The UK will rely on imports for up to 70% of its gas needs by 2020, the Chief Executive of Centrica plc, Sam Laidlaw warned today.

Mr Laidlaw told an international energy conference that investment in UK energy generation has almost ground to a halt because of political uncertainty.

He told the CERAWeek Global Gas Plenary in Houston, Texas the UK's dependency on gas means that over time, shale gas has the potential to make a significant contribution to the UK's future energy mix. But as yet, that potential remains unproven and many challenges must be addressed

He also said suppliers' futures would depend on their ability to help customers take control of their own energy use through innovation.


Sam Laidlaw highlighted increasing political intervention in the energy market such as Labour's planned price freeze, a potential inquiry into competition and talk of breaking up an already fragmented industry.

He said: "Political uncertainty is the enemy of investment. As a result, investment in new UK generating capacity has virtually ground to a halt."

Mr Laidlaw used his speech to warn politicians security of supply risks becoming the "forgotten priority" of European energy policy. In the UK, an estimated 3.7 Gigawatts of coal-fired generating capacity will be shut down by the end of 2015 as a result of European directives to curb emissions. The country's reserve capacity is forecast to shrink to 4%, increasing the risk of power cuts. Yet no new capacity is being built.

Mr Laidlaw said: "In primary energy, the UK's production of gas is falling rapidly. North Sea oil and gas output has fallen by 38 per cent over the last three years. By 2020 we will be reliant on imports to meet 70 per cent of the country's gas needs. So when it comes to security of supply, there is a pressing need for solutions."

(CD/JP)