Gas pipeline

This article was first published in May and has been updated 

It’s happened. Russia has cut off gas supplies to the Ukraine prompting the start of a ‘gas war’ months after a real, shooting war got under-way in the deeply divided state.

The news comes as EU leaders are right in the middle of haggling over the future shape of the region’s energy and climate policies and the question is what works? Fracking, biogas or simply using less energy.

A recent draft paper on energy efficiency suggested a target to cut energy use by 40% by 2030 would cut gas imports by the same amount saving 505bn Euros a year in fossil fuel costs.

What has this got to do with the Ukraine?

The EU imports around a third of its gas for heating and power from Russia, though only a portion of this travels through the Ukraine. Indeed the EU imports about 53% of the energy it consumes.

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The UK doesn’t import much gas itself (see chart) – but as North Sea supplies dwindle it may do. Because the UK buys gas from Europe any cut to EU supplies would hit the UK.

In January 2006 and 2009 Russia cut off gas supplies through the Ukraine causing a short term spike in EU gas prices. The latest Ukraine shut down pushed up gas prices again.

If Russia were to cut off gas supplies to Europe completely prices would spike as competition for the remaining gas increased.

And though Russia may sell gas no to the UK, Russia’s state owned gas company – Gazprom – does. Indeed the UK is one of its major clients according to its map – below which means UK gas purchases do send money to Russia.

So what can be done to cut our reliance on Russian gas? All the options are hard – here we go through them.

1) Import it from elsewhere

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Big ships carrying frozen gas from around the world are the current favorite for getting off Russian gas, though Russia is also keen to send it’s own ships around the place. 

The idea is plausible – but not neccesarily great. In addition to increased supply from gas producer Norway, European Liquified Natural Gas (LNG) terminals can import as much as 199 billion cubic meters of gas a year, more than we currently import from Russia.

The EU is currently working on a trade deal with the US which could pave the way for imports as well as harmonising environmental rules between the two economic blocks and Poland has called for the creation of an ‘energy union’ to ensure EU member states send gas to each other.

But there are a few reasons why this may not be a very tempting option.

It’s pricey

Imported gas from the US, Qatar or elsewhere is likely to be much more expensive than Russian gas because gas shipments face competition from Asian buyers.

Indeed some analysts suggest London gas prices would more than double if we tried to replace Russian gas entirely and even if the economics made sense US gas, at least, wouldn’t arrive in Europe for a few years.

“The Russians understand this empty threat. We have no LNG [Liquefied Natural Gas] export facilities, Ukraine has no LNG import facilities, other than that — it’s a great idea,” Edward Chow, a Senior Fellow at the Center for Strategic International Studies, told TIME.

Algeria or Russia?

The main other sources of LNG are Qatar and North Africa both of which might appear to have similar risks to gas from Russia.

As a British former energy minister commented, “Now Qatar’s a great place but it’s also near to lot of jihadists. (It is) the size of Guildford. If it was to go into chaos we would be up shit creek, we really would.”

Also, it doesn’t actually answer the question – how to reduce gas imports.

2) Burn more coal

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Coal: it’s dirty, it’s imported and it causes smog – but it’s not gas!

If importing gas from elsewhere proves tricky another option is to switch to a different fuel source altogether – coal.

The Polish Prime Minister, Donald Tusk, has called for the ‘rehabilitation’ of coal as an energy source for all of Europe, Poland, of course already sources more than 80% of it’s power from coal, it’s fair to say he is not a fan of the EU’s plan to limit coal burning with new climate targets.

But we’re already burning lots of coal 

To an extent this is already happening.

Low carbon prices and relatively high gas prices (even without relying entirely on LNG) mean that the UK, like the rest of Europe, is burning more coal for power, largely at the expense of gas.

But the scale of our current dependence on coal also makes it hard to imagine it increasing – even if we wanted to (which would be a problem if we also wanted to tackle climate change or air pollution).

Indeed in the UK coal accounted for around 36% of the power mix in 2013. In 2012 government data shows the UK’s gas plants only ran around 30% of the time – mostly during times of peak demand.

To increase coal burning further may mean closing gas plants and building new coal plants.

Not only is this illegal in the UK – without carbon capture and storage – it is also implausible in any EU country as coal plants are likely to face rising costs in future linked to the carbon emissions they produce.

Coal comes from er… Russia

Though the UK doesn’t import Russian gas, like the rest of the EU, it does import Russian coal, 45% of the coal the UK imports is of Russian origin meaning more coal burning would still send money to Moscow.

In the short term importing less coal without increasing gas imports would be tricky without opening new coal mines – potentially under the North Sea. Coincidentally UK coal has suggested it may need support to keep the UK’s mines open.

