The Gordian knot of Europe’s dependence on gas – News Couple

The Gordian knot of Europe’s dependence on gas

At the COP26 climate conference last week, activists awarded Norway a “fossil of the day” award. It’s a tribute that the new Oslo government could have done without on its first world outing. But it highlights the dilemma faced by Norway, as a large producer of fossil fuels, and even more so by the European Union, whose economy is heavily dependent on natural gas.

In a lively first interview, Jonas Gahr Store, Norway’s new prime minister, told the Financial Times that Europe’s green transition requires his country to keep digging. He said a rapid end to Norway’s hydrocarbon supply would “put an end to the required industrial transformation” of decarbonization.

It is, of course, a self-serving argument. They run counter to the International Energy Agency’s roadmap to net zero, which calls for no further investment in new oil and gas projects. It also goes against the European Union’s fanciful demand to end hydrocarbon extraction in the Arctic.

However, the argument may be correct. It is technologically correct, as replacing natural gas with coal and oil is the necessary next step to reduce emissions. It captures important facts about the political economy of oil and gas exporting countries. Even climate-conscious populations like Norway have nowhere near the majority to phase out fossil mining. It reflects the geopolitical reality: less Norwegian gas will make Europe more dependent on the whim of Russian President Vladimir Putin.

Above all, it exposes the political challenge to the EU’s green ambitions. The decarbonization intent is real. But the continent is still highly dependent on natural gas, and it will become even more dependent by weaning itself off coal.

However, the short-term reasoning comes with a long-term contradiction. If the EU encourages gas investment to meet short-term needs, it may lock itself into its dependence on gas for a long time. The argument for gas as transitional energy is at odds with the fact that no one developing a gas field plans to decommission it in five to ten years. So the EU and Norway are in a hypocritical quandary, with North Sea gas set to power European homes and businesses in the long term.

There is a way out, as all parties are aware. Natural gas does not need to be burned due to its energy content. It can act as an intermediate for hydrogen. If carbon is captured and stored (CCS) in the process, the resulting “blue” hydrogen is a carbon-free energy source.

Techniques exist for its use to power heavy vehicles that are not suitable for batteries, ships, and high-temperature industrial processes such as steel. In fact, it is difficult to remove carbon from some activities in any other way, and CCS is indispensable condition If net negative emissions are possible.

What is missing is the infrastructure and the market. Converting gas from a combustible energy source to hydrogen feedstock requires transportation and storage of hydrogen and carbon dioxide, and carbon sequestration facilities. Such investments are difficult to justify unless sufficient demand is expected.

This is a chicken and egg problem. In order for there to be sufficient demand, it is necessary to adopt hydrogen-powered technologies in the relevant sectors. This, in turn, is only economically viable if users are confident that hydrogen supplies will be forthcoming.

It is the power of the European Union to create a market. From the gift of gas-producing countries to ensure the supply of hydrogen on a large scale. But for either of them to happen, the two must jump together.

The European Union bears the greatest responsibility for this. It has a hydrogen strategy. But speaking to Norway’s public and private sector decision makers, skepticism that the EU means business is close to the surface. They question whether Europe has the guts to make the hard choices that net zero demands, such as the unbearable price of carbon. And is Europe entirely in favor of blue hydrogen and carbon dioxide capture and storage, or is it related to the less efficient “green” hydrogen made from water electrolysis? Such a choice would be as self-defeating as Germany’s turning away from nuclear power, which made it use more coal.

If the European Union were to commit to blue hydrogen, and put its money in place, it might demand the corresponding commitment to supply from Norway. Instead of imposing a ban on Arctic exploration, he could demand a policy to allow more gas extraction only with infrastructure that can be quickly converted to blue hydrogen production with carbon storage.

Politically, or even legally binding, tools can be found to reassure each side that both supply and demand will be imminent. For Oslo, such a policy offers a compromise with those who demand a complete phase-out of fossil fuels. He may even be allowed to return his prize in Glasgow.

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