System Price Of Electricity

9th March 2023

The System Price of electricity, made available by Elexon, is used to settle the difference between contracted generation or consumption of electricity, and actual generation or consumption, in each half-hour trading period in the Balancing Market, the mechanism used to balance supply and demand in Great Britain's electricity market.

Companies are contracted to generate or consume a certain amount of electricity within each half hour (known as the Settlement Period). However, this may differ from the actual amount generated or consumed. Where companies have generated more or less than the amount of energy their customers consume, this difference is balanced by the UK's National Grid Transmission System, which buys or sells enough electricity to reconcile the difference. The System Price is designed to reflect the cost incurred by National Grid in doing this.

More information about how prices are calculated is available on the Elexon website.

We have taken a daily average of the half-hourly system prices and averaged them again over the preceding seven days to bring out the trends and smooth volatility.

The System Price of electricity in the week to 5 March 2023 increased by 15% when compared with the previous week and was 48% below the level of the same week in 2022.

The short-term trend in 2023 seems to have settled from the peak seen in mid-December 2022 with only minor fluctuations in the year to date, however, the latest level is still much higher than the pre-coronavirus (COVID-19) baseline. The latest week's level was 348% higher than the February 2020 baseline. Our accompanying System Price of electricity dataset is available.

Read the full ONS report with links HERE