MPs call for more gas storage plants to boost energy security

Current capacity extends to only 14 days'worth of the gas supply the country requires

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The Independent Online

The Government needs to step up its efforts to protect the UK's energy supplies from short-term shocks, with the country's "dangerously low" gas storage capacity leaving it prone to supply interruptions and sudden price spikes, an influential group of MPs will warn this morning.

The Energy and Climate Change Committee will also point out that, while the UK is growing increasingly dependent on energy imports, the Department for Energy and Climate Change has not "published a strategy for achieving energy security", in contrast to its approach to climate change.

"In an uncertain world, the UK needs to think hard about its energy security," the committee's chairman, Tim Yeo, said. "The UK will become more dependent on energy imports as North Sea oil and gas declines, but prudent planning can ensure this doesn't reduce our energy security too drastically."

In their report on energy supply, the MPs highlight the fact that the UK's current gas storage capacity – an important component of energy security – extends to only 14 days' worth of supply. This is in sharp contrast to France, whose storage capacity amounts to 87 days' worth of supply. Germany boasts a capacity of 69 days.

The biggest facility in the UK is the Centrica-owned Rough gas storage facility in the southern North Sea.

The MPs also say that the Government needs to avoid measures that might hit confidence among energy investors. "The way in which the £2bn levy on North Seas producers was announced in [the] Budget ... may have undermined investor confidence," the report says.

The committee also took issue with the proposals in the White Paper on electricity market reforms, saying that it was "not convinced" that they "strike the right balance between encouraging investment in new gas-fired plant[s] in the short term ... and the need to decarbonise the power sector over the course of the 2020s."

Moreover, more action was needed to cut waste. "The Government could be doing a lot more to reduce unnecessary energy wastage. It needs to look at how it can use building regulations and energy efficiency standards for electrical appliances to cut waste and save cash on people's energy bills," Mr Yeo said.

Responding to the report, the Energy minister, Charles Hendry, said: "Energy security is right at the heart of the Coalition's energy policy ... We are reforming the electricity market to encourage investment in new power stations. We have consented proposals for gas storage facilities that more than double our capacity and have legislated to give Ofgem the power to incentivise the gas market to ensure secure supply."