Arctic blasts hit power systems and industry budgets
7 Jan 2026
Plunging temperatures sent industrial and domestic power demands peaking, with a substantial increase in fossil fuels use to fill the supply gap.
National demand on 5 January left renewable sources able to meet less than a quarter of the overall requirement, said Jake Thompson, GB Market Expert at Montel Analytics.
“National electricity demand surged during peak hours as temperatures plunged. Morning peak demand reached 44GW today, with Montel EnAppSys forecasts suggesting demand could rise to around 46GW during the evening peak. On Monday, GB recorded its highest demand since March 2018 at 47.3GW,” he stated.
“As a result, 23% of demand was met by renewables on 5 January, the day of the demand peak, leaving the system heavily reliant on the conventional gas-fired generation fleet during peak periods.”
NESO, the National Energy System Operator for Great Britain, was forced to intervene in interconnector markets in order to offset pressure on domestic supply.
With interconnectors due to export power to Denmark, Belgium and the Netherlands from early on the same day, NESO then sought to purchase substantial volumes at auction.
At 1pm on the same day it was paying prices of up to £1,040/MWh, said Thompson – more than 10 times the weighted day-ahead price for the same hour.
The situation was worse in the Netherlands, however, where generators had already resumed their own exports, only to find imports from Great Britain reduced as Dutch prices paid surged above €4,000/MWh.
Industry users in the UK face a further concern this week, added Thompson, owing to reliance on gas-fired generation. A predicted fall in wind output could further limiting renewable supply, “increasing upward pressure on wholesale prices” he predicted.
