MemberSeptember 19, 2021 at 8:01 am
Natural gas prices are at record highs as economies around the world begin to recover from the Covid crisis.
In the UK, lower winds have meant less renewable energy is generated. There have also been outages at some nuclear stations and lower flows into the UK of natural gas from Norway, pushing up the price of natural gas.
Industry group Oil & Gas UK said wholesale prices for gas are up 250% since January – with a 70% rise since August.
The Department for Business, Energy and Industrial Strategy (BEIS) reported that in 2020, 60% of the UK’s natural gas supply was imported.
Mr Kwarteng is talking to chief executives from gas producers, the National Grid, suppliers including Scottish Power, EON and EDF, and the regulator Ofgem.
The business secretary said energy security was “an absolute priority”.
The Department for Business, Energy & Industrial Strategy said on its website: “While we are not complacent, we do not expect supply emergencies this winter.”
Dermot Nolan, director at Fingleton Strategic Consultancy and former chief executive of Ofgem, told the BBC gas prices have increased not just in Britain but all over the world, with “Germany and Spain experiencing similar types of increases”.
He said “high gas and high electricity prices will be sustained for the next three to four months”, adding that it was difficult to see what the government could do about it.
Shadow business secretary Ed Miliband said the government must “ensure security of supply and take the long-term action to put in place a much more robust, resilient and diverse energy infrastructure”.
He said: “It is a fundamental failure of long-term government planning over the last decade that we are so exposed and vulnerable as a country and it is businesses and consumers that are paying the price.”