Lord Turner calls for cleaner gas power plants

However, Ian Parrett, at energy analysts Inenco, said the costs of the proposal could represent a push too far, and that the Government should focus on making sure the technology was working for coal-fired plants before including gas.

"Gas-fired electricity has a lower carbon footprint than coal, so coal must be the priority. But let's make sure that the whole process is working properly first," he said.

"In the light of existing concerns about energy security and costs this could represent a step too far and too soon. We're going to need to rely on gas-fired generation for some time to come and we'll need every megawatt we can get hold of."

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UK natural gas prices continue to disconnect from oil.

The following chart from Reuters, which comes to us courtesy of Nick Campbell, an energy market consultant at Inenco

The chart shows a clear disconnection between oil prices and UK gas prices from the fourth quarter of 2008 and onward.

As Campbell explained:

Oil was the major force on the bull run seen on the winter gas price, as the market topped $147/Bbl during the Summer ’08. The gas price did subsequently fall as global risk appetite weakened and stop losses began to get hit.

As oil began to firm as we progressed through 2009, the disconnect became apparent in the Summer of 2009 as both South Hook and Dragon LNG terminals became operational. This allowed the UK to increase the flexibility of its supply portfolio and allowed it to become less reliant on European long term index linked contract gas.

This disconnect was further exacerbated by the lack of appetite from the US for LNG, which the Qatari project saw as one of its main stays. As a result the UK terminals became a prime target to pick up the slack available in the market and help ease concerns surrounding Norwegian outages, cold snaps and technical issues, which has been reflected in the disconnect.

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Fears over future power shortages

Ian Parrett, an analyst at Inenco, said: "The bottom line is that we have left it too late to bridge the generation gap that is fast approaching.

"Delays in new generating capacity and the lack of levels of investment required to bring new generating capacity on-stream have put us in this situation, with the forced shutdown of older, coal-fired generating plants now looming on the horizon. The impact that will have is very worrying."

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UK energy policy - has it run out of steam?

But the alternative, refusing to admit that change is needed, will inevitably lead to "blackout Britain", according to Ian Parrett, from energy experts Inenco, with industry and homes facing regular power cuts as early as 2012.

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Gas Supplies Running Out As Britian Shivers

Ian Parrett, of energy analysts Inenco, warned that the country was in danger of being held to ransom over gas prices and blamed a lack of investment in storage plants.

“We’re faced with a shortfall of supply created by a combination of the cold weather and the number of people returning to work and putting the heating back on putting extra demand on the system,” he said. “Some big companies on interruptible gas contracts risk a reduction or cessation of their supply.”

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Industry warned of cuts in gas supplies

Ian Parrett, of energy analysts Inenco, said Britain urgently needed more gas storage. “Since 1990 the need for imports has increased significantly whilst storage has lagged behind, highlighting the growing discrepancy in energy security,” he said.

“Worryingly, the recent economic downturn has seen several proposed new UK gas storage facilities shelved.”

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Profits surge 80% at Centrica's domestic arm

Nick Campbell, of energy analyst Inenco, said customers should be looking for cuts to their bills of about 10% as demand dropped in the recession causing the biggest energy glut in 20 years.

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Storm over environment minister who doubts climate change 10.02.09

Energy industry analysts warned that the Northern Ireland minister's skeptical views were "shared by many people", but suggested the debate prompted by the banning of the adverts would allow the evidence to be presented.

Inenco, one of the country's largest energy analysts, said the work to cut down on climate change emissions would also bring the benefit of "a much higher degree of energy security".

Ian Parrett, of Inenco, commented: "The target to meet an 80% reduction in emissions by 2050 means a complete reassessment of how we produce and consume both energy and goods. Success will only come when people work together."

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Inenco takes lead on green industry

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Britain 'will be immune' to gas shortages in Russian row 08.01.09

Ian Parrett of Inenco, the UK's largest energy analyst, said: "We are not experiencing supply shortfalls in the UK but the markets are already responding.

"With future dependence on imported gas, Britain needs to make energy security a key priority or risk being held to ransom. Direct Government investment is vital if the country is to meet this growing challenge."

Inenco has reported jumps in the "forward" and "spot" prices of gas of 10% and 20% respectively today, because of uncertainty about future supplies.

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Britain 'immune' from gas shortages 07.01.09

Ian Parrett of Inenco, the UK's largest energy analyst, said: "We are not experiencing supply shortfalls in the UK but the markets are already responding.

"With future dependence on imported gas, Britain needs to make energy security a key priority or risk being held to ransom. Direct Government investment is vital if the country is to meet this growing challenge."

Inenco has reported jumps in the "forward" and "spot" prices of gas of 10% and 20% respectively today, because of uncertainty about future supplies.

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New call for immediate cut in energy prices 07.01.09

Ian Parrett of St Annes-based energy analysts, Inenco, which five years ago called for a Government inquiry into fuel price tariffs, said: "The current issues in the gas supply market highlights the concern we have over the reliability of supply.

"We wouldn't expect to see prices dropping markedly in this time of uncertainty.

"There is still a perception the 'Big Six' energy companies are not as competitive as they could be and there does seem to be scope for further reductions without placing the risk factor of a fixed price onto customers."

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