National Grid ‘confident’ lights will stay on this winter despite electricity supply squeeze

Comments come amid fears of energy crisis as prices soar and demand for gas and electricity increases

(Getty Images/iStockphoto)

The National Grid says it’s “confident” Britain will have enough supplies of gas and electricity to “keep the lights on” this Christmas.

Firms will have adequate supplies over the coming months, the utilities company said as it seeks to assuage concerns of an energy crisis amid soaring prices and increased demand.

“We have a positive gas supply margin in all of our supply and demand scenarios, and there is a positive storage position as we enter the winter,” Ian Radley, director of gas system operations, said.

“We have a range of tools available to manage any operational requirements that we might encounter,” he added.

NGST said the UK has access to flexible supplies of gas from abroad, including liquid natural gas (LNG), which is brought in on ships, and gas pipes from Europe.

This will be enough to meet all the scenarios of peak demand that National Grid experts have predicted could happen from October to the end of March, the firm added.

The firm’s comments came as Russia suggested approval of the Nord Stream 2 undersea gas pipeline, which is awaiting clearance from Germany’s regulator, could help to cool overheating prices.

The project has failed to win the backing of the US over fears that the pipeline would increase Europe’s reliance on Russia for energy.

Demand for energy is soaring as the global economy bounces back following lockdowns during the Covid pandemic. Demand is particularly high in Asia, where economies are reopening.

Gas and electricity bills are set to jump by one third for millions of households in the UK this spring.

The wholesale price of natural gas has soared in recent weeks and reached record levels on Wednesday, driving up prices, with experts warning the worst is yet to come.

NGST warned that, as in previous winters, gas sellers will “require a positive market price differential in order to flow to Great Britain from both European and global markets,” National Grid said.

It means that British buyers will have to compete with international buyers for their gas.

“We have a positive gas supply margin in all of our supply and demand scenarios, and there is a positive storage position as we enter the winter,” Mr Radley said.

“We have a range of tools available to manage any operational requirements that we might encounter.”

Meanwhile, the National Grid Electricity Electricity System Operator (ESO) said the electricity system’s capacity should also cope with the winter.

“The Winter Outlook confirms that we expect to have sufficient capacity and the tools needed to meet demand this winter,” ESO boss Fintan Slye said.

"Margins are well within the reliability standard and therefore we are confident that there will be enough capacity available to keep Britain’s lights on.”

The gas system operator also said that it expects demand to be just 49.4 billion cubic metres (bcm), down from 50.7 bcm to 53.3 bcm over the last five years.

This drop in demand is in large part down to a drop in demand for gas for electricity production, as more wind power is built.

National Grid Gas Transmission is tasked with providing the gas grid across Great Britain and occasionally stepping in to ensure the system is balanced.

However it does not itself supply gas into the grid.

Around half of Britain’s gas demand is used to heat homes, another quarter is used to generate electricity.

Additional reporting by Press Association