The firm was found to have secured “excessive payments” from National Grid ESO in exchange for reducing output at Foyers pumped storage power station during periods of what is known as ‘transmission constraint’.
When constraints on the electricity transmission system exist, the ESO will take action to manage flows across the network, including using the balancing market to increase and decrease the amount of electricity produced by different generators.
Situations which could cause transmission constraints might include times where there is insufficient network capacity to transport power out of a particular area in which local generation exceeds demand.
During these times generators can, in theory, exploit their position by charging the ESO excessive prices to reduce their output, but the Transmission Constraint Licence Condition (TCLC) prohibits them from doing so.
In October 2021, Ofgem opened an investigation into SSE’s compliance with the TCLC...