Minister says gas use may still be 25% of current level in 2050

The UK could still be using as much as a quarter of the gas that it does today in 2050, a junior energy minister has said.

Lord Callanan made his remark as the House of Lords approved new regulations allowing power stations retrofitted with carbon capture and storage (CCS) technology to be eligible for Contracts for Difference-style arrangements on Tuesday (17 May).

The business and energy minister told the House of Lords that while the UK is due to achieve a 40% cut in its gas consumption by 2030, it would continue to provide an important source of energy during the transition to net zero emissions.

He said: “In meeting net zero by 2050 we may still use a quarter of the gas that we use now.”

The Climate Change Committee has said in its sixth carbon budget advice that no unabated gas should be used for generating power from 2035 onwards.

However, Lord Callanan said hydrogen must be developed to provide an alternative to natural gas.

The changes to the CfD regulations, approved by the House of Lords this week, amend the rules that define the generators eligible for the low-carbon subsidy contracts.

The change widens the criteria to enable retrofitted CCS plants to be eligible for the dispatchable power agreement, which is based on the standard terms of the CfD, and has been developed to provide a subsidy mechanism for carbon capture projects.

Lord Callanan said the changes to the CfD regulations would “alternative” payment mechanisms, which do not use the terms “strike” and “reference” price.

The updated regulations also allow plants, which use carbon not transported by pipelines, to be eligible for subsidy support.

Lord Callanan said this would help to bring forward the “significant volumes” of generation capacity, which will be required to meet growing electricity demand and operate for extended periods of subdued renewable output.