Europe must reduce gas consumption, even if storage facilities are full next winter

The European Union is on track to surpass gas storage filling targets, but analysts warn the bigger factor in energy security this winter will be whether countries can reduce consumption enough to ensure that the stored fuel survives the coldest months.

Europe’s gas storage facility is now 79.94 percent full after a summer scramble after Europe’s top gas supplier Russia invaded Ukraine, data from Gas Infrastructure Europe shows, prompting countries to surpass their target to have 80 percent full stores by November.

In a normal year, that could cover Europe’s winter peak in gas consumption. But in 2022, with Russia’s flows already significantly lower — the amount of gas it sends through Nord Stream 1, its main pipeline route to Europe, is only 20 percent of capacity — storage won’t even the balance.

Full gas storage could supply European countries for about three months at best, according to Aurora Energy Research. In Germany, where almost a quarter of EU storage is located, stored gas could cover average demand for 80 to 90 days.

“To deal with this crisis situation, reducing demand will be even more important than storage,” said Simone Tagliapietra, senior fellow at the Bruegel think-tank.

With around 888 terawatt hours (TWh) of gas stored, EU countries have already surpassed the 858 TWh their stockpiles reached before last winter.

But if countries don’t curb their use of the fuel, Europe’s gas caverns would still be empty by March, according to modeling by data intelligence firm ICIS, told Reuters — even in a scenario where some Russian gas flows throughout the winter, and the weather is not unusually cold.

To avert a winter supply crisis, countries must reduce their gas consumption to 15 percent below the five-year average each month, ICIS said. That would mean that stocks would be 45 percent full after the winter if Russia continues to send gas, and 26 percent if Russia cuts supplies from October.

A combination of no Russian gas and no aggressive reductions in gas use in industries and buildings “could lead to electricity rationing this winter,” said Mauro Chavez Rodriguez, European gas research director at Wood Mackenzie.

So far, however, there has not been a sustained cut in gas demand on the scale required, although exceptional gas prices have forced several industries to cut production – a phenomenon currently affecting two-thirds of Europe’s fertilizer production capacity.

EU countries agreed in July to cut gas consumption by 15 percent this winter compared to average winter levels in 2017-2021. Europe’s gas consumption in the first half of August was 11 percent below the five-year average, according to ICIS.

If gas is not saved this winter, it will be much more difficult to fill the storage for the next winter. If that happens and Russia stops the flows, Europe’s storage could run out by November next year, the Oxford Institute of Energy Studies said.

LNG imports have helped Europe fill storage quickly this year.

https://www.independent.ie/business/world/europe-will-have-to-cut-gas-use-even-if-storage-is-full-come-winter-41954687.html Europe must reduce gas consumption, even if storage facilities are full next winter

Fry Electronics Team

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