CBI raises concerns of weak business output

CBI raises concerns of weak business output

	Published : Thu, 20 Oct 2005 19:05 By : James Rowe Print this Story

Britain would be facing a severe energy crisis, if bitterly cold winter forecasted by meteorologists proves to be true. This would see a return to three-day working weeks and companies outputs would reduce drastically.

Sir Digby Jones, director general, Confederation of British Industry (CBI) held the government responsible for not ensuring enough storage capacity for imported gas even though it had been warned about the depletion of North Sea supplies. For CBI, which is an independent lobby group which represents 240,000 businesses, energy is the primary concern. Sir Digby added: "If we have a harsh winter - and all the long-range weather forecasts are saying that we will - this economy, the fourth biggest in the world and the most successful in Europe, will see the switch thrown on business".

1973 saw the government limiting to three days each week ordering the industrial production. This was to restrict energy use and extend reserves while countering an OPEC oil embargo and industrial action initiated by coal miners'.

The Energy regulator Ofgem has also warned that some businesses could have their gas snapped off if the weather becomes severely cold. Households are not likely to be affected though, according to it.

The forecast from meteorological department that Britain might be facing its coldest spell in more than 40 years has caused concern to CBI in particular. With the economy showing no signs of recovering from slowdown, Sir Digby cautioned that ahead was "an enormously important winter".

As of now, Britain's storage capacity is 11 days compared with an average of 55 days in the rest of Europe. Sub-zero temperatures lasting up to a week or more would exhaust the reserves within a week, it is believed.

National Grid sounded optimistic when it said that though gas supplies would be lower this year compared to last demand reduction by industrial users would only be in moderate amounts. The energy supplies can continue to be sustained to domestic users even if there is a ‘Siberian winter’, which occurs once in 50 years, according to it.

Even the Department of Trade and Industry, while acknowledging the fact that the supplies from gas market would be stiffer this winter, is hoping that with new supply and storage capacity coming on stream the squeeze "should be short lived."