Centrica, owner of British Gas, has warned it may close the Rough gas storage facility off the coast of East Yorkshire in April 2027 unless the UK government intervenes. The Rough site, Britain's largest gas storage hub, currently provides around half of the country’s total natural gas storage capacity, enough to fuel the energy grid for up to six days. Centrica’s chief executive, Chris O’Shea, stated that the production licence for Rough will expire at the end of April and the company does not plan to seek an extension, citing economic reasons. The facility is expected to be nearly depleted by this winter.
Rough was first shut down in 2017 when the government declined to support its continued operation but was partially reopened in 2022 amid the energy crisis triggered by Russia’s invasion of Ukraine. Since then, Centrica has been producing remnant gas while lobbying for government-backed investment to redevelop Rough into a larger capacity gas and hydrogen storage facility. The company seeks a long-term financial framework, such as a regulated “cap and floor” system, that would guarantee minimum revenues to justify a potential £2 billion expansion.
O’Shea emphasized that the decision to close Rough is not simply a commercial one for Centrica but a matter of national energy security. He argued that the facility could help reduce the UK's exposure to volatile international gas markets and support hydrogen storage development, while potentially creating thousands of skilled jobs during construction. However, Centrica said it would only consider renewing the licence or investing further if the government steps in or if gas prices spike to extreme levels similar to those experienced in 2022.
The warning comes amid growing concerns about the UK’s future gas supply amid declining North Sea production and reliance on imports. Gas still accounted for about 35% of the UK’s total energy demand in 2024, mainly for domestic heating, underscoring the ongoing need for secure storage and supply options. The government’s energy department has highlighted risks associated with potential infrastructure failures, including import terminals or key pipelines, which could lead to supply shortfalls during extreme cold periods.
The UK government is expected to publish an interim response to its “gas system in transition” review soon, which will address issues such as storage capacity, import infrastructure, and domestic production policy. Meanwhile, the energy secretary faces pressing decisions on near-term measures, including whether to support filling Rough for the upcoming winter. Some energy analysts suggest alternative storage solutions, like onshore salt caverns, expansion of interconnectors with continental Europe, or additional liquefied natural gas (LNG) import terminals, could play roles in enhancing supply security.
In parallel with the storage issues, Centrica announced plans to cut 1,300 jobs, primarily by replacing customer service roles with digital solutions such as artificial intelligence-driven chatbots. The company reported an 18% decline in half-year profits, affected by asset disposals within its Spirit Energy business and challenging market conditions. Chief executive Chris O’Shea noted the company is undergoing a technology-led transformation aimed at cost reduction and improved customer service efficiency, reflecting changes in how customers manage their accounts predominantly online.
As the UK energy sector navigates these intertwined challenges, the choices made in the coming months regarding Rough and broader energy infrastructure will shape the country’s energy security landscape into the next decade.