National Grid has issued a gas balancing alert in the wake of continuing high demand for gas because of the cold snap and problems affecting some Norwegian production.
National Grid said that following today's alert extra supplies of gas materialised mainly from the liquefied natural gas (LNG) importation terminal on the Isle of Grain in Kent, via the gas interconnector with Belgium and through the Langeled pipeline from Norway.

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1. The gas balancing alert issued yesterday afternoon by the National Grid is interesting in that this is the second time that the mechanism has been used. While this is not a time for unduly raising concerns and fears that the ‘lights will be going off’ any time soon, it is certainly indicative of an ongoing trend whereby we are witnessing fluctuations in demand. As we face up to the prospect of more extremes of temperature, coupled with the fact that a number of generating stations are coming to the ‘end-of-life’, we will see increased pressure on fossil fuel prices and could eventually still see demand outstripping supply.

   However, the rollout of smart metering and smart grids will introduce a brand-new method of responding to this challenge. Smart Meters will create an infrastructure that will provide energy suppliers with the opportunity to innovate their supply and service propositions for consumers by providing new competitive tariffs and prices suited to consumer lifestyle. This in combination with consumers having the ability to act on their energy costs and consume it more intelligently, will ultimately enable both consumers and their suppliers to actively manage demand to match available supply.

   Critically, in this smart world, things like a gas balancing alert will no longer be even the slightest cause for concern, as we’ll have the long-term solutions in place to just deal with it via our flexible, low-carbon energy infrastructure.
   

   David Socha Business Development Director, Utilities, Logica | 05 January 2010, 04:34 PM

2. Any excuse not to reduce prices of domestic gas and electricity. Many old and poor will die during this prolonged cold spell. People who either cannot afford to heat their homes or are just too frightened to put their heating on despite freezing temperatures. Prices of both electricity and gas should be reduced immediately by the big six utility suppliers. The only winners out of this very cold winter are the six main suppliers. EDF owned by the French and nPower and E.ON owned by the Germans. These companies together with British Gas, Scottish Power and Southern Electric will all be announcing record profits in due course as they refuse to reduce prices despite a massive drop in wholesale prices and very sadly their record profits will be matched by a record number of old people dying from hypothermia and other cold related illnesses. Now that is the real story of this cold spell and the scandal of the decade: Meanwhile the Government and Ofgem continue to do nothing.

   Simon Icke | 07 January 2010, 05:06 PM

3. In this case I would say National Grid has acted to keep prices down. Interruptible contracts are generally a cheaper way of managing a peak in gas demand than buying extra gas just at the time prices are spiking.
   Often people argue - I think rightly - that we should have more demand side management of both gas and electricity as it's cheaper and more flexible. But it is interesting to see how when it happens it can be twisted to become a story on "gas rationing". And anyone concerned about those headlines should be reassured: we have plenty of gas.

   Janet Wood | 08 January 2010, 04:18 PM