Extreme weather tests U.K. gas security to the limit

Until recently the government did not seem phased by the closure of Rough, despite industry calls back in November to review the situation. Reportedly, it is now thinking again. With limited storage, the U.K. is dependent on sufficient gas being in the LNG tanks and on being able to get more gas from Norway and continental Europe. But there are physical limits on the pipelines that carry that gas.

Back in December a combination of a fire at the Baumgarten gas hub in Austria, technical problems in the North Sea and with the interconnector pipelines that enable imports from northwest Europe, and congestion on the National Transmission System (NTS) operated by National Grid, all resulted in shortage and a short-lived spike in the U.K.’s gas price. Things soon rectified themselves and it was back to business as usual.

This time is different
But, this time is different, as a prolonged period of cold weather right across Europe is resulting in a surge in gas demand, that is projected to reach a six-year high.

The surge in demand in the U.K. also puts additional pressure on National Grid to move gas around the system. Back in December, congestion limited the ability of the interconnectors to supply gas. At present, the LNG tanks are about 35% full, thanks to recent deliveries from Qatar and Russia, and gas is flowing from all three terminals. But it takes two weeks for an LNG tanker to get to its Welsh terminal from Ras Laffan in Qatar. Thus, the U.K. has to work with what it has at the moment.

With demand in the U.K. surging to more than 400mscm a day (compared to normal seasonal demand of 304mscm), a loss of capacity from any source of flexible supply, due to technical problems or an inability to attract sufficient gas from European markets, can lead to a supply emergency like the one just seen. If there were also technical failures on what is an ageing infrastructure, a prolonged cold spell could make things difficult.

The EU has introduced new policies in relation to gas security, including a “solidarity principle” which requires member states to help one another in an emergency. What happens if the U.K. leaves the EU’s internal energy market? Equally, what happens in Ireland, which is dependent on the U.K. for its security of supply? It’s yet another Brexit issue to contend with. If not, a cold shoulder from Brussels could end up being just as damaging as the Beast from the East.

Michael Bradshaw is Professor of Global Energy, Warwick Business School, Warwick Business School, University of Warwick. This article is published courtesy of The Conversation(under Creative Commons-Attribution / No derivative)