Related Articles
Andy Brogan, EY Oil & Gas global sector leader
Forward article link
Share PDF with colleagues

Gas-to-power facing socio-economic challenges

Vested interest opposition to wider natural gas use for electricity generation discussed as Petroleum Economist holds its first Gas to Power forum in London

Using natural gas to generate electricity as the world transitions away from coal will likely create socio-economic challenges beyond the cost, technological and environmental pressures that it already faces, attendees heard at Tuesday's inaugural Gas to Power Forum in London.

Powerful coal mining unions in Germany and eastern Europe, south Asia and southern Africa, as well as the challenge of replacing hundreds of thousands of jobs created by the industry, will present politicians with some tough decisions, experts told the forum in London.

This will pose headwinds despite the evidence that converting natural gas into power presents the fastest, cleanest and most reliable route towards governments meeting carbon emissions goals.

"It is a huge issue, for example in countries such as India that have a significant domestic coal industry. If governments try to get gas—imported gas—to compete, they face vested interests, balance of payments issues and other challenges," Andy Brogan, EY global oil and gas leader, said at the forum.

"People can be very protective of their industries," Jane Rangel, gas analyst at Energy Aspects, said at the event, noting that opposition from certain sectors of society to embrace more environmentally friendly policies that had adverse side-effects to their interests was equally important not just in emerging economies but also in western European countries such as Germany and France. "This is despite considerable wider public appetite for benefits such as cleaner air."

"On the one hand, events are going to drive the transition, whether these are political events or climate related. On the other, there are social consequences that have not been thought through—and these will be a constraint that will lead to different resolutions in different countries," said Tom Burke, chairman of the environmental think tank E3G.

Victor Perez, partner and energy sector leader at EY, told the forum that "coal is proving much more resilient than we expected even just a few years ago".

The Gas to Power Forum was supported by EY as Knowledge Partner, Winston & Strawn LLP as Legal Partner, Standard Chartered Bank as Finance Partner, and Energean Oil & Gas as Coffee Break Sponsor.

A diverse audience of industry experts heard insights on the biggest trends shaping the future of LNG-to-power and gas-to-power projects, such as the evolution of large project financing, the spot LNG trading picture and the China demand story.

The panellists also addressed how easy is it to match gas supply and power demand requirements, and whether managing any asymmetry was a key factor in a successful gas-to-power project.


Also in this section
The great gas investment divide
24 November 2020
Gas’ part in the transition to a climate-neutral energy system is more controversial than for any other major source of primary energy
China’s refining recovery looks set to stall
19 November 2020
Crude oil throughput at refineries broke records in October, but the market will not fully get back on track until next year
Outlooks diverge for German LNG projects
18 November 2020
RWE remains bullish on Brunsbuettel while Uniper rethinks Wilhelmshaven