Gas wholesale prices in the UK remained at near record highs on March 14 on the back of the 'gas balancing alert' from the National Grid, prompting the UK minister for trade and industry to move to quell concerns over supply.
The sustained high spot gas price prompted further comments from industry stakeholders that Britain is facing a gas supply ‘crunch’. The warning from National Grid has led some industrial users to admit that production was being affected by the price spike, while the chairman of the Confederation of British Industry, Sir Digby Jones, declared that UK energy supplies are seriously overstretched.
We have got away with it so far, but surely the energy policy of a major economy should not rely on ‘getting away with it’. With more cold weather forecast, the energy crunch is now with us, he was quoted as saying by the Times newspaper.
In view of the mounting concern over the issue, Alan Johnson, the minister for trade and industry, told an emergency session in the House of Commons that the likelihood of gas interruptions to industrial users and other key consumers such as hospitals were exaggerated.
The present situation does not threaten domestic or the vast majority of commercial and industrial supply, he told MPs.
The National Grid has not issued another balancing alert, but wholesale prices remain inflated. Reuters reports one UK energy broker as saying that prices for the April contract round are up by around 60%.