Ofgem report confirms fears of power shortage

UK energy regulator Ofgem have said that the risks to the electricity supply over the next six winters has increased since the last report in October 2012 due primarily to a deterioration in the supply side outlook, although there is also uncertainty over projected reductions in demand.

Since last year, the industry has announced the withdrawal of more than two gigawatts of installed generation capacity in the near future and further withdrawals are likely. Meanwhile uncertainty around policy and future prices is limiting investment, and no new plant is expected before 2016.

By the end of the decade, Ofgem estimate around one gigawatt of new gas plant will come online and the installed capacity of wind power to double.

Britain's spare power production capacity could fall as low as two per cent in two years' time, increasing the risk of blackouts.