Q2 2024: Britain imports one fifth of its electricity

Electricity imports have reached record levels, with 19.8% of demand met by overseas sources over the three months to June. For the first time ever, more than a tenth of electricity came from France alone, and the cost of imported electricity rose to over £250 million per month. Overall, Britain imported 12.2 TWh last quarter, more than the country’s nuclear output (10.7 TWh), and close to total production from fossil fuels (13.6 TWh). In comparison, exports were just 3 TWh.

Gross electricity imports and exports as a share of British electricity demand each quarter.

For decades, Britain has imported more electricity than it exported, as neighbouring France has plentiful cheap nuclear power. In recent years, the stronger carbon price in the UK (specifically an £18 per tonne surcharge paid by power stations) made it more expensive to generate fossil-fuelled power here. However, the UK left the European carbon market after Brexit and launched its own. While the £18/t surcharge is still in place, Britain’s market now trades at around £20/t lower than Europe’s, bringing the cost of generating electricity from fossil fuels into line with the continent.

Much of Britain’s conventional generation has retired in the last decade, with 18 GW of coal, 4 GW of nuclear, and 3 GW of gas power shutting down. Fewer generators means higher prices as there is less competition between suppliers, but capacity changes on the continent are also influencing electricity trade. Much of Europe now has excess power generation, as countries have rapidly expanded their solar PV capacity to reduce reliance on Russian gas. Germany and the Netherlands installed 28 and 14 GW over the last three years (compared to just 2 GW in Britain), so spring and summer are now characterised by negative prices across the continent, which Britain can import at low cost.

On the one hand, Britain’s growing dependence on its neighbours for electricity goes against the government’s push for energy independence. On the other hand, interconnectors help to balance out the variability of wind and solar power, and support the aim to rapidly decarbonise electricity. There is a key distinction to make between importing because we are unable to supply our own needs versus importing to lower the cost of electricity. We are doing the latter – so developing further interconnector capacity is not a vulnerability, it is a strength. It will be a vital part of making Britain a “clean energy superpower” as the government intends. Reaching their 2030 targets of 80 GW of wind and 50 GW of solar will leave the UK with more annual generation than demand, and having the infrastructure in place to export excess production benefits everyone.