Britain’s gas market is broken

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Precisely how much the energy-supply crisis will cost taxpayers depends on how many firms fail, how soon and how high gas prices go

. They are painful for many countries, but particularly so for Britain. For a decade its government has permitted upstart suppliers to capture a significant slice of the retail gas and electricity market with business models that left them ill-prepared to weather market turbulence.

Such me-too operations were always vulnerable to a demand squeeze. But the risks rose in 2017 with the closure of a storage facility owned by Centrica, a utility firm, at Rough off the North Yorkshire coast. That left Britain able to store just 2% of its annual demand for gas. Other big gas importers, by contrast, can store 20-30%. And they rose further in 2019, when the government responded to continued grumbles about high energy bills by setting a consumer-price cap.

Some energy-intensive businesses found themselves thrust into a no-day week. CF Industries, an American-owned fertiliser company, recently ceased production at its two British sites, saying it was no longer economic. The effects rippled through the food-supply chain. One of the by-products of fertiliser production is carbon dioxide which is used to stun animals before slaughter, to package fresh food and to create the dry ice used to keep food cool during transport.

 

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The UK a fail state? It's the beginning of...

And who broke it? YES, green policy!

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