No room for gas storage in new UK energy strategy
The new UK energy strategy paper makes no mention of introducing new gas storage following the closure of Centrica's aging Rough storage facility in 2017.
Centrica ceased gas injection and storage at the North Yorkshire facility due to safety concerns surrounding the infrastructure, which had endured past its intended lifespan. The gas field is still active, but the Competition and Markets Authority concluded that degradation of its facilities meant it was "no longer capable of safe injection operations."
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The closure left the UK with few gas storage centres. As of April 5, the national reserve held just 5 TWh in storage, a position in stark contrast to most of the UK's western European peers, notably Germany (63.8 TWh), Italy (58.2 TWh) and France (29.3 TWh). The UK, however, does produce significant amounts of indigenous gas.
Whitehall's new energy strategy sets out to support all areas of the energy transition, from legacy fuels through new offshore licensing agreements to the potential end of the moratorium on shale gas, and renewable energy plants that could further reduce CO2 emissions as the UK continues towards its 2050 carbon neutrality objective.
The government unreservedly has stated that upstream oil and gas should be seen as a core energy source for years to come, and the industry widely welcomes that stance. That makes the absence of any gas storage policy in the document all the more surprising, particularly as plans to revive Rough with the state's backing had surfaced last year.
Greg McKenna, chief executive of Centrica Storage, had said the upgrades would go ahead if the government could establish regulated revenues to generate £1.6bn ($2.1bn). He told Tees Business at the time: "It is a £1.6bn development, no one is going to spend £1.6bn if there isn't some guaranteed return.
"We are looking for some government support model – it doesn't need money to go into it. If we can get a regulated model from government, we are prepared to go ahead and convert."