Blair's "winter of discontent"
This winter seems to building into a winter of discontent. The health service is facing substantial problems. The government's solution seems to be to reorganise it. We in Birmingham face either 1 PCT or 3 PCTs. In essence we are going back to a single health authority for the city - a situation much like it used to be about 10 years ago.
The withdrawals from storage appear to have ebbed for the weekend with demand running about 20 mcm lower and hence the withdrawals runnning about 20 mcm lower.
It remains that domestic customers are last to be cut off and that we will have enough gas to keep that going. However, any gas shipper (utility) short of gas is going to have to pay a system price something like 4 times what they would have done previously.
Actual demand yesterday is reported at 351 and forecast for today is 352 (mcm), but Monday jumps to a forecast of 374 - which should take withdrawals from long term storage back up to maximum. At 1pm, however, the forecast flows into the National Transmission System are only 333 which puts a demand on the reserves in the pipes (linepack). This implies that the nominated withdrawals from LTS were too small.
I am meeting up with industry about the energy situation again on Monday. At least they understand the maths behind this even if the government don't. Office temperatures are allowed by law to go as low as 16 C. A reduction in commercial demand by turning down commercial thermostats will have a real effect on gas consumption. The later such an adjustment is made the less of an impact it has. At least the parliamentary estate should turn down the thermostat. Almost all the variability in demand during winter is about heating.
If the market does not reduce demand (and I would estimate that prices have cut demand by about 20 mcm at the moment) then the national grid can start cutting off supplies.
If there is a recognised tightness of supply - which would not formally be done at this stage in any event - it goes through the following steps.
- Stage 1 – notice of impending emergency. This indicates that there is a potential gas emergency, but that people might be able to resolve it without cutting off any users.
- Stage 2 – declaration of emergency. The OCM is suspended and the
primary transporter starts cutting interruptible people off.
- Stage 3 – firm load shedding. Firm load shedding is divided into three tranches of increasing severity and effect. The three tranches are:
- very large end-users (VLDMC) (those taking more than 50 million therms per annum (tpa)(
- large end-users (those taking between 25,000 tpa and 50 mtpa)
- end-users taking less than 25,000 tpa
- Stage 4 – system isolation. The available gas would be allocated to secondary systems supplying domestic end-users;
- Stage 5 – restoration. Normal arrangements are restored.