Hands sets face against ‘major’ increase in LNG imports

The UK should not significantly increase imports of liquid natural gas (LNG), despite the threat of a reduction in piped Russian supplies to Europe, Greg Hands has argued.

During an appearance on Wednesday (8 June) at the concluding session of the Welsh Affairs Committee’s inquiry into the principality’s grid capacity, the energy minister was quizzed on wider security of supply issues.

He expressed “absolute confidence” about the security of the UK’s gas supplies, around 80% of which are sourced from domestic and Norwegian North Sea reserves, adding that there is “no reason to doubt” the Scandinavian country’s continued ability to deliver.

Hands said the proportion of UK gas supplies imported in liquid form on tankers is expected to increase long term as these North Sea reserves decline, albeit within the context of a decline in overall consumption of the fuel.

He told the committee that the UK can use its Milford Haven LNG terminal capacity to bolster short-term European energy security by exporting surplus gas via the Belgian and Dutch interconnectors.

However, the UK should not increase its reliance on LNG because it is both expensive and carbon emission intensive, the minister said: “Short term, LNG enables us to assist our neighbours and increase energy security, but I wouldn’t want to see us making a big move to becoming a much bigger natural gas importer because it’s both more expensive and more polluting.”

He also said the Holistic Network Design (HND), which he revealed to the committee is due to be published before the end of this month, will include a connection for the first gigawatt of floating offshore wind generation being developed in the Celtic Sea off south Wales.

The HND is being developed by Ofgem and National Grid Electricity System Operator to outline the transmission network capacity that will be required to meet the UK’s 2030 offshore wind generation ambitions.