Grid hits back at critics over cuts to gas imports through UK ports

THE boss of National Grid has defended a decision to turn away shipments of gas from British ports despite the energy crisis.

The FTSE 100 owner of Britain’s main gas transmission network last week cut the amount of liquefied natural gas (LNG) it is accepting at Milford Haven terminals in Wales amid fears of oversupply.

Shipments of gas have been arriving in larger volumes than usual, often in order for it to be piped to Europe, which is racing to replace Russian gas supplies but has limited capacity to turn LNG back into gaseous form.

John Pettigrew, chief executive, argued that Britain’s pipes are running as hard as they can. He said about 60m cubic meters per day were being piped out to Europe, the maximum possible.

Meanwhile, demand in the UK is also relatively low given warmer weather and there’s “only so much you can insert” into the system. “It’s a physics problem more than anything,” he said. “As demand increases in the UK, you can take on more gas through the LNG side.”

The Daily Telegraph last week reported criticism from energy companies, who argue the restrictions will undermine efforts to supply Europe and could push energy prices even higher.

National Grid is in the process of selling most of its stake in the gas transmission business to Macquarie, as it focuses on its electricity networks. In the UK, National Grid owns Britain’s main electricity transmission network as well as several electricity cables to and from the Continent. It has also just bought the UK’S largest electricity local distribution business, Western Power Distribution.

National Grid plans to invest about £14bn in the UK and £17bn in the US by 2026, as it overhauls its operations amid the shift to electric cars and wind turbines. Mr Pettigrew said this made the company one of the largest green investors on the FTSE 100 and called for “stable” regulation and government policy to encourage investment.

His comments came after Rishi Sunak this week urged companies to invest more to boost productivity. The Chancellor is facing growing calls to hit oil and gas producers with a windfall tax amid soaring energy prices.

Mr Pettigrew said a windfall tax would in principle be “a deterrent to investment in new technology” albeit he argued a tax was “not relevant” to the Grid as it does not produce energy.

During the year to March 31, National Grid made statutory pre-tax profits of £3.4bn, up 107pc on the year before. Underlying pre-tax profits were £3bn.