Commission sees ongoing role for gas
The European Commission expects gas to be in the long-term energy mix, albeit in different ways to today
Gas continues to have a role in the European energy mix, Benedikt Klauser, the Commission's policy officer for energy told the European Autumn Gas Conference (EAGC) in Paris on Wednesday. But its use as a baseload fuel for heat and/or power with no curbs on its carbon emissions may be numbered.
Gas can play a part as a “facilitator of renewable energy sources” and as a “flexible source of energy storage”, says Klauser. But “if gas is to remain in the energy mix to 2050 and beyond, it will have to be successfully decarbonised”, he continues.
One element in carbon-neutral gas is an expanded biogas sector. But carbon capture, utilisation and storage (CCUS) also has a key role to play. “Russia [and] Norway may have an interest with continuing to supply us with decarbonised gas using CCUS,” says Klauser.
CCUS is also high on the agenda of oil and gas producers. The technology is now “absolutely recognised” as a central part of achieving Intergovernmental panel on climate change (IPCC), International Energy Agency (IEA), and Commission climate objectives, says Francois-Regis Mouton, EU affairs director at the International association of oil and gas producers (IOGC), which represents 90pc of European oil and gas production.
CCUS is no longer theoretical in Europe, as there are currently 18 existing and planned projects across Europe and “more will come through 2020”, says Mouton. But development of the technology will require regulatory support at European level, he continues, adding it shouldn’t be exclusively down to oil and gas companies to drive the change.
IOGC presented a number of CCUS policy recommendations at the recent Madrid Forum—which gathers EU gas sector stakeholders—including enabling gas grid operators to transport CO2 as part of their regulated activities; rewarding CO2 transport by ship, train or truck as part of the EU ETS scheme; and promoting a market framework for goods and services produced with CCS, including guarantees of origin.
The EU is “on track to reach 2020 objectives” but will require a faster transition to cleaner energy sources if it is to meet Paris Agreement targets, says Klauser. And this changing market environment is going to require massive investments, he continues, citing estimates that the energy transition might require as much as €200bn annually.
Adapting European gas and power regulatory environment that was formulated in a world of mainly ‘vanilla’ methane and predictable thermal generation is another challenge. There is a “range of [new] policies that will have to be addressed in the coming years” at EU level, says Klauser, including the “fragmented approach to gas quality” and “the question of what a correct regulatory design for hydrogen should be”.
The Commission is currently conducting studies to identify remaining barriers to deployment of renewable and low carbon gases—e.g. ‘green’ and ‘blue’ hydrogen—which will inform future policy proposals at European level.