Warning as energy prices rise 65%

London — First quarter industrial gas and electricity prices averaged , respectively, 65% and 50% higher than in the same period last year, the Government’s latest Quarterly Energy Prices report shows.

According to the Chemical Industries Association, the latest energy price trends highlight the importance of ensuring adequate UK gas supplies this winter. In particular, the group wants to maximise supply through the Isle of Grain LNG importation terminal and via pipelines from Belgium, The Netherlands and Norway.

The latest cost hikes further underline “the benefit of Ofgem and the DTI continuing to work with the EU Commission to ensure that UK consumers can have access to the same contractual terms as their European competitors,” a CIA statement added.

Long term there is an “ever more apparent need” for a large expansion in UK strategic gas storage to help balance seasonal variations in demand, according to Steve Elliott, CIA chief executive.

“Uncompetitive energy prices are undermining the viability of many chemical sites as it is now impossible for companies to contract ahead at prices which allow their business to avoid losses,” said the CIA leader.

“Our members’ ability to trade and invest is assisted by predictable and competitive pricing. Right now wholesale gas market prices in the UK offer neither of these fundamental requirements,” Elliot concluded.