Homes could be plunged into darkness this winter as the nation faces the shocking prospect of power cuts. The warning, following the release of grim industry figures yesterday, will dredge up memories of the last electricity crisis in 1974. Then, households had to manage with candles, factories were put on short-time and TV broadcasts ended at 10.30pm. The figures from the National Grid suggest that the country could be crippled by energy shortages when the colder weather bites because there is so little spare capacity. The loss of only one of our 38 biggest power stations at times of high demand could lead to breaks in supply, bringing factories to a halt and leaving many homes in darkness. ‘We should be very worried - this is reaching national crisis proportions but the response is piecemeal and inadequate,’ said the industry watchdog. In addition, the rising cost of power could also prompt further ’savage’ hikes in families’ energy bills, analysts claimed.

The National Grid figures sent the price of wholesale electricity skyrocketing to record levels yesterday. It also focused attention on the Government’s faltering energy policy and evoked memories of the grim period between January and March 1974 when millions endured regular blackouts. Last night Allan Asher, chief executive of Energywatch, warned of a national crisis. On prices, he added: ‘Consumers are being bled white by the generators and the retailers. The outlook is for further price shocks for consumers.’  
Eggborough Power Station, a coal fired plant near Selby: Restrictions on coal-burning could also hamper capacity.  The National Grid figures detail exactly how much power it expects to have in reserve this winter above its minimum safety target. It said that surplus supplies will be as little as 826megawatts, or 1.5 per cent of total consumption. Only last week, it estimated that the available back up would be 1,373 megawatts.

Such a dramatic reduction in the figure led experts to question whether the country has enough in reserve. The problem, say experts, is that Britain’s ageing and unreliable power generating infrastructure urgently needs billions of pounds of investment. In particular, British Energy has seen a spate of nuclear power plant closures because it is struggling to keep the sites operating. Coal-fired stations are being forced to limit their output because of pollution controls on the amount of carbon dioxide they pump out. This means utilities are often turning to inefficient, oil-fired power stations to make up shortfalls. Britain’s increasing reliance on wind power will also not help, given that output fluctuates wildly depending on the weather. The alarming outlook prompted dramatic moves in wholesale power prices on the financial markets yesterday. The cost of electricity soared to a record £105.25 a megawatt-hour, more than double the £45.90 level for winter a year ago. In May, half a million customers were hit by power cuts after a series of unexpected problems at power stations forced the National Grid to conserve supplies.

Experts have repeatedly warned that Britain will face dangerous shortfalls in its generation capacity by 2015. Even if supplies were imported from France, the likelihood is that they would not make up the shortfall. Yesterday’s moves in power markets reflect fears among traders that we face a power crisis far sooner than that. A spokesman for the National Grid said the outlook was published to encourage power firms to adjust their programme of maintenance over the coming months and he tried to play down the shortage fears. He said: ‘There are a few weeks where because of the pattern of generation outages it (the surplus) has gone down close to our target. But it still above our target.