Ben Brading 5 min read

Natural Gas Distribution in Britain

Britain’s natural gas distribution network consists of over 300,000 km of gas pipelines that transport gas from extraction in the North Sea to businesses and homes across the country.

This guide provides an overview of how gas distribution works in Britain. We cover:

Key parts of British gas infrastructure
Parties involved in British natural gas distribution
Gas distribution costs

Key parts of British gas infrastructure

In this section, we explain each element of the British gas infrastructure, starting with how natural gas reaches mainland Britain.

Natural gas sources and imports

Natural gas arrives in Britain from the following three main sources:

Natural gas extraction in the North Sea.
Liquified natural gas imports from South Wales and South East England regasification facilities.
Undersea interconnecting pipelines with the European continent.

Each source is directly connected to the National Transmission System for gas.

National Transmission System (NTS)

The National Transmission System is a high-pressure pipeline network that transports gas from the above sources to the regional gas distribution networks.

The NTS consists of approximately 8,000 km of pipeline and 21 compressor stations. The transported gas is kept at a pressure of 94 bar (40 times the pressure of a car tyre). A series of turbines push the compressed gas through the network.

The NTS delivers gas directly to regional gas distribution networks, as well as to gas power stations and some industrial manufacturing facilities.

Gas distribution networks

The National Transmission System delivers natural gas to five regional gas distribution grids:

Scotland: Operated by SGN
North of England: Operated by Northern Gas Networks
London, West Midlands, and East of England: Operated by Cadent
South of England: Operated by SGN
Wales and South West England: Operated by Wales & West Utilities

The regional gas distribution networks are low-pressure gas pipelines that supply natural gas to individual homes and businesses in the area.

The gas distribution operators are responsible for new business gas connections in their area.

Regional gas distribution networks also connect to smaller private gas distribution networks called independent gas transporters.

Parties involved in British natural gas distribution

In this section, we’ll summarise the different organisations involved in distributing natural gas in Britain.

Gas transmission operator

National Gas is the gas transmission operator for the British mainland, which owns and operates the NTS.

In addition to ensuring the efficient flow of natural gas through the NTS, National Gas is responsible for:

Balancing supply and demand – Ensuring sufficient gas in the NTS meets consumer needs by balancing imports into the network with consumption.
Network emergency coordinator – Protecting the country by responding to network emergency scenarios.

Macquarie Asset Management and the BCI Management Corporation, both global asset managers own National Gas.

💡 Until September 2024, National Gas was partially owned by National Grid Plc (which owns the national grid for electricity).

Gas distribution operators

Gas distribution operators are responsible for the reliable transportation of gas from the NTS to end users within their regional networks.

Key aspects of the role of gas distribution operators include:

Leak detection, repairs and responding to emergencies.
Arranging new business gas connections.
Installing domestic and business gas meters.
Facilitating network upgrades and expansion.

Gas shippers

Gas shippers play an important intermediary role in the distribution of natural gas in Britain.

Gas shippers are responsible for buying and selling natural gas in the wholesale market, arranging its transport through the NTS and relevant regional gas distribution networks, and then selling it to suppliers.

Gas shippers utilise gas storage capacity within the British gas network to deliver the required quantities of gas to where it is needed by users.

Gas shippers are licensed by Ofgem. The complete list of gas shippers in Britain is published on the Ofgem website.

Gas suppliers

Ofgem licenses domestic and business gas suppliers to sell natural gas to individual properties in Britain.

Gas suppliers coordinate the transportation of gas through the NTS and regional gas distribution networks by working with gas shippers.

Gas distribution costs

Gas distribution costs contribute approximately one pence per kWh to the overall business gas rates.

Business gas suppliers are charged for moving gas through the NTS and regional gas distribution networks, and these costs are passed on to customers in domestic and business gas bills.

Gas distribution networks are natural monopolies, so Ofgem, the industry regulator, carefully regulates the rates they charge.

Here’s a summary of how gas distribution costs work:

National gas transmission costs

National Gas, the operator of the National Transmission System, charges for using the network in pence per kWh per day, depending on the entry and exit point of the NTS.

National Gas fees are adjusted annually and are published on the charges page of their website.

Regional gas distribution costs

Each gas distribution operator publishes their distribution charges annually on their website.

Regional gas distribution costs are made of two components:

Daily standing charges: To guarantee the capacity of a business gas connection on the network, measured in pence per peak day capacity (kWh).
Distribution charge: A charge per kWh of gas transported through the local network, depending on the location of the business gas connection within the local network.