Energy and Climate Change Committee Calls To Increase Gas Storage
The UK must increase current amounts of gas storage to reduce the impact of energy price spikes, as part of efforts to secure supplies and keep the lights on, MPs have urged.
A report by the Commons Energy and Climate Change Committee warned that the UK can only store 14 days of gas supply, compared to France's 87 days and Germany's 69 days of supplies, and should double storage capacity by 2020.
The committee criticised the Government for making an "opportunistic raid" on UK continental shelf oil and gas producers with a £2 billion levy in the 2011 Budget, warning such actions could damage investor confidence in home-grown fossil fuel production.
However, the report on energy security said decreasing supplies from UK offshore oil and gas fields would not threaten the UK, as long as the Government has a strategy for ensuring diverse sources of power that does not rely too much on fossil fuels from unstable parts of the world or one technology at home.
The report said new electricity generation currently planned or being built would fill the looming "gap" in the power system as ageing plants close up to 2018.
But the MPs called for more efforts to promote greater energy efficiency in order to reduce demand, and warned the Government against relying on power companies to deliver the message on saving energy as consumers did not trust them.
They also warned of problems in juggling energy security with policies to cut climate emissions and keep energy affordable.
For example, cutting emissions from electricity generation could lead to issues with a lack of gas storage, the need to deliver technology which captures carbon, and a greater reliance on intermittent renewables, which could push up consumer bills.
Greater energy efficiency will be "vital" not only for improving energy security, but for reducing the impact of expected rises in consumer bills, the report said.
Tim Yeo, chairman of the committee, said: "The UK will become more dependent on energy imports as North Sea oil and gas declines but prudent planning can ensure this doesn't reduce our energy security too drastically."