Published: 20 September 2023

Energy Hub – Powered by GET – September 2023


Monthly electricity stats

In August, 47% of electricity came from zero carbon sources, peaking at 88% on 19 August at 10am. Gas was our largest source of fuel, with 35.1% of electricity being generated by gas. Wind was our second largest contributor to electricity at 23.5%. Peak demand was at 5:30pm on 31 August and, throughout the month, 20TWh of electricity was run through the network, enough to power 34 billion irons.


Today’s temperatures are around three degrees above SNT. They are due to drop for the next couple of days and then come back up to above SNT from the 24th. The wind generation in the UK has picked up and is expected to remain high for the next couple of days, it is expected to fall again on Thursday before falling below seasonal average on Friday. The higher wind generation should see demand for gas for power fall as wind generation will increase. Temperatures in the UK remain well above seasonal average, forecasts have the temperature falling below the seasonal average from Thursday through to Sunday before picking up again and remaining above seasonal for the rest of the month and into mid-October.


European gas storage is sitting very healthy for this time of the year, currently showing at 95% capacity. This has sent very positive signals to the market and helped keep prices at their current levels. We talked last month about the possible opportunity with additional storage in Ukraine. European traders are now utilising Ukrainian gas storage with more than 1.8 Bcm of foreign gas currently stored at sites in Ukraine as a result of spare capacity and favourable economics.

In the UK we are increasing the volumes in Rough gas storage, last year when this facility was brought back online we injected just over 450mcm by mid-November, currently it’s showing as 61% full at 935mcm. Clearly this is good news for the UK as this gives us additional capacity to fall back on. We still have very low levels of storage, as we mainly rely on the north sea, daily demand in winter can go up to 400mcm/day.


It’s been a bumpy couple of weeks for LNG, with the ongoing issues at the Chevron facility in Australia and last week a big drop in output at Freeport, the second largest liquefaction facility in the United States. Prices have bounced up to 3.23p/kWh from 2.72p/kWh the week before and have now settled back down to 2.88p/kWh after Freeport has returned to nearly full power. Freeport is key to the UK and Europe as this facility supplies 80% of the LNG coming over to us.

Workers for Chevron in Australia have stepped up their industrial action that began last week and plan further escalations in coming weeks if no agreement can be made. The trade unions and the U.S. company are expected to hold talks early this week, mediated by the Fair Work Commission, but expressed doubt the labour dispute could be resolved during these talks. No change in the situation for the better is likely at least until September 22, when a labour market regulator will hear the dispute after Chevron reached out to it in an effort to force the workers to settle. The supermajor is seeking to get a so-called “intractable bargaining” declaration from the Fair Work Commission, meaning the FWC could force workers to agree to terms proposed by Chevron. Despite the industrial action and the fault at the Wheatstone facility, LNG exports out of Australia remain unaffected. This facility accounts for 5% of global LNG capacity.


Britain has now installed more wind capacity than any other type of power generation, according to new figures. The nation’s fleet of wind farms grew to 27.9 GW of capacity over the summer, overtaking combined cycle gas power stations for the first time. The latest Drax Electric Insights report said Britain is only the fifth country in the world to have achieved the milestone. The wind capacity is split equally between onshore (14.1 GW) and offshore (13.8 GW) farms. Gas had been Britain’s largest source of power capacity for the last 10 years, and before that coal reigned supreme since the Victorian era. Dr Iain Staffell of Imperial College London, lead author of the report, said: “Wind power is blowing away gas and coal from Britain’s energy mix and in just a decade, we’ve gone from relying completely on the polluting fuels of the past to embracing the clean energy technologies of the future.”

Renewable energy sources are expected to generate more than 50% of Germany’s electricity this year, Economy Minister Robert Habeck said at a conference in Berlin on Monday. However, the minister from the Green party who is also responsible for climate action, warned that Europe’s biggest economy needs to accelerate the rollout of green energy to meet its climate targets to 2030 and beyond. By 2030, Germany aims to have renewables account for 80% of its electricity generation, Habeck said. Earlier this year, Germany ditched nuclear energy after taking its last three nuclear power plants offline in April ending more than six decades of commercial nuclear energy use. Germany, like many other EU countries, is betting on renewables to boost its energy security without Russian gas.

Geopolitical drives

The Government has eased an effective ban on new onshore wind farms in England to see off a threatened rebellion by Conservative MPs. Changes to planning rules are aimed at making it easier and quicker for onshore wind farms to be built. A group of 25 Tory MPs, including former COP26 president Sir Alok Sharma, had been leading calls for the move through an amendment to the Energy Bill. The measures include broadening the ways that suitable locations can be identified, including by communities, and speeding up the process of allocating sites by giving alternatives to the local plan process. This will ensure the whole community has a say, not just a small number of objectors – paving the way for more onshore wind projects to come online where they have community support.

The EU’s liquefied natural gas imports from Russia jumped by 40% between January and July 2023 compared to the same period of 2021, before the Russian invasion of Ukraine. Unlike Russian oil, Russian gas is not banned or under sanctions in Europe. But while pipeline gas supply from Russia has slowed to a trickle, Europe has raised imports of LNG, including LNG from Russia.  The EU is now buying significantly more Russian LNG than it did before the invasion of Ukraine, with Spain and Belgium only just beaten by China as top buyers.

Spain has moved up to become the second largest buyer of Russian LNG worldwide, with Belgium close behind. The two EU members were preceded only by China, which took 20% of Russia’s LNG in the first seven months of 2023. Spain bought 18% of Russia’s total LNG exports and Belgium took 17%, according to Global Witness. Using Russian LNG prices estimated by the Centre for Research on Energy and Clean Air, Global Witness has calculated that the EU’s purchases of Russian LNG were worth $5.75 billion (5.29 billion euros) in January-July this year. “Buying Russian gas has the same impact as buying Russian oil. Both fund the war in Ukraine, and every euro means more bloodshed. While European countries decry the war, they’re putting money into Putin’s pockets,” said Jonathan Noronha-Gant, senior fossil fuel campaigner at Global Witness.

In March this year, EU Energy Commissioner Kadri Simson urged all EU member states and all companies not to sign new LNG import contracts with Russia. The European Union has managed to significantly cut its imports of Russian pipeline natural gas over the past year, but now it should stop all LNG imports from Russia.


It’s vital that we protect existing storage inventories in case of a cold period and demand spikes. A cold start to next year combined with a LNG demand increase in Asia could see European storage levels diminish, the Independent Chemical and Energy Market intelligence (Icis) has predicted levels could possibly fall to 10%. We need to carry on with the 10-15% reduction in demand, as we have done over the last 18 months, coupled with maintaining good levels of LNG imports of around 460mcm/day across Europe and the UK.

As I’ve alluded to above, Europe and the UK are now more than ever reliant on LNG, 37% of the region’s gas in 2023, compared with just 18% last year. Assuming Europe maintained a demand reduction of 15%, storage levels – which are currently at 95% of capacity – we would end winter at a more comfortable level above 40%, even factoring in a cold spell in January in both Europe and Asia, Icis estimates showed. However, a 10% average reduction in gas demand, coupled with a sharp decline in LNG imports – in the case of strong Asian imports – could see reserves decline to just 12%.

One of our biggest risks this winter would be any disruption to pipeline flows from Norway, now our region’s biggest supplier, followed by strong Asian LNG demand.

If you would like a more in-depth discussion on any of the points raised, please don’t hesitate to get in contact on 02476308830 or email on

Victor Levison.