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The energy regulator has warned the UK is facing a “significant risk” of gas shortages this winter.

The information, which was revealed in a letter sent from Ofgem last week and first revealed by The Times, spoke of the possibility of “gas supply emergency” measures to help preserve stocks due to the impact of Russia’s war in Ukraine which has starved Europe of its main source of natural gas.

A gas supply emergency can be declared when suppliers are unable to safely get gas to homes and businesses.

It could mean that some customers, starting with the largest industrial consumers, will be asked to stop using gas for a temporary period.

The aim would be to keep gas and gas-generated electricity supplies stable for households for as long as possible.

The stark warning emerged as energy bills come under the protection of government caps, shielding both households and businesses from the worst in the wholesale price surge ahead of winter.

An Ofgem spokesperson told Sky News: “This winter is likely to be more challenging than previous ones due to the Russian disruption of gas supplies to Europe.

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“Britain is in a good position with little direct import of gas from Russia; our own domestic gas production; reliable supplies from Norway; and the second-largest port capacity in Europe to import liquified gas.

“Nevertheless, we need to be prepared for all scenarios this winter.

“As a result, Ofgem is putting in place sensible contingency measures with National Grid ESO (electricity system operator) and GSO (gas system operator) as well as the government to ensure that the UK energy system is fully prepared for this winter.”

The regulator spoke up just days before National Grid was due to give an update to its winter outlook for spare power capacity.

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It had said at the end of July that it expected supply to be tight but did not expect the lights to go out despite the Europe-wide battle to secure supplies.

Commenting on the situation, senior analyst at the Energy and Climate Intelligence Unit Jess Ralston said: “The UK electricity system has been built to rely on gas to balance the peaks and troughs of supply and demand, but this reliance could now prove problematic if prices spike further and supplies run low.

“With proposed decoupling of gas and renewables prices, wind and solar power will drive down bills and investment in batteries and other storage like pumped hydro will increasingly perform this balancing act.”

A separate report on Monday justified nerves over the approaching winter months.

The International Energy Agency (IEA) warned of “unprecedented risks”, adding that prolonged cold snaps would place supplies at particular risk.

Its quarterly report found that European Union countries would need to reduce use by 13% over the course of the winter months in case of a complete Russian cut-off.

Supplies from Russia – which accounted for 40% of the bloc’s natural gas needs ahead of the war – are currently only running at a tiny fraction of usual capacity.

The EU has accused Moscow of weaponising supplies by turning off the taps on the main Nord Stream 1 pipeline.

Nord Stream 1 and the yet to come on stream Nord Stream 2 pipeline have since been ruptured, with blasts caused by sabotage said to have caused gas inside the pipes to leak out.

The supply crisis has seen businesses on the continent, particularly Germany, cut back on natural gas use as prices soar.

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£4.7bn spent on EU border checks but some costs ‘unnecessary’ and timetable unclear, says new National Audit Office report




£4.7bn spent on EU border checks but some costs 'unnecessary' and timetable unclear, says new National Audit Office report

Traders are facing increased costs and more paperwork due to Brexit border controls, according to a new report from the independent public spending watchdog.

The government is estimated to have spent £4.7bn so far but some of that spending was not necessary, the National Audit Office (NAO) has said.

Despite the UK voting to leave the European Union in 2016 – and officially exiting in 2020 – many border control checks are yet to be implemented.

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It is “not clear” when the checks will be fully in place, said Parliament’s spending authority in its trade border report, and there is no timetable for government to achieve its “world’s most effective border” target.

This lack of certainty, as well as “repeated delays” in bringing in import controls, resulted in spending on infrastructure and staff that was “ultimately not needed”, according to the NAO.

Those delays and the associated uncertainty have also impacted businesses by adding extra cost and admin burdens, the watchdog added.

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Late policy announcements have reduced the ability of businesses and ports to prepare for changes, the report said.

After five delays, the first phase of border barriers – requiring additional certification – came into force on 31 January this year, with a second phase having started on 30 April when physical checks were introduced at ports.

A third phase, requiring safety and security declarations, is scheduled for 31 October. These phases are partial import controls.

‘Increased biosecurity risk’

The UK is at “increased biosecurity risk” due to the phased implementation approach and having lost access to EU surveillance and alert systems after Brexit, the NAO said.

There is reduced awareness of “impending dangers”, such as African Swine Fever, it added.

Customs declaration work borne by businesses had been estimated to cost organisations a collective £7.5bn, according to HM Revenue and Customs (HMRC) figures in 2019, which the NAO notes has not been updated despite 39m customs declarations being made on goods moving between Britain and the EU in 2022.

The government’s £4.7bn figure is an estimate of post-Brexit border management and does not factor in the full, eventual cost.

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Strategy ‘lacks clear timetable’

It has not specified when a full regime will be in place but said it intends to introduce most of the remaining import controls during 2024.

The NAO said the 2025 UK border strategy “lacks a clear timetable” and cross-government delivery plan, with individual departments leading and implementing different parts.

It added that annual reports on progress will not be published until 2025 “at the earliest”, despite the government saying in its border strategy in 2020 that it would publish yearly progress reports.

The NAO recommended full border controls operate at all ports “as soon as possible”.

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Online fashion giant Shein approaches Sajid Javid ahead of blockbuster IPO




Online fashion giant Shein approaches Sajid Javid ahead of blockbuster IPO

Sajid Javid, the former chancellor of the exchequer, has been approached about taking a role at Shein, the online fashion giant which is progressing plans for London’s biggest stock market float for years.

