Grid warns of tighter market for gas next winter

Gas supplies to homes and factories could be tighter next winter because of declining North Sea production and uncertainty over the timing of new import facilities, National Grid warned yesterday.

The company said that wholesale gas prices were higher than for last winter and doubts about whether Britain's largest gas storage facility, Rough, could be filled in time could see supplies become tighter still.

Although all the major projects to increase the UK's import capacity were on time, they could hit delays and industry was urged to be cautious. "National Grid's report shows we potentially face another winter of tight gas supplies where demand-side response will again play a crucial role," said Alistair Buchanan, chief executive of the energy regulator Ofgem. He said there was no room for complacency on the part of industry. "Major infrastructure projects can be delayed and as we saw last winter, new pipes and terminals are not always used at full capacity to import gas."

The Trade and Industry Secretary, Alastair Darling, moved to speed up planning approval for gas storage facilities. Mr Darling laid a new "statement of need" which puts the onus on planners and local authorities to take the national interest into account when considering applications. Up to 10 storage facilities are planned but Mr Darling said the Government was becoming concerned that that "developers are facing unnecessary uncertainty and additional costs through avoidable delays in the planning system".