UK GAS-Mild weather, wind, good supply cancel out Didcot fire

* Power prices drop as available wind capacity jumps

* But UK winter system looks tight after fire at Didcot station

* Over 5 GW of nuclear units are already off the grid

Oct 20 (Reuters) - British wholesale natural gas and power prices fell on Monday morning as mild weather sapped demand while stormy conditions boosted wind power capacity, outweighing an outage caused by a fire at Didcot B Power Station.

Power prices for baseload (24 hours) delivery on Tuesay were trading at 40.25 pounds per megawatt-hour (MWh), down 5.15 pounds or almost 15 percent since Friday's close, while gas prices for Tuesday were down 1.78 pence per therm (3.5 percentage points) to 48.22 pence.

The price drops were a result of low demand being met by relatively high supplies.

Gas demand was expected to be 201.3 million cubic metres (mcm) on Monday, around 6 percent above the seasonal norm, according to National Grid (LSE: NG.L - news) data.

With supplies seen at 213.5 mcm, the system would be over 12 mcm oversupplied.

"The long system and expectations of warm temperatures have seen prompt prices open lower this morning and continue to shed value," said Marcel Boonaert, head of trading and portfolio at gas supply company Wingas UK.

In power markets, it was a sharp rise in available wind capacity that pulled down prices.

Meteorologists said that Britain's wind power output was expected to rise from around 4,000 megawatt (MW) on Monday to almost 7,000 MW on Tuesday, outweighing an outage at RWE npower's 1,360 MW capacity Didcot B Power Station following a fire.

According to RWE (Xetra: 703712 - news) 's website, one 720-MW unit at the site, Didcot B5, has been taken offline. The other unit, Didcot B6, appears to still be in service.

The outage adds to 5,200 MW of nuclear capacity that is currently off the grid due to safety inspections, scheduled maintenance and because of unplanned outages.

While strong wind power capacity more than makes up for the Didcot outage in the short term, analysts said that Britain's grid could suffer from electricity shortages this winter if the weather gets cold and not enough power stations that are currently off the grid return to production.

"The UK has now seen three unexpected events... Another one or two could cause a serious security of supply event, and a probable surge in wholesale prices," investment bank Liberum said in a research note on Monday.

"The odds are still that (the) UK will escape a security of supply crunch this winter. But the mere fact that a security of supply crisis is a material possibility is in itself a sign of huge policy failure in our view," it added. (Reporting by Henning Gloystein, editing by William Hardy)