Energy: Gas Storage

Baroness Worthington Excerpts

Thursday 28th November 2013 Lords Chamber

Asked by

[Baroness Worthington]

To ask Her Majesty’s Government what assessment they have made of the adequacy of the United Kingdom’s gas storage and its effect on consumer and business energy prices.

[The Parliamentary Under-Secretary of State, Department of Energy and Climate Change (Baroness Verma) (Con)]

My Lords, four new storage facilities are either in operation or will soon become operational, which will increase the capacity of our gas storage by over 20%. In addition, they will nearly double the rate at which storage can deliver gas into the gas system, and there are further projects in the pipeline beyond those. DECC has considered whether incentivising storage would bring wider price benefits and we have concluded that the evidence for benefit is not sufficient to justify that, as potentially it would put great costs on to the consumer.

[Baroness Worthington (Lab)]

My Lords, we have seen quite an extraordinary amount of flip-flopping from the Government about when it is appropriate to intervene in markets and when it is not. However, there is still no desire to stand up to the energy companies. It is true that in the UK our gas storage is at very low levels—less than a quarter of that in France and Germany. Will the Minister comment on whether she believes that to help address the cost of living crisis, the Government should now ensure investment in gas storage so that we can avoid the seasonal price spikes that come with increased demand every winter?

[Baroness Verma]

My Lords, I think that I have already stated to the noble Baroness that we have gas storage either in the pipeline or coming on line. We also have a robust and dependable gas interconnection through pipelines from Norway and the rest of Europe. Therefore the noble Baroness, who raised this point about the cost of living to consumers, should have thought about it during the 13 years her party was in government.