Salt caverns double as UK gas stores to beat cold snaps | Business

Huge salt caverns hundreds of metres underground are being converted into vast gas stores to ensure the UK has enough energy to heat homes if another Beast from the East hits.

A little-known firm employing just 50 people has risen to become the UK’s biggest player in gas storage. Storengy, a subsidiary of French energy giant Engie, said it will complete the final five of 20 salt caverns at Stublach in Cheshire this year.

That will take its market share from around a quarter now to nearly 30%, far larger than other big players in gas storage, such as SSE.

The £500m project started in 2007 and has prompted drilling into salt layers 500m deep, adding water to turn it into brine and then painstakingly extracting that over several years to create caverns to hold gas.

Snowy scenes across UK as ‘beast from east’ hits – video

The region has a long history of salt mining, with the voids used for other purposes including records from the National Archive.

The first 10 of Storengy’s caverns were finished and operational from 2016, and it has since added five more, with a final five due for completion by December.

Catherine Gras, the company’s managing director, said: “I think we need to have gas storage because it is really important for the gas and electricity markets. Not just during events such as the Beast from the East, though that was a good example.

“We have more and more renewables, the electricity market is more unpredictable. The backup is the gas. We need flexible assets.”

Gras said there “was a market to do more” storage, but she could not justify the investment because of the high costs, in particular business rates. The tax on property makes up around half of all costs the firm incurs, she said.

Energy intensive industries and unions have lobbied the government to support more gas storage following last year’s cold spring weather, which forced National Grid to warn the UK of a gas shortfall.

MPs are also investigating whether the UK has enough storage after the country’s biggest facility, accounting for about three-quarters of gas stores, closed due to ageing infrastructure. Centrica’s Rough gas store off the coast of Yorkshire closed in 2017.

The government has rebuffed previous calls to support new gas storage, saying the fact supplies did not run out last winter showed the market was working.

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But Gras said she was frustrated by that approach to storage and the government risked being complacent. “They tend to think because gas has worked for decades it will go on working,” she said.

That was no longer guaranteed because so much storage had been closed, Gras added.

The government said: “Over the past 10 years, analysis undertaken by the government and others has delivered a consistent message: that our gas system is secure, with GB supplies able to meet gas demand even under severe weather conditions for an extended period of time.”

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