National Gas Warns of Increased Risk of Supply Failures Following Ofgem's Spending Cuts

National Gas, Britain's national gas pipeline operator, has expressed concerns about increased risks of supply failures and blackouts due to the energy regulator Ofgem's proposed spending cuts. The regulator proposed cutting National Gas's baseline spending by nearly 40% to £2.5 billion, which National Gas believes will "see network risk increase very significantly" and "increase the likelihood of more frequent and longer unplanned interruptions." National Gas wants to spend at least £4 billion maintaining and running the network over the five years from April 2026 to March 2031.

Key Takeaways:

• National Gas has warned of increased risks of supply failures and blackouts due to Ofgem's proposed spending cuts, which would see network risk increase very significantly.
• The regulator's proposals would jeopardise National Gas's ability to comply with regulations, including cybersecurity standards, and may lead to unplanned interruptions, network constraints, and safety risks.
• Many of National Gas's pipes are classified as critical national infrastructure, and a failure on any one of them could impact over 500,000 customers.
• The proposed spending cuts would be detrimental to National Gas's ability to maintain and upgrade its systems, including its IT and cybersecurity systems.
• National Gas believes its proposed spending plans would mean an increase in the annual levy on household energy bills of less than £2 to £10 a year.

Statistics:

• £4 billion: National Gas's proposed spending plans for maintaining and running the network over the five years from April 2026 to March 2031.
• £2.5 billion: Ofgem's proposed baseline spending for National Gas, a 40% cut from the previous spending plan.
• £15 billion: Initial spending approved by Ofgem across all the gas networks in its draft determinations.
• £9 billion: Minimum spending approved by Ofgem in electricity transmission in its draft determinations.
• £104: The estimated increase in energy bills by 2031 due to the approved spending plans.
• 5,000 miles: The length of high-pressure gas transmission pipes owned by National Gas.
• 30: The number of gas-fired power plants supplied by National Gas.
• 24 million: The number of homes supplied by the regional gas distribution networks.

Sources:

• National Gas press release, date not provided (referred to as "National Gas 2023" in the original text, without a specific date)
• Ofgem draft determinations, July 2023 (exact date not provided in the original text)

* "Ofgem's draft determinations" in The Times

* "Draft determinations in July" in The Times