Written evidence to be reported to the House
Energy Bill
12:00 pm
Alistair Buchanan: I am happy to start by picking up the point raised by the Minister with regard to comparisons with Europe. Certainly, at the wholesale end of the market, we have seen a very exciting development in the last three to four years, particularly in gas infrastructure. We have seen 21 companies from around the world invest £10 billion in our liquefied natural gas storage pipeline infrastructure, thereby taking the UK from around 105 BCMs of demand and 105 BCMs of supply to potentially 180 BCMs of supply by the end of this year. With regard to Europe, we still see profound delays in the development of some of their LNG facilities, such as in Wilhelmshaven in Germany and Rotterdam in the Netherlands.
Perhaps what matters more to consumers is what is happening in prices and in terms of choice. With regard to choice, the experience of the UK—I would expand this comparison beyond Europe—is that about 50 per cent. of customers have taken the opportunity to choose their supplier. We are clearly very keen to access the 50 per cent. who have not. By contrast, in Germany that figure has been about 4.5 per cent. The best country to compare us with would be Spain, which has hit levels of around 20 per cent. of choice, and the Nordic region, which has around 10 to 15 per cent. There is genuinely no other country that provides the degree of choice or has encouraged and led customers to feel confident enough to choose. As far as price is concerned, on domestic gas prices today, we remain among the lowest of the 27 member states, and on electricity prices, we are around the average.
To answer your question, Minister, with regard to investment coming into the UK, domestic choice and prices and industrial benefits, which for the decade between 1994 and 2004 were extraordinary by contrast to European industrial counterparts, we think that the market works and has been very good for the UK.