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1970s-style rationing as National Grid cuts off gas to factories

Posted by seumasach on January 7, 2010

Guardian

7th January, 2010

Factories in the north-west of England and east Midlands are today having their energy supplies cut off for the first time in years as the severe weather and creaking power infrastructure lead to 1970s-style rationing.

In the first tangible sign that fears over energy shortages are translating into supply disruption, the National Grid has withdrawn gas via suppliers such as British Gas from 94 industrial customers who have signed up to interruptible contracts in a bid to safeguard power to domestic homes.

The Grid, which operates the UK transmission networks for both electricity and gas, told guardian.co.uk that the gas transmission network in certain parts of the country was operating at 96% capacity and it was not possible to go beyond this.

“There are some customers in the north-west and east Midlands who have had their supplies interrupted because they are on interruptible contracts and we are facing very high demand,” said a company spokeswoman.

In addition, the Grid has issued “gas balancing alerts” – one on Monday and a second this morning – asking power firms and large industrial users to voluntarily cut back on their consumption.

But its latest instruction to suppliers will force many large industrial users, such as factories and chemical plants, to halt work or turn to alternative energy sources.

The factories could refuse to have their power withdrawn but would face financial penalties for doing so and the reduction in energy would have to come from other manufacturers. “Most of the companies concerned have their own back-up generators so they do not necessarily have to cease production,” said the Grid.

British Gas said it could not immediately confirm that it had cut off some customers in line with Grid demands but said the problems were caused by transmission overload rather than the potential shortage of supplies which have triggered a growing political row.

“If anything there is an oversupply of gas and certainly no shortage at this time. This [the current problem] is about moving it around the country,” said a spokesman.

Andrew Bainbridge, chairman of the Major Energy Users Council, said power interruptions were the last thing that struggling industry needed at this time. “I feel sorry for those companies who have taken a gamble by entering into interruptible contracts in return for lower bills. It just highlights the need for the UK to have secure supplies at the lowest possible cost which we currently don’t have.”

John Hemming, Liberal Democrat MP for Birmingham Yardley and someone who takes a keen interest in energy issues, said he had tabled a motion in the House of Commons calling for more government action to safeguard the power system. “We are on the edge when it comes to our power supplies and there is no safety margin. The government needs to take action in a variety of ways, one of which is to ensure there is sufficient gas storage in place.”

Ministers have repeatedly insisted that annual threats of power blackouts were alarmist and point out that Britain now has two new pipeline links to Norway and the continent plus a new liquefied natural gas (LNG) import system at Milford Haven in South Wales. But the UK has done little to build up its gas storage capacity in the way that has been seen in Holland and Germany.

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