Why UK gas storage levels are 'concerningly low'

Plunging temperatures successful caller weeks and the extremity of Russian state deliveries via Ukraine person wounded state inventories successful the United Kingdom, the country's main state supplier Centrica said connected January 10, warning that state supplies were now"concerningly low."

Centrica reported that UK state stocks were 26% little past week than the aforesaid play successful 2024, astatine astir fractional full. The institution added that the state had little than a week of stored state to vigor homes and businesses.

On Saturday, the UK's state retention facilities were conscionable 42% full, according to a tally by Gas Infrastructure Europe (GIE), Europe's relation of state infrastructure operators.

By comparison, Germany's state retention facilities were nearly three-quarters full, portion Poland's were still more than 80% full.

The GIE information showed Britain has the smallest magnitude of state held successful reserve retired of the 20 European countries listed.

Why are the UK's state stocks truthful low?

Going into the fall, Britain's gas retention facilities were lone a maximum of two-thirds full, compared to Germany and Poland, which had filled their tanks to much than 90% of capacity by September.

There are respective reasons for the disparity. The UK has overmuch little state retention capableness than other European countries — astir 3.2 cardinal cubic meters (bcm), 7 times little than Germany and 5 times little than the Netherlands.

Britain's retention facilities tin clasp capable gas for 12 mean days oregon conscionable implicit a week during winter, portion Germany has capable for 89 days.

The UK's largest state retention hub, located successful the North Sea disconnected the east coast of England, is presently operating astatine constricted capacity.

The Rough facility used to account for 70% of the UK's state retention capableness but was closed successful 2017 owed to information concerns and precocious attraction costs.

The Conservative authorities of then-Prime Minister Theresa May had refused to subsidize an upgrading plan. However, aft Russia launched its full-scale invasion of Ukraine successful February 2022, sparking an vigor situation passim Europe, the authorities pressed Rough's owner, Centrica, to reopen the facility.

When operations did resume, they were astatine astir 20% of their previous capacity. Since then, capableness has doubled but is inactive acold from its archetypal level.

So volition Britain tally retired of gas?

Despite falling state successful storage, National Gas, which runs the UK's state transmission system, insisted the state would person capable to proceed heating homes and businesses for the remainder of the winter.

"The wide representation crossed Great Britain's 8 main state retention sites remains healthy," a National Gas spokesperson told quality bureau Reuters successful an email.

"Britain obtains its state from a divers scope of sources beyond that already successful storage, meaning we are good placed to respond to request this winter."

A spokesperson for UK Prime Minister Kier Starmer told reporters successful London that the state was connected the verge of an vigor blackout were "not true."

"We talk regularly with the nationalist vigor strategy relation to show our vigor information and guarantee they person each tools astatine their disposal if needed to unafraid our supply," the spokesperson added.

UK state and energy prices spiked during the 2022 vigor situation with immoderate facing a prime of whether to 'heat oregon eat'Image: SUSANNAH IRELAND/AFP/Getty Images

Why is the UK susceptible to rising state prices?

The UK has taken a antithetic attack to state proviso than its other European peers, preferring alleged just-in-time proviso done imports and home accumulation implicit retention facilities.

Britain relies on home state piped from the North Sea for astir fractional of its needs. It buys the remainder connected the unfastened marketplace based connected real-time request and existent prices.

On the different hand, Germany, France, Austria and Italy had introduced mandatory state retention requirements at the nationalist level until a European Union rule took effect successful June 2022 that each EU states indispensable refill their state retention facilities to 90% capableness by November 1 every year.

The UK's strategy mostly worked good during an epoch of inexpensive energy but near it susceptible to paying overmuch higher prices during periods of highest state request — including in the aboriginal months of the Ukraine war, wherever prices accrued twentyfold.

Although lone astir 5% of the UK state needs came straight from Russia, the nation's free marketplace attack meant it was besides severely impacted when other European countries scrambled to find alternative supplies to chopped their reliance connected Russian energy.

The extremity of the Ukraine transit deal past month, when Russian state stopped being piped done the war-torn country to Europe, besides helped spike UK state prices by up to 20%.

The UK's biggest earthy state suppliers are Norway and the Netherlands, portion Qatar and the United States supply liquified earthy gas (LNG).

Britain, similar different European countries, is importing much liquified earthy gas, stored successful immense tanksImage: Adrian Greeman/Construction Photography/Photosh/picture confederation

Will Britain boost its state retention capabilities?

While the UK authorities has made it a precedence to regenerate fossil fuels with renewable energy, caller argumentation papers person restated the request to boost state retention facilities to guarantee a stable supply, arsenic upwind and solar are intermittent vigor sources.

However, the state has not announced plans to present minimum state retention levels.

Centrica has projected a 2 cardinal lb ($2.43 billion, €2.38 billion) concern to return the Rough retention installation to afloat capableness and has called connected the UK authorities to assistance underwrite the concern risk.

A proposed terms headdress and level mechanism would spot the country's vigor regulator efficaciously subsidize portion of the outgo of upgrading the Rough installation if it doesn't crook a steadfast profit.

In return, the institution would beryllium forced to return any excess profits from state retention to the energy regulator, for illustration during an vigor crisis when prices surge.

Edited by: Uwe Hessler