Tuesday, March 14, 2006

Gas continues to be taken from storage, emergency still 'likely'

John Hemming MP, Chairman of the Independent Energy Scrutiny Panel, challenged the government over their failures in dealing with gas supply in the House of Commons.

As a result of Mr Hemming's "Urgent Question", the Secretary of State for Trade and Industry was summoned to the house to answer MPs questions about the crisis in the gas market.

"When people get their gas bill", said Mr Hemming, "they need to understand that it has gone up through the failures of Tony Blair and the Labour Government. Their cavalier attitude to the security of energy supply is hitting people hard in their pockets. Many thousands of people will be losing their job as a result of the UK having gas prices for April something like 50% more than the USA."

"The government have failed to ensure that the market rules established by Ofgem ensure that people import gas on milder days and put it into storage. On the colder days, then, we can neither import gas nor can we get it from storage because it has not been stored."

"Yesterday another 425 GWh (38 mcm) was taken from Medium and Short Term Storage leaving only 2610 GWh (a seventh was taken out in one day). As the gas continues to be depleted from storage the maximum output is also depleted. We have perhaps 3 more days at maximum from Medium Range Storage before MRS is limited to 10 million cubic metres a day."

"Whether we have a formal gas emergency or not depends almost entirely upon the weather. The current cold snap is expected to continue through into the weekend. The North Atlantic Oscillation is also expected to be negative for some time. This will also encourage colder weather."

"We are cutting our safety limits to the bone. I do not expect us to have to disconnect any domestic customers, but I am very worried about the risks the government and regulators are taking with the UK's energy supplies. The problem with delaying action until the last minute is that the action that is taken has to be more severe."


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