June 14, 2023 [BNN Bloomberg]- Britain’s energy security is at risk without more capacity to store natural gas for covering peak demand, according to the nation’s biggest supplier, Centrica Plc.
While a partial reopening in October of the UK’s largest gas storage, Rough, boosted the country’s capacity to stockpile the fuel, that’s not enough, Chris O’Shea, chief executive officer of Centrica — the facility’s owner — said Tuesday.
“We increased the UK’s gas storage capacity by 50% — this is no small achievement,” he said at the company’s annual shareholder meeting. “But this increase means that the UK now has nine days of peak winter demand in storage capacity, which is by far the lowest in Europe and is nowhere near enough to make our energy system resilient.”
Centrica, which reopened Rough at about a fifth of its former capacity late last year, sought consumer-funded minimum revenue guarantees to assist its longer-term investments in the facility. The company says that curbed storage capacities — just a fraction of Germany’s approximate 89 days of peak demand — highlight Britain’s vulnerability to prolonged cold snaps or supply disruptions. But negotiations with the government have not progressed.
Centrica ultimately plans to transform Rough into a major hydrogen storage facility, but gas will remain important for the market for years to come as a “transition fuel,” O’Shea said. Centrica’s teams are looking at ways to add more storage capacity for the forthcoming heating season, but the company needs the right regulation from the government for longer-term solutions.
No agreement has been reached with the government since Rough’s reopening, but the door remains open for future discussions, Centrica Chairman Scott Wheway said at the meeting.
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