National Grid PLC says energy supply can meet UK demand this winter

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UK wholesale gas prices continue to soar and more suppliers are expected to go out of business

National Grid PLC (LSE: NG.) Said it has enough capacity to meet UK electricity demand this winter.

The supplier said the country would need 49.4 billion cubic meters of gas this winter, which is lower than the 50.7 to 53.3 billion cubic meters seen in recent years.

READ: National Grid says new UK-Norway power cable provides ‘secure’ power supply

The report comes as UK wholesale gas prices continue to soar, hitting £ 3 per therm this week – a 500% increase since the start of the year.

Wholesale gas prices continue to rise as the reopening of global economies has resulted in increased demand that exceeds supply.

Nine UK energy providers covering 1.7 million customers have closed since September, with more expected in the coming months.

“European natural gas prices are also increasing by more than 20%, also to a record high. Britain has been hit hardest by the crisis with around 40% of its energy coming from gas. There is a major imbalance in the market, with some describing it as the global commodities financial crisis, ”said Victoria Scholar, chief investment officer at Interactive Investor.

“Expectations of a cold winter ahead, low investment in alternative fossil fuels, and unusually low levels of wind power to power renewable turbines are all adding to the pressure.”

Meanwhile, Cornwall Insight analysts estimate next year’s price cap could reach £ 1,660, or 30% from current level. Ofgem is due to update the price cap next April.

“With supplier exits since early August already in double digits, the prospect of new claims – and additional costs to consumers – is evident, although it is not clear when those costs will hit invoices,” said the senior consultant Dr Craig Lowrey.

“Although historically relatively small amounts in terms of impact on invoices, the extent and frequency of vendor exits may push the normal approach to cost recovery into uncharted territory and have unknown impacts on an already stressed retail supply industry. “

“The explosion of choice and innovation seen in the industry over the past decade by supplier challengers has been fundamentally altered in a matter of months, and while all eyes will inevitably be on this winter, the need to a lasting solution to ensure that the gains experienced by nearly three decades of competition are not lost.

National Grid shares were flat at 903.7p Thursday afternoon.


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