MPs will investigate UK gas security following pressure from major energy users.
The Gas Security Group had been pushing for government to quantify the consequences of a lack of gas storage even before the cold snap last March forced National Grid to issue a warning that the UK was close to running out of gas.
Some of its members believe the UK was lucky not to have entirely depleted gas reserves when the ‘Beast from the East’ hit.
Major energy users have long voiced concern about the UK’s reliance on imported gas and lack of gas storage. They have become increasingly worried since the closure of Rough, which represented about 75% of the UK’s gas storage. Fears have been compounded by a lack of certainty about UK-EU market co-operation post-Brexit.
Given the damage a crash stop can inflict upon large manufacturers’ equipment, some see “a small increment on gas bills” to pay for new gas storage as a “better outcome” than being forced off the system or at the mercy of massive price spikes.
Calls for a review of gas security had appeared to fall on deaf ears. However, Beis Select Committee Chair, Rachel Reeves, announced the inquiry at the Energy UK conference this week.
Gas Storage Group (GSG) spokesperson, Clive Moffat, welcomed the news.
“Gas has a major role to play in providing heat and power in the foreseeable future and ensuring continuity of supply at an affordable price is critical to the future well-being of the UK economy and consumers,” he said.
“Gas security is an issue that requires the immediate attention of policy-makers and the GSG is looking forward to the opportunity to present written and oral evidence to the Select Committee.”
National Grid said last week that it expects there will be ‘sufficient’ gas to meet demand this winter.
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You write that some see “a small increment on gas bills” to pay for new gas storage as a “better outcome”. Nonetheless I am willing to bet that it won’t stop the very same people moaning about any subsequent price increases.
Such is life, but more broadly it’s an interesting question. Pay a premium to insure against something that may be one in 10 or even 20 year event, or risk silly rates if (when) tightness materialises. Markets always know best, right?