Sky News has learnt that Mr Javid is among a number of senior City figures who have held talks with Donald Tang, Shein’s executive chairman, in recent weeks.

City sources said that if the appointment of Mr Javid proceeded, it could see him either join Shein’s board or become an adviser to the Chinese-founded company.

They added that Baroness Fairhead, the former BBC Trust chair, was also on a list of candidates drawn up by headhunters advising Shein.

One person close to the company said the identities of those being approached reflected both the seriousness with which Shein was taking the issue of corporate governance and the extent of its focus on a London listing.

Since leaving the government, Mr Javid has taken a role with Centricus, an investment firm which tried unsuccessfully to structure an offer for Chelsea Football Club in 2022.

A spokesman for him, who had insisted that Mr Javid would stand for re-election in his Bromsgrove seat a week before publicly announcing the opposite, did not respond to a request for comment from Sky News.

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In recent weeks, several reports have repeated Sky News’ revelation that Shein has turned its attention to a London flotation amid difficulties in securing approval from US regulators.

An initial public offering would be likely to value Shein at around £50bn or more.

Paris is also understood to have been considered by the company as a possible listing venue.

Earlier this year, Jeremy Hunt, the chancellor, held talks with Donald Tang, Shein’s executive chairman, to persuade the company to commit to what would be one of London’s biggest-ever corporate flotations.

The meeting between Mr Hunt and Mr Tang underlined the importance that British officials are attaching to the idea of trumping the US in an effort to land the Shein IPO.

If it proceeded, Shein could become the London Stock Exchange’s second-largest IPO in history, behind the 2011 stock market debut of Glencore International, the commodities trading and mining group.

Mr Tang has also met executives from the LSE as well as more junior ministers as part of its IPO preparations.

Shein filed documents for a New York listing last year, but has grown concerned that its application may be rejected by the US Securities and Exchange Commission.

Goldman Sachs, JP Morgan and Morgan Stanley are advising on the deal.

Based in Singapore, Shein has become one of the world’s largest online fashion retailers, although its growth has not been untroubled amid mounting concerns about labour standards.

Last year, Sky News revealed that Shein was in talks to buy the British fashion brand Missguided from Mike Ashley’s Frasers Group.

While the transaction itself was worth only a modest sum, retail analysts said that it could pave the way for Shein to build a more meaningful profile in the UK, potentially through a broader collaboration with Frasers.

Founded in China in 2012, Shein was valued at over $100bn last year, at which point it was worth more than H&M and Zara’s parent company, Inditex, combined.

The company’s valuation was slashed to $66bn as part of a share sale last year.

Shein operates in more than 150 countries.

It has also struck an agreement with SPARC Group, a joint venture between the Ted Baker-owner ABG and Simon Property Group, a US shopping mall operator.

Under that deal, SPARC’s Forever 21 fashion brand gained distribution on the Shein platform, which boasts 150m users globally.

Shein acquired a one-third stake in SPARC Group, while SPARC Group also took an undisclosed minority interest in Shein.

The LSE’s efforts to court Shein come during a challenging period for the City as a listing venue for large multinationals, with ARM Holdings, the UK-based chip designer, opting to float in New York rather than London.

Other companies, such as the gambling operator Flutter Entertainment and drug company Indivior, are planning to shift their primary listings to the US, citing higher valuations and more liquid markets.

In recent weeks, however, London has landed the prospective IPOs of Raspberry Pi, the personal computer maker, and AOTI, a medical technology provider.

Mr Hunt last week hosted a summit at Dorneywood attended by technology companies looking at listing in the UK.

Shein declined to comment.

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Record profits at Ryanair after costs rise – but ticket price cuts could be on the way




Record profits at Ryanair after costs rise - but ticket price cuts could be on the way

Ryanair has reported another year of record profits and passenger numbers.

The average fare at the airline, which is Europe’s largest by passenger numbers, was 21% more expensive than 12 months earlier, its annual results showed.

But the company suggested a cut in ticket prices could be on the way after this summer when prices will either be the same or more expensive than last year.

Annual profits reached €1.92bn (£1.64bn), surpassing the previous record of €1.45bn (£1.26bn) made in the year ending March 2018.

Passenger numbers also outpaced previous all-time highs and are now well above pre-pandemic numbers at 184 million – a rise of 23% on the pre-COVID year of 2019.

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Ticket prices

Those passengers paid fares costing an average of 21% more than the year up to March 2023 but Ryanair’s chief executive Michael O’Leary said if the company has to cut fares to have planes 94% full next April, May and June “then so be it”.

While demand is “strong” for summer flights and its summer schedule will operate over 200 new routes, the low-cost carrier said it remained “cautiously optimistic that peak summer 2024 fares will be flat to modestly ahead of last summer”.

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Boeing headwinds

The passenger increase has come despite Boeing‘s delays in delivering new planes to the airline.

Ryanair had staked a large part of its financial success on expansion through 300 new 737 MAX 10 aircraft.

But the plane manufacturer has been beset by delays amid regulatory and media scrutiny of safety at its manufacturing sites after a door blew off an Alaska Airlines Boeing 737 MAX 9 jet.

There’s a risk those delays “could slip further”, Mr O’Leary said.

But Ryanair said it would receive “modest compensation” from Boeing for the delays.

The no-frills carrier also said its fuel bill rose 32% to €5.14bn (£4.4bn).

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