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UK to set out new energy supply strategy as prices soar

Published 07/03/2022, 15:28
Updated 07/03/2022, 16:55
© Reuters. British Prime Minister Boris Johnson looks on as he meets Canadian Prime Minister Justin Trudeau (not pictured) at RAF Northolt, near London, Britain, March 7, 2022. REUTERS/Henry Nicholls/Pool
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LONDON (Reuters) -Britain will set out a new energy supply strategy as the Russian invasion of Ukraine and subsequent rally in energy prices accelerate the need for new energy sources and greater self-reliance, Prime Minister Boris Johnson said on Monday.

Johnson, at a news conference alongside Canadian prime minister Justin Trudeau and Mark Rutte of the Netherlands, said the world could not simply close down the use of oil and gas from Russia but it could accelerate the transition away from it.

"We need to intensify our self reliance as a transition with more hydrocarbons, but what we also need to do is go for more nuclear and much more use of renewable energy," he said. "I'm going to be setting out an energy strategy and energy supply strategy for the country in the days ahead."

Britain only receives 4% of its gas supply from Russia but lower overall Russian supply to Europe means less could be available from Britain’s largest providers as they face tougher competition for supplies from other European providers.

"There are different dependencies in different countries, and we have to mindful of that," Johnson said. "You can't simply close down the use of oil and gas overnight, even from Russia.

"We can go fast in the UK ... what we need to do is to make sure we are all moving in the same direction ... and that we accelerate that move and I think that's what you are going to see."

The government said earlier on Monday it had asked its nuclear regulator to start the process of approving Rolls-Royce (LON:RR)'s planned small scale modular nuclear reactor, which policymakers hope will help cut dependence on fossil fuels and lower carbon emissions.

© Reuters. British Prime Minister Boris Johnson looks on as he meets Canadian Prime Minister Justin Trudeau (not pictured) at RAF Northolt, near London, Britain, March 7, 2022. REUTERS/Henry Nicholls/Pool

One benchmark for gas prices hit a record 663.84 pence per therm on Monday. The price had fallen back to 536 p/therm by 1615 GMT but this remained more than 11 times higher than this time last year.

The European Commission is also expected to this week propose new steps to cut reliance on Russia including ensuring countries fill gas storage to a minimum level before winter and accelerating the rollout of renewables, according to a draft seen by Reuters. 

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