Consumers pay the price of relying on gas, instead of nuclear, to fill power gaps

The cost of the grid’s Balancing Mechanism (BM) reached a record of almost half a billion pounds in November, with consumers ultimately footing the bill for the UK’s fragile electricity system. According to NIA analysis of market data, November’s balancing costs were equivalent to every UK household paying an extra £17.50, as National Grid ESO says that “those costs are ultimately borne by consumers.”

In contrast, building a new nuclear power station would cost less than £1 per month for consumers and would cut costs by £30 billion in the long-term.

Data from LCP Energy shows November Balancing Mechanism costs of £484 million were 220% higher than November 2020, which reached £151 million. Since September 1st this year, the cost of the UK’s Balancing Mechanism has totalled more than £1 billion and is on course to be the most expensive year on record for BM costs. That figure is equivalent to every UK household paying an extra £36.

This is the consequence of the UK relying on imported gas to fill the gaps in the electricity generation when output from other sources is low. New nuclear stations, enabled by the Regulated Asset Base (RAB) financing bill, would cut the UK’s need for expensive fossil fuels to cover gaps in generation, and provide a backbone of firm, clean power.

A large-scale nuclear project financed using RAB would only add a small levy to bills of no more than a few pounds during the early phase of construction and less than £1 per month over the course of a project.

The Balancing Mechanism is one of the main tools that National Grid ESO uses to balance supply and demand in real-time. The mechanism is needed because electricity cannot be stored and must be generated at the time of demand.

Tom Greatrex, Chief Executive of the Nuclear Industry Association, said:

“The billions the UK is spending to prop up an unstable grid is the price of not investing in nuclear energy. We urgently need to get going with multiple large-scale stations and a fleet of SMRs to provide stable, predictable, clean power and to avoid these very costly and very damaging fossil-fuel induced crises in the future.”


Notes to editors

  • The ONS estimates there are 27.8 million households in the UK.
  • Balancing Mechanism Costs for December 2021 have reached £100 million.
  • Daily balancing costs are available from LCP Energy at and further information on spot prices at
  • The UK has seven generating nuclear power stations, providing around 16% of the country’s electricity.
  • Nuclear has saved the UK 2.3 billion tonnes of carbon emissions, far more than any other source. The saving is equivalent to all UK emissions from 2015 through 2020.
  • Four stations will retire by March 2024, including Hunterston B by 7 January 2022, and all but one will retire by 2030.
  • Nuclear provides 10% of global electricity, enough for hundreds of millions of people, and has saved more than 70 billion tonnes of carbon emissions in total.

About the Nuclear Industry Association
As the trade association for the civil nuclear industry in the UK, the Nuclear Industry Association represents more than 200 companies across the UK’s nuclear supply chain.

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