Future of the Gas Grid

Tom Collins Excerpts

Wednesday 18th June 2025 Westminster Hall

[Josh Newbury (Cannock Chase) (Lab)]

I beg to move,

That this House has considered the future of the gas grid.

It is a pleasure to lead a Westminster Hall debate for the first time with you in the Chair, Dame Siobhain, in particular given that it is my birthday today. [Hon. Members: “Hear, hear!”] Thank you, everyone.

I thank colleagues from across the House for joining me in this important discussion about the future of Britain’s gas grid. First, I pay tribute to the men and women who work in our gas industry, from extraction and refining through to transmission and product engineers. They literally keep the lights on and our houses warm—not that we need a lot of assistance with heating in the month of June, but of course we rely on gas heating for much of the year.

[Tom Collins (Worcester) (Lab)]

I take this opportunity to wish my hon. Friend and office mate a very happy birthday. This is a very important debate, and I am grateful to him for securing it. I am looking forward to the discussion and I have much to share later, but for now I emphasise how timely the debate is as we face uncertainty in national security and a huge energy transition that will create opportunities as well as challenges.

[Josh Newbury]

I thank my hon. Friend for his intervention and I pay tribute to him for all his years of work in the gas industry and for the knowledge that he brings to the House and indeed to this debate. I look forward to hearing from him later.

Previously, I worked for the Energy and Utilities Alliance, which is a trade association primarily representing companies in the gas heating industry. Recently, however, I had a heat pump installed at home, so I will not be using gas at all in future. I am certainly not a believer in silver bullets or dominant solutions. That heat pump cost £15,000, though, and the installation was fraught with complications, so it is fair to say that I have mixed views in this space.

Gas is an essential part of our energy system, accounting for 40% of the UK’s total energy consumption and about a third of total electricity generation. Crucially, it provides vital flexibility to make up for peaks and troughs in generation from renewables, which should of course be our focus—but they cannot be the whole solution for the foreseeable future. Indeed, the Government’s clean power by 2030 mission foresees a role for gas power stations as flexible generation for up to 5% of demand, but it will take a huge amount of energy storage to enable us to reduce our gas usage for power generation even to that level.

Looking ahead, the National Infrastructure Commission and the Climate Change Committee have recognised that gas, in one form or another, will continue to play a vital role in the energy system for decades to come, as a crucial component of a diverse and secure energy supply. All realistic projections for the UK’s energy transition envisage a continued role for gas, alongside carbon capture and storage and hydrogen, which I will come on to.

A key area of interest to me—and, I am sure, to every Member wishing to contribute to this debate—is the role of gas in domestic heating. Nationally, the gas grid serves more than 24 million homes and half a million businesses. It carries three times more energy than the electricity grid does annually and, on peak winter days, that figure rises to five times as much. Eighty-three per cent of homes rely on mains gas, and in my Cannock Chase constituency 95% of households are on the gas grid. Meanwhile, 6,460 households in my towns and villages live in fuel poverty.

Given that gas heating is clearly the cheapest form of domestic heating we have today, the future of the gas grid is not just a technical issue, but a cost of living issue. Heat pumps are a potential solution for many homes, in particular those off the gas grid, but we have to be honest about the persistent cost barriers. With the average heat pump installation coming in at about £13,000 and only just over half of that paid for by the £7,500 boiler upgrade scheme, heat pumps are clearly still the preserve of able-to-pay households and niche house builders.

--- Later in debate ---

[Tom Collins (Worcester) (Lab)]

It is a pleasure to serve under your chairship, Dame Siobhain. What better birthday present could my hon. Friend the Member for Cannock Chase (Josh Newbury) have than debating such a crucial and timely topic? I anticipate that perhaps, as he blows out the candles on his cake, as someone who cares deeply about the energy transition, he might wish for something remarkably similar to a clean and green national gas network.

Electrification is inevitably going to be a go-to tool for decarbonising many parts of our economy, but it is equally clear that it cannot do everything. First, gas can do things that electricity cannot. Industry needs it: around half a million businesses in the UK currently rely on gas for their operations, and around 30% of those say that electrification is simply not feasible for them, technically or economically. Those businesses are spread across our nation, not just in clusters, so a national gas system is the only way for UK industry to not only survive but thrive.

