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UK Gas Shortage

I have received some criticism from Labour about being concerned about the UK Gas Shortage.

It is quite clear that there is a shortage of supply. The impact of this shortage is mainly resultant from the ambient temperature. The colder it is the worse the impact.

More importantly the government can act to minimise both the possibilities of a Gas Emergency and also the impact of a gas emergency. I have put proposals to the government for action. Every day they delay makes things worse.

Whilst it is warm, as now, they should be maximising imports and ensuring that they go into storage. When it is cold they should still be maximising imports. Decisions were taken by Ofgem (that the government has to accept responsibility for) that have impact on supply security (such as UNC044).

Furthermore, the government could act to reduce demand at peak times. There are many places that are kept at far too high a temperature. Commercial operations are considered to be the same as the residences of elderly people. The fact is that if the temperatures in hotels and officers were lower then we would use less gas.

The formula the IESP use for calculating gas usage is that developed by IneosChlor which at low temperatures relates each degree centigrade to about 28.8 mcm/d of demand.

The different levels of real problems that result from the gas shortage are the following in order of severity.
  1. Economic Issues With the price of gas going high firms are put out of business as they cannot compete with the continent. With a lack of concern from government for the impact on business they decide that the UK is not a place to do business. This is already happening. This affects the tax take of the government as well as undermining our employment situation.
  2. Gas Emergency 1 At this level when the safety monitors are breached emergency action has to be taken to shut down demand. The easiest target for this is the Electricity Generation (42.5% from gas). A reduction in voltage occurs - a brownout.
  3. Gas Emergency 2 More CCGT is taken offline and we see rolling blackouts.
  4. Gas Emergency 3 We still don't have enough gas and we see supplies being cut off to local delivery networks. At points 2 and 3 there will be human casualties as a consequence.

There is a greater danger if pressure goes down in the gas pipes. That is why people are cut off rather than have the pressure go low.

It may be that there is no gas emergency. This still looks unlikely. Most of my earlier predictions were based upon the weather a week ago which would have led to a gas emergency in late Jan early Feb. If it stays as warm as it is now then there will be no problem. However, we can only last 3 days at an average daytime temperature of 1-2 C.

A responsible government would be doing more to deal with the issue. They would be discussing it sensibly with people and considering options to reduce demand from commercial premises. (much of which is heating). They would also be acting to deal with the perverse behaviour of the market which is undermining our economic and national security at the moment.

The market reacted to the early removals from gas. All of the information about the market is publicly available if you understand it. The IESP has a mailing list to which we send the daily gas analysis.

At some stage I will start adding up the missed opportunities in millions of cubic metres of gas. For more details about gas please read my Gas issues blog.

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