Big U.K. Energy Users Want Urgent Measures to Ease Crisis

(Bloomberg) -- The U.K. government must roll out emergency measures quickly to help industrial energy users cope with the gas crisis, or face business shutting down this winter, a lobby group warned.

Europe’s gas crunch has hit sectors from fertilizers to metals, and there’ll likely be production halts and disruption to supply chains without government action, the Energy Intensive Users Group said Tuesday. It urged the U.K. to use emergency measures, including containing costs on gas, power and carbon prices to allow the most exposed companies to keep producing essential goods.

Gas markets have tightened just as cold weather starts in the Northern Hemisphere. Britain in particular is feeling the blow because it lacks large storage facilities and relies heavily on imports of the fuel, causing power costs in the country to surge.

“We have already seen the impact of the truly astronomical increases in energy costs on production in the fertilizer and steel sectors,” EIUG Chair Richard Leese said in a statement. “Nobody wants to see a repeat in other industries this winter given that U.K. energy intensive industries produce so many essential domestic and industrial products and are intrinsically linked with many supply chains.”

Other measures the EIUG is calling for:

• Replicate network tariff discounts given to industries in the European Union.
• Take steps to ensure sufficient gas is available.
• Reduce “priority site” threshold from 50 million pounds to 1 million pounds.
• End policies such as the carbon price support.

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