Q4 2022: Correction: Britain’s gas demand is fallingDownload PDF
Dr Iain Staffell, Professor Richard Green, Professor Tim Green and Dr Malte Jansen – Imperial College London, Dr Malte Jansen – University of Sussex, Professor Rob Gross – UK Energy Research Centre
In last quarter’s Electric Insights, we commented on the surprising lack of a reduction in gas demand in response to high gas prices. This was based on downloading the “Gas Demand – Actual” statistics from National Grid. We incautiously assumed that this was a time series of the actual demand for gas, but on further investigation we found it is instead a series of estimated demand levels, based on a model that assumes demand responds to the weather, but not to price. British utilities have form in this area: the Electricity Pool in the 1990s used demand forecasts that explicitly prohibited any consideration of demand responding to the level of power prices. Other time series of gas quantities are available from National Grid, and these do show a noticeable response to the high prices of 2022, more in line with the experience in other European countries.
We must apologise for this oversight, and thank the reader who pointed this out.