Inside the floating 80s relic that wants to be Britain’s energy future

NORTH SEA, U.K. — Twenty miles off the Yorkshire coast, organized into a vast L-shape in the North Sea, is the U.K.’s biggest offshore gas storage facility.

You can reach it only by helicopter — and not at all when the weather is bad. Its three platforms, each fixed to the seabed, stretch over hundreds of meters and are navigated via narrow walkways. Grates expose the stormy waters below.

This is Rough, managed by the energy giant Centrica, the company which owns British Gas. The rig is four decades old, already running around 15 years beyond its planned sell-by-date. What happens to it next gets to the heart of the U.K.’s sweeping climate ambitions.

The British government has promised to remove gas almost entirely from the British power grid by 2030, swapping in green electricity sources like wind and solar. That means assets like Rough, which have been serving the U.K.’s dirtier energy needs since the days of Margaret Thatcher, have started to resemble relics from a fast-disappearing age — even if its owners spy a chance at rebirth.

“This platform’s served its purpose,” admitted Martin Scargill, managing director of Centrica Storage.

The company reckons it has a solution: A multi-billion pound pivot from gas to hydrogen, shifting from storing a planet-polluting fossil fuel to a source of clean energy.

But their plan is not without controversy among climate experts. And it all hinges on major help from politicians in Westminster.

A North Sea safety net

For now, Rough is still where the U.K. tries to stave off the threat each winter of fuel shortages and blackouts.

Called on for emergency supplies when all other energy sources are running short, it is gas stored under the sea at Rough — originating in the U.K., Europe and elsewhere in the world — that keeps the lights on in homes across the country.

“We’ve got a massive sponge underneath the seabed,” explained Scargill. “You can pump it up to enormously high pressures … and the gas will sit there under very high pressure. You can hold an awful lot of gas volume in that rock structure. And it’s a field that’s never been replicated in terms of its ability to store.” 

Then-Prime Minister Rishi Sunak and his Energy Secretary Claire Coutinho visited before the U.K.’s election wiped out the Tories. Kwasi Kwarteng, when he was energy secretary, came to see it, too. Current PM Keir Starmer was supposed to chopper in earlier this year — but his plans were scuppered by poor weather. 

Starmer, for all his green ambitions, still sees a role for gas in the energy mix. The 2030 plan will keep approximately five percent gas as a reserve in case of crises.

The whole issue has had added urgency since Russia weaponized oil and gas supplies in 2022. 

Rough, denied government subsidies by then Prime Minister Theresa May in 2017, wound down to become a distribution hub, with plans to restore storage capacity in an emergency. When Putin delivered that emergency, Kwarteng scrambled to negotiate Rough’s partial reopening and claw back U.K. energy security.

That storage is now at 40 percent. Rough is home to 54 billion cubic feet of gas, equivalent to about six days’ use in the U.K. At its 1990s peak, it stored over 150 billion cubic feet.

“Depending on how much you think you’re going to use in a day, [the U.K. has] somewhere between nine and 12 days [of gas storage]. And Rough provides half of that at its current capacity,” Scargill said.

This pales in comparison to elsewhere in Europe. Germany has 89 days of gas available. France has 103 and the Netherlands 123. 

Pitching for hydrogen

But U.K. demand for gas — and gas storage — is set to dwindle. The licenses for operating and storing gas at Rough expire in 2030.

The company’s big pitch now is to tear Rough down and replace it with a £2 billion hydrogen storage facility — this time storing hydrogen beneath the seabed, converting that back to electricity when demand requires.

It is quite the move: A fossil fuel firm, in the headlines recently over sky-high pay deals and the behavior of contractors while families struggle with rocketing bills, recasting itself as part of the U.K.’s green future.

Some climate experts are highly skeptical about the plans.

“Hydrogen should not be playing a major role in the U.K.’s energy future,” said Joshua Emden, senior research fellow at the IPPR think tank. “It is notoriously difficult to store and transport, leaks frequently, and unless it comes from surplus renewable electricity [so-called green hydrogen], no other methods of hydrogen production are truly low-carbon.”

Centrica cannot commit to using Rough for green hydrogen, at least not at first. But bosses insist hydrogen, whatever its source, is essential for cutting emissions from heavy industries like chemical production, a chunk of which is close by in the North Sea. Those sectors will struggle to electrify operations because of the sheer levels of heat and energy they use.

“You would have probably flown over the industrial parks, the chemical parks,” said Centrica boss Chris O’Shea in an interview after POLITICO’s visit. “That’s like 25 percent of the U.K.’s industrial emissions, and that can be decarbonized by using hydrogen,” he said. 

Ineligible

Long-duration hydrogen storage will play a crucial “niche” (if not central) role in the future energy system this way, according to MPs on one influential committee in the U.K. parliament. Another committee warned ministers more directly earlier this year: “The U.K. came to regret and partially reverse the closure of the Rough gas storage facility. … The government should be planning now for how this storage will be replaced.”

Ministers, meanwhile, are reviewing potential hydrogen projects for public funding — but ruled Rough ineligible because of the energy security risks of taking a major gas storage plant offline too quickly.

Centrica is lobbying government to take a longer view.

“The worry is that government just does things to get to clean power 2030 and uses all [its] budget for that,” Scargill said. “We all get to 2030. Great job. Well done.”

But then an even bigger challenge looms, he argued. “Shit! What about the other 70 percent of the energy system?”

The hydrogen switch would create construction jobs, Centrica claims, mostly onshore, replacing current two-week shifts on bunk beds in Rough’s air-pressured compartments.

And the work would be a whole lot less dangerous. “You can always tell a driller,” said O’Shea, “because they never have 10 fingers.”

Knocking on Whitehall’s door

Centrica insists it doesn’t want direct public cash, and will fund the upgrade from its own coffers. (It has £4 billion available for U.K. green investment, bosses say.) 

But they are demanding assurances from ministers first.

The firm wants a cap-and-floor mechanism, something already being proposed for battery storage firms. That would use taxpayer cash to guarantee long-term revenues to the firm, with any excess paid to the Treasury down the line.

The idea is viewed dimly by some Whitehall-watchers. “Most analysts regard hydrogen as a risky bet,” said Andy Mayer, an energy expert at free market think tank the Institute of Economic Affairs.

The Department for Energy Security and Net Zero would only say that more details about backing hydrogen storage will be released “in due course.” “Hydrogen will play an important role in our mission to become a clean energy superpower,” the department said.

But Centrica has already given engineering experts Wood Group a design contract to redevelop Rough. City analysts Jefferies reckon that, to keep shareholders sweet, “we expect the management to provide further clarity on capital allocation policy at full-year results in Feb. 2025.”

O’Shea, meanwhile, is in full lobbying mode. The country “runs a real risk” by emphasizing wind and solar power, he warned on his personal LinkedIn this summer.

“I do think it’s right that the wind and solar play the predominant part in this. I think that the more wind you can get, the more solar you can get — good!” he later told POLITICO. 

“But solar clearly doesn’t come at night, and so you’ve got to find a way. How do you store that electricity?”