![]() That fragile system faces further challenges in the years ahead, with most of the UK’s nuclear power plants, which supply up to 20% of electricity, to close by the end of the decade. Less than 1% of Europe’s stored gas is held by the UK.īritain has been forced to temporarily fire up coal power stations, paying millions of pounds to the likes of Drax in North Yorkshire, to plug some of this power shortfall. Yet despite the obvious reliance on fossil fuels for electricity, homes and in heavy industry, the UK has some of the lowest amounts of gas storage capabilities in Europe, leaving the market uniquely exposed to the supply crunch. The UK also relies heavily on gas for home heating and cooking. Around half of the UK’s electricity is generated by burning fossil fuel in gas-fired power plants, a trend which has become more deeply entrenched over recent months after a string of problems in the UK electricity system.Īgeing nuclear power plants have been forced to undertake unplanned outages for maintenance, a main power cable used to import electricity from France has shut down after a fire, and the UK’s wind turbines have slowed during some of the least windy months since 1961. The global gas crunch is particularly bad news for the UK. ![]() Nord Stream 2 has faced US sanctions and provoked concern that the EU would increase its reliance on energy imports from Russia. ![]() The company has met its contractual obligations for gas delivery over recent months but Gazprom has come under fierce criticism for appearing to send little extra to help meet the enormous demand in Europe.ĮU lawmakers have called on the European Commission to investigate whether the company’s behaviour has been designed to keep market prices high, and put pressure on regulators to approve of its controversial plans to build the Nord Stream 2 pipeline, a major gas line which would double its capacity to send gas to Germany via the Baltic Sea. On Monday gas prices across Europe surged by another 10% after Russia’s state-backed gas company, Gazprom, refused to increase its exports to Europe – despite record-high prices across the continent. Russian gas gamesĪs shipments of gas have turned from Europe towards China, flows of pipeline gas to Europe from Russia have failed to make up the shortfall. To satisfy its record demand for gas, China’s imports of gas via super-chilled tankers was expected to surge by almost a fifth, meaning fewer shipments travelling to Europe from countries such as Qatar. Market experts at S&P Global Platts said earlier this year that China’s demand for gas was likely to rise to 360 billion cubic metres (Bcm) this year, up 8.4% from an estimated 332 Bcm in 2020. In the last month alone, prices have climbed by 70%. Gas prices in the UK have more than quadrupled over the last year to highs of 180 pence per therm, from around 40p/th this time last year. In 2021 its post-Covid economic ramp-up has coincided with an uptick in demand across Asia and Europe too.Īs economies begin to recover from the fallout of the pandemic, countries across the northern hemisphere, which experienced a long, cold winter in 2020-21 that depleted gas storage levels, have been left scrabbling to secure supplies. China’s appetite for energy is always a key driver of global market prices.
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