UK energy minister accuses CBI of winter 'scaremongering': report

London (Platts)--26Oct2005

UK energy minister Malcolm Wicks has accused Digby Jones, head of
business organization CBI, of talking "nonsense" and "scaremongering" with his
comments that there could be major energy shortages this winter, sending the
country back to the three-day week of the 1970s, according to a report in the
Financial Times Wednesday. The paper said that in an interview with the
minister, he "made little effort to hide his irritation at the CBI."
     The UK Met Office had warned this winter looked to be colder than
average, but said it had a one-in-three chance of being wrong on that. UK
beach supplies of gas are lower this year than last, but this year there will
be the new Humbly Grove gas storage facility from Nov 4, an expanded
UK-Belgium Interconnector and the Isle of Grain liquefied natural gas terminal
to bring in additional supplies. 
     The minister argues new infrastructure investments showed the UK market
was working. "This is a picture of a dynamic UK energy sector responding to
the new UK energy scenario, working in collaboration with strategic partners
in Norway and elsewhere," he said in a statement Wednesday on the occasion of
the visit of Norwegian energy minister Odd Roger Enoksen to the UK. "New
pipelines, terminals and storage facilities mean greater security of supply
and will help bear down on prices for industrial and domestic consumers."
     The energy industry seems to agree there is no threat to the supplies of
domestic users this winter, although there are concerns that some businesses
could face interruptions if it is very cold. Those businesses may have agreed
on "interruptible" supply contracts that give their suppliers the right to cut
them off under the condition of a supply constraint. For many years,
businesses have enjoyed cheap gas prices on such contracts without ever
suffering much interruption.

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