UK government urges planners to consider need for gas storage

UK government urges planners to consider need for gas storage

London (Platts)--16May2006

UK Trade and Industry Secretary Alistair Darling has put before
parliament a "statement of need" urging the construction of new natural gas
storage facilities to help the UK meet peak winter demand, the government said
Tuesday.
The government hopes that the statement will help to speed up the
decision making process for developers proposing new gas storage facilities.
Several recent projects have been hit by severe delays in the planning
process.
E.ON UK's Byley, Cheshire gas storage site was rejected by the local
council and by a planning inquiry and only got approval after Deputy Prime
Minister John Prescott overturned the planning inquiry. Canatxx's Fleetwood,
Lancashire project first applied for planning permission at the end of 2003,
but the company is still stuck in a planning inquiry. Star Energy applied to
build a site at Welton in Lincolnshire at the end of 2003, but only got an
answer from the local council in February 2006. The storage project at Welton
was rejected and Star may now appeal.
"Ten significant new gas storage projects are presently coming forward,"
said Darling. "If they all go ahead on time we could see our storage capacity
more than doubling by 2010 ... The statement of need will help these
developers make their case more effectively."
The government is not ordering local authorities to accept new gas
storage. But it hopes the statement can be used as a weighty piece of evidence
in local debates.
"Most of all it should be seen by local authority planners, in particular
in the limited number of areas suitable for gas storage, as a material
consideration of considerable weight, leaving them in no doubt that the
decisions they make are critical to our national energy security," Darling
said.
Last year Star Energy started up a new gas storage site at Humbly Grove
in Hampshire. The only new space that can be built in time for winter 2006 is
an extra 15 million cubic meters of storage capacity at EDF Trading's Hole
House site in Cheshire: a tiny amount. But experts say storage will be
needed not just this winter, but in growing amounts over coming years as the
UK's indigenous gas reserves decline and it becomes reliant on imports. At the
moment the UK can store about 4 or 5% of annual demand, while some other
European countries - admittedly with less gas production - can store around 20
to 25%.
The importance of building new storage has been highlighted this year by
an ongoing outage at Centrica Storage's Rough gas storage site, which closed
after a fire February 16. Rough makes up three quarters of the UK's 3 billion
cubic meters storage capacity. Many think the UK would be more secure if it
had a wider range of storage facilities. In addition to the fire this year,
Rough suffered a withdrawal outage during a peak demand period in 2004 and was
damaged in a collision with a fishing boat in 2002.

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