Secondly, our national security depends on us having a multi-vector energy system. The UK has always ensured that homes, businesses and critical infrastructure have multiple energy sources available, typically electricity and either gas or oil fuels. As the world becomes increasingly uncertain and dangerous, now is not the time to roll back on the essential principles of security and resilience.

Thirdly, as we face the challenge of rapidly delivering an energy transition, gas provides us with vital flexibility and optionality, which means that we can make it over the finish line in our target time. Industry, transport and heat are all transitioning with uncertainty about the final mix of technologies. Government can secure the successful transition not by picking technologies to win or lose but by specifying a clear set of core energy vectors for the transition and investing in their core infrastructure. I put on record that those might be, for example, electricity, hydrogen and ammonia.

As a case in point, my hon. Friend mentioned that his installation of a heat pump was fairly typical, costing around £15,000. My discussions with industry indicate that the installation of a hybrid heating system, even a new one, would typically come in at under £7,000—a significant difference in the up-front cost, which is a major barrier for homeowners. Alongside that, installation times are shorter, and homeowners avoid the need to install hot water storage tanks or replace radiators.

Industry has already indicated that it will be ready, in four years, to make all its boilers 100% hydrogen-ready. It also indicated to a previous Secretary of State that it would provide price equivalence with the products in existence then. I recognise that the Climate Change Committee has tried to move us along by suggesting that there is no role for gas in the future of heat, but as someone who spent my entire career trying to decarbonise heat, I would humbly say that, although that guidance was well intended, it might be misguided.

Even as electricity remains our primary energy vector, reliable energy generation depends on large-scale energy storage, and that means gas. A system that can produce, store and utilise clean gas is vital for electrification to be successful. Although gas is seen as cheap and dirty today, it does not have to remain so tomorrow. Its versatility means that it will be a valuable resource in the future. While forecasts are for the cost of clean gas to reduce dramatically in the future, its role will be one where its value is recognised, and cost parity with today is not a prerequisite for a future clean gas market.

Private capital has successfully been released to deliver billions of pounds of investment into our gas networks, making them safe, fit for the future, and ready for future gases such as hydrogen and methane. More capital stands poised and ready to be invested. However, our previous Government, who should be congratulated on putting the UK in a leading position for a few years in the 2010s, then created a cloud of uncertainty that has left our gas industry in limbo.

Our mission to make the UK a clean energy superpower should be a powerful beacon that burns that uncertainty away, but it must include a tangible future role for the gas networks in our envisaged energy system. Ambition must be converted into some techno-economic goals that are clear and certain. For gas, that means committing to two things: storage and transportation. The prize is for the UK to once again lead and be an innovating leader in a new global energy outlook.

It has become dazzlingly clear from my discussions with industry that storage is a key enabler. It provides a price and a sink for producers to make clean gas, and a price and a source for users to plan their transition. It could be delivered by establishing and planning a progressive build-out of a strategic national clean energy reserve, which could utilise private capital but, crucially, be publicly commissioned, operating in the national interest for resilience and stable markets.

For those markets to develop, storage must be backed up by transportation. Fortunately, that solution already exists in our world-leading gas networks and can be completed through the delivery of a national hydrogen backbone. We could make a decision on blending now, and that would unlock those markets and allow for the large-scale production of clean gas.

The key signal to unlock all that is reassurance from the Government that the gas system, having transitioned to low-carbon gas, has a future for decades to come. That single declaration—one line that says, “We can see clean gas playing a role in the energy future of our towns and cities”—would be transformational. With it, we can ensure that the industrial economy spread across our country has a sure and hopeful future of opportunity and renewal. With it, we can ensure that the UK’s energy system is resilient, robust, secure and a source of strength, not vulnerability, in our national security. With it, we can deliver a deep and rapid energy transition through agility, partnership and UK innovation. With it, we will be on a strong pathway to making the UK a clean energy superpower.