: Opinion: Europe’s changing energy market #IndiaNEWS #News By Michael Bradshaw Accusations continue to fly about the cause of major leaks from the two Nord Stream pipelines transporting gas through

Opinion: Europe’s changing energy market #IndiaNEWS #News
By Michael Bradshaw
Accusations continue to fly about the cause of major leaks from the two Nord Stream pipelines transporting gas through the Baltic Sea from Russia to Europe. Until this latest development, Russia had maintained that western sanctions were behind disruptions to supply from the Nord Stream 1 pipeline, as maintenance and repair of essential equipment could not proceed. The German company Siemens that supplied the equipment maintains that this isn’t the case. Politicians across Europe have accused Russia of blackmail and of weaponising the supply of natural gas.
Whatever the truth, most of Europe will now have to face winter 2022, and likely beyond, without any Russian pipeline gas. The EU is determined to end its reliance on Russian gas as soon as possible, a process that might be accelerated by current events. The next two winters are going to be very challenging for all of Europe’s gas consumers: households, businesses and industry. But moves are in play that will fundamentally change the continent’s position in global gas markets.
In the past, Europe played a balancing role: a place where liquefied natural gas (LNG) cargoes were sent, normally in the summer months, when demand was low in Asia. As such, LNG was marginal in European gas security relative to Russian pipeline gas. If, by 2027, Europe no longer imports Russian gas of any kind, then it will have to compete with Asia as a centre of demand. How long it will take for the LNG market to increase supply to meet Europe’s new demand is unclear, but the global market will rebalance as a result.
Bleak Winter Ahead?
Russia supplied around 40% of all the gas consumed in the EU in 2021. Germany is especially reliant on this supply of cheap gas. Gas only generates about 15% of the country’s electricity but many rely on it for heating and it is vital to heavy industries such as petrochemicals that use a lot of energy.
Drastic measures are now necessary to secure alternative supplies, reduce gas demand and prepare for the possibility of shortages this winter. The EU’s Save Gas for a Safe Winter programme aims to reduce overall gas demand by 15% across the bloc this winter by asking people to turn down thermostats in homes and offices, for example. Further measures are expected in the coming days.
The good news for supply to Europe is that its other sources of pipeline gas – Norway, North Africa and Azerbaijan – are all flowing normally. Winter storage is over 80% full, which is well ahead of the EU’s deadline to hit this milestone by the end of October. Europe’s ability to get through the winter without a gas supply crisis will depend in large part on the weather: not just how cold it is, but also how sunny and windy, as gas backs up renewable power generation in many countries.

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