British gas demand in winter 2024/25 to be flat on last winter: NGT

Gas demand in Great Britain this winter is expected to be flat on weather-corrected demand from the previous winter at some 39 Bcm, gas grid operator National Gas Transmission (NGT) said Oct. 8.

In its annual winter outlook, NGT said it expected an increase in residential gas demand in the period October 2024-March 2025, but a fall in gas demand from the power sector.

"We expect that the coming winter will look very much like the previous winter as supply and demand patterns return to more normal levels," it said.

Non-daily metered demand, which is made up of gas demand from homes, shops and offices, is forecast to rise by around 2% year on year to 27.4 Bcm.

This, NGT said, is based on the assumption that some consumers would increase their energy usage given that household energy prices are slightly lower than last winter.

But despite the lower prices, household energy prices are still high by historical standards. "So we would expect many of the energy saving techniques to continue limiting the increase in demand," NGT said.

Wholesale gas prices remain relatively high. Platts, part of S&P Global Commodity Insights, assessed the NBP month-ahead price on Oct. 7 at 101.67 p/th ($13.30/MMBtu).

NGT said daily metered and industrial demand is forecast to be comparable to the previous winter at 3.8 Bcm, while gas demand for power is forecast to be down by 5% to 7.8 Bcm, with the drop due to the continuing rise in renewables.

But it said it expected to see high maximum daily demands, as was the case last winter, with gas-fired power stations coming online to help balance the electricity system "when the wind doesn't blow".

"Gas continues to play a crucial role in our energy mix, especially during peak demand periods," it said, pointing to gas providing more than 50% of electricity between Nov. 29 and Dec. 2 last year, peaking at 61% on Nov. 30.

"This underscores the importance of gas in complementing renewable energy and ensuring a resilient power supply," it said.

Gas exports

Exports to Ireland, meanwhile, are seen at 3.5 Bcm this winter -- up from 3.0 Bcm last winter -- on expectations of an increase in gas demand for power generation in Ireland.

Exports to continental Europe, though, are forecast to be lower this year at 0.5 Bcm -- down from 1.7 Bcm last winter -- and returning to "more normal" levels post the energy crisis, NGT said.

NGT said that the stable demand forecast -- mirroring last year's levels -- coupled with diverse and flexible supply sources "positions us well to meet the nation's forecasted energy needs."

It said it expected a similar pattern of supply behavior this winter, with both the UK Continental Shelf and Norway providing steady, reliable supplies.

"Flexible supplies will predominantly be from LNG and storage, along with small levels of continental Europe imports when needed," it said.

However, it said that while Britain was in a "better place" than two years ago, it was important to remain aware of the risks, "especially as we are an import dependent country."

"We continue to closely monitor the market, and it is possible that the information and analysis underpinning this document may change as we progress through winter," it said.

NGT said factors beyond its control -- such as the weather, global market developments, and the wholesale cost of gas -- would all influence the gas supply and demand situation.

"We believe it would take a combination of events -- for example a very cold winter in the UK, coinciding with a major interruption to one of our gas supply sources -- for there to be a material risk to our energy security," it said.

"It is important to note here that we believe this to be an unlikely scenario, but the exploration and assessment of rare events such as this are an important exercise in winter preparedness."