no choice but to put a CEGB body back in charge with the remit to deliver power at the lowest price possible with what they have at their disposal.

    • A+man+of+no+rank permalink
      August 23, 2022 7:44 pm

      I keep hearing that power from wind is the cheapest. I’m pretty sure that Paul challenged this a few months back. I wonder if there is an official source that would answer some simple questions I have.
      What price, recently averaged or right now, per kWh for electrical energy to reach my front door from the following:
      100% onshore wind / offshore wind / gas / liquid hydrocarbon / nuclear / hydro / coal / Drax wood and maybe undersea cable from France.
      Would be great to fire back a link to correct some romancer.

      • Nicholas Lewis permalink
        August 23, 2022 8:51 pm

        well its a dam site cheaper than CCGT generated with gas at current prices so as long as we are prepared to have electricity when the wind is blowing we will be alright………..

  14. Lez permalink
    August 23, 2022 3:42 pm

    I just hope there’s enough spare gas available this winter to fire up the crematoria to cope with all the excess deaths arising from hypothermia.

  15. August 24, 2022 1:05 am

    I can’t pretend to understand all this clever stuff in the article about forward pricing and the checks and balances in energy economics but it does seem to me that an analysis like this does no service to solving current problem so long as it avoids the elephants in the room of net zero and the rest of that “environmental crap”. I was surprised that Paul gives it so much credit in his by-line when it just feeds the politicians narrative that it’s all driven by lack of capacity with no examination of what drives that lack of capacity.

    Given the scale of the mess we’re in who cares if fracking or woodchip burning makes no commercial sense. We desperately need dispatchable energy and that trumps all other considerations (except capitulating to the Russians – I’d draw the line there).

    • Nicholas Lewis permalink
      August 24, 2022 5:31 pm

      Europe through its crass stupidity and adherence to morals that it doesn’t bother with in other parts of the world has bought itself along with the UK to the precipice of being reduced to third world status but with the downside that the population are ill equipped to deal with that status unlike the rest of the third world.

  16. Derek T permalink
    August 24, 2022 3:32 pm

    Wood burner sales must be doing well and access to a supply of used pallets is going to be very handy.

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