3) Frack the countryside 

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Fair trade, organic, home grown fracked gas (this is sarcastic).

Another way political leaders want to cut our dependency on Russian gas is by fracking, the problem is there is – aside from all the environmental controversies – there is little evidence this will work.

A study by energy consultants Poyry into European shale gas suggests supply will come on stream at scale in around a decade.

By 2030, the EU’s gas import dependency could be reduced by around 10-18% depending on the success of EU shale gas extraction (see Figure 31) with a similar impact on the UK alone.

Shale could meet 3-18% of demand by 2030

That means, according to the think-tank E3G that shale gas will not improve EU security of supply noting  “21 of the EU 28 Member States import gas from Russia. Even under the most optimistic scenarios, shale gas is projected to meet just 10% of European gas demand by 2030.”

“Most commentators agree that 2-3% by 2030 is a more realistic estimate,” the note added, not really enough to make much difference to our gas imports.

Russian gas is cheaper

But even if we experience a shale gas boom it may not cut our reliance on Russian gas.

Poyry note that because Russian gas is cheaper than most other gas we could import – and potentially than shale gas – we’d keep importing it in increasing amounts even if fracking took off. Here is a chart:

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The study assumes significant gas demand without new efficiency or clean energy targets to tackle climate change which, the authors say, would not be possible without subsidies (and they aren’t sure these will happen).

4) Get it from waste or poo

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Cow farts. Not as sexy as fracking, but almost as much potential – sort of. 

Indigenous gas doesn’t have to come from the ground.

A study by the National Grid  found that biogas produced from waste materials could meet between 5 -18% of the UK’s existing gas needs by 2020 – more than most predict could be met by shale gas.

In Germany big-six utility Eon is experimenting with technology which uses wind power to produce gas for injection into the grid. If either of these come through the UK’s natural gas use could be reduced to nil – eventually.

The UK’s current projects – which we’ve mapped - are relatively small scale however and, like shale, bio-gas is unlikely to be cheaper than imported gas or provide an immediate solution.

5) Use less gas

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The red bits are where heat is lost. Heat comes from gas. Gas comes from Russia. 

Because more than half of the gas we use isn’t used to generate power but is instead used to power industry and heat homes insulation and efficiency are two of the more immediate ways in which we can cut our gas use.

Over the longer term a switch away from fossil fuels, including gas and coal in the power sector, could cut also cut gas use, though this would be balanced by the impact of reducing coal use first.

Here are some serious numbers for those that want to know:

By 2020 efficiency and some renewables could cut gas imports

The UK’s energy efficiency strategy concludes that efficiency measures such as home insulation which save money over time could cut gas use by 196Twh by 2020, a 23% cut in current consumption (current gas use is 858Twh) though it is unlikely to happen without changes to the government’s flagging Green Deal energy efficiency scheme.

That means the savings in gas use achievable from efficiency roughly equal to the current level of imports from the UK’s second largest gas supplier Qatar – and any small imports from Russia.

It is also almost double projected production from the Lancashire shale at the same time (115Twh)(calculation using BP’s conversion tables) though shale output is expected to rise later.

Renewable sources of heat, including biomass and ground sourced heat pumps could save a further62Twh of gas - though this is less certain.

But cutting coal use would do the reverse

Offshore wind projects including the London Array and newer projects such as the Westermouth scheme (which uses new larger turbines to be constructed by Siemens in the UK) could supply 33-58 Twh of power according to government data.

But whilst action to tackle climate change will drive will cut gas use with clean energy and energy efficiency it will also curtail coal use, potentially increasing gas consumption in the power sector – at least for a few years.

The UK currently sources around 130Twh of power from coal. Government forecasts suggest total clean energy production will increase by around 60twh by 2020 (Figure 2 median total clean power subtracted from total clean power in DECC data).

If the UK were to close its coal plants by the same date the balance would have to come from gas.

Looking longer term it makes a big difference

A new draft analysis by the EU’s commission suggests that using of 30-35% less fuel in 2030 than projected would have a big impact.

A 25% efficiency saving target is expected to reduce EU gas imports by 9% by 2030; a 35% target would cut them by 33%; and a 40% target by 40% (the renewables target remained static for the purposes of the comparison), according to a draft figures in a European Commission analysis.

6) Switch to clean energy for heat and power

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Wind turbines like coal plants and nuclear plants don’t use gas. Handy that. 

