
In simple terms, the 'plant margin' is the amount by which the installed generation capacity exceeds the peak demand. Thus a system with a peak demand of 100MW and 120MW of installed generation has a 20MW plant margin, which represents 20% of the peak demand.
Some commentators assume that the plant margin is surplus or excess generation, which is not necessary to the power system. This is incorrect since generating units are subject to breakdown and need to be taken out of service from time to time for maintenance and repair. Generating units are not available to generate 100% of the time.
If it is assumed that only 85% of the total stock of generating plant could be predicted to be available at the time of winter peak demands several years ahead, then it would be necessary to plan to meet that peak demand (100%) with only 85% of the generation. This would mean that an installed generating capacity equivalent to about 118% of the peak demand (i.e. 100 ÷ 0.85) would be needed in order to meet the peak. Further allowances would also have to be made for other factors such as the risk that the weather might be colder than the Average Cold Spell (ACS) conditions on which demand forecasts are based.
It was for reasons such as these that, in the past, large integrated power system utilities (e.g. the Central Electricity Generating Board in England and Wales) sought to achieve a plant margin of some 24% several years ahead of the event. This margin was referred to as the 'planning margin' rather than 'plant margin' (i.e. the planning margin was the value of plant margin used for planning the need for future generation).
An appropriate minimum value of 'plant margin' is therefore necessary for the security of electricity supply and does not represent surplus or excess generation. The actual required value of plant margin will be a function of the characteristics of the power system to which it applies.
The higher certainty associated with short term forecasts of say demand and generating unit availabilities means that the same level of security of electricity supply can be achieved with lower plant margins. Accordingly, the required margin for the earlier years would be much lower and the operational planning margin requirement for real time generation is generally around 10% depending on prevailing circumstances.
This chapter focuses on the planning time phase and relates to the security of supply provided by the generation capacity that is either already installed or is planned to be installed. The operational time phase, which relates, amongst other things, to the actual availability of the installed generation on the day, has not been specifically addressed.
In the privatised electricity supply industry within England and Wales and Scotland, there is no set standard for the planning margin and the need for new plant is determined by market forces.