Further development of wind energy has the potential to reduce gas use by 2030 and even more by 2050

Save £8bn a year in gas imports

A study by Cambridge Econometrics based on scenarios from the government’s independent climate advisors suggested UK gas imports would end up would be 45% lower (worth about £8bn a year)  by 2030 if the government pushed for a 65% renewable energy target by 2030 (about double the likely deployment by 2020).

That would depend, in part, on achieving falls in the cost of offshore wind envisioned by developer Dong and the Crown Estate.

Instead of new LNG terminals the UK would need new assembly facilities and – most likely – wind turbines which float as they do in Japan another country concerned about rising gas imports.

Bringing it all together a study by the National Grid found that if the UK takes steps to invest in clean energy and improve efficiency – in line with our legal commitments on tackling climate change- gas use will fall by over 40% by 2030 under their ‘gone green’ scenario.

Over the long term – by  2050 – the UK government’s climate advisers have recommended that both power and heating are gas free.

Guidance provided to Energydesk by the CCC and analysed alongside data from the Department of Energy and Climate Change and other sources suggests that means UK gas demand will by about 70% lower.

These scenarios include varying amounts of nuclear power (though the UK just cancelled Russian nuclear co-operation) and some carbon capture and storage but all would need a fundamental change in how we generate and distribute power to accommodate a large share of renewable energy.

In addition to offshore wind tidal and marine power may provide a large chunk of our power.

China is already investing in a raft as projects, in the UK the Swansea bay tidal scheme whichdevelopers claim could meet 10% of the UK’s power needs.

7) New cables (instead of pipelines)

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Instead of transporting gas around Europe, we’d need to transport power around Europe. The wind, after all, usually blows somewhere. 

Instead of building new gas pipelines we would need new, high voltage, power cables across Europe. They would both source power – such as geothermal from Iceland or onshore wind fromIreland – and allow us to provide power to other countries.

An analysis by consultants Energynautics for Greenpeace based on European weather information for 2011 and data from the International Energy Agency (IEA) suggests it is possible to get 77% of Europe’s electricity from renewable sources by 2030; through smart grids, demand management, gas backup and big changes in how our power grid works.

With Google buying smart meter firm Nest the googlification of power – using data to ensure power is used only when needed and when it is most widely available – could significantly cut gas use.

Factcheck: What is possible – and what isn’t

But there is no quick fix and we may not even need one.

Since the last Ukraine crisis then new pipelines and storage infrastructure has been built leading most analysts to conclude that anything other than a permanent cut in Ukrainian gas supplies would have relatively little impact.

As German chancellor Angela Merkel observed, Russia exported gas to Europe even during the height of the cold war.

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It’s bad, but it’s not (yet) the cold war, and the gas flowed during the cold war

Getting off Russian gas within a year or two possible – but only by importing large amounts of more expensive gas from equally unstable places and continuing to burn coal which makes it harder to avoid catastrophic climate change and contributes towards record levels of air pollution in Europe.

Indeed, given the recent political crisis over energy bills there is very little evidence to suggest consumers would be willing to pay higher prices to keep Putin at bay.

Over the next decade efficiency and biogas could reduce gas demand – though this will be balanced by increased demand for gas power as Europe looks to phase out old coal plants and the evidence suggests shale gas will play a marginal role.

Over the medium term investing in home insulation, an interconnected European power grid and clean energy would cut our dependence on fossil fuels significantly by 2030.

UK gas production from the North Sea will also fall –  but possibly by less – which means UK gas imports could decrease from current levels.

As a result an analysis by Oxford Economics suggested that the impact of fossil fuel price volatility – of the kind you get if Russia suddenly turns off the gas – would be cut by half if the power sector were decarbonised by 2030.

On a European level the European Commission recently made an assessment of the impact of various climate and energy policy options being considered by national leaders.

The study found current plans for a 40% cut in greenhouse gas emissions by 2030 would reduce gas use by 13% by 2030. Adding on targets for efficiency and renewable energy however led to a fall of 27% by 2030.

The same document concluded that ambitious climate, efficiency and clean energy policies would cut net energy imports into Europe by more than half by 2050 – though we don’t even know who will be in the Kremlin by then.

Shale gas also has the potential to play a role by 2030 but the evidence we’ve seen (neatly summed up here) suggests it would be far smaller than the impact of climate, efficiency and energy policies.

By 2030, the EU’s gas import dependency could be reduced by around 10-18% depending on the success of EU shale gas extraction. Because shale is relatively expensive to extract it won’t actually reduce Russian gas imports.

As Poyry’s shale gas expert put it “There’s nothing in that level of shale gas production that will reduce the dependence on Russia from where we are now. In fact it would still be increasing over time. What you’d need to do, instead of looking at increases of shale gas production you would need to start trying to introduce more energy efficiency measures.”