Javier Ramírez

Natural gas is here to stay

Global warming is an unprecedent challenge that needs political will to overcome it, but that is not enough. It is one thing to claim and set objectives and another, technical and economic capabilities. In the absence of cleaner, affordable, safe, and reliable alternatives natural gas will continue to be an important source of energy globally for a long time. The scenarios drawn for 2050 are still more or less plausible approaches driven more by policy than by the evaluation of technical and economic capacities. Any projection that includes abandoning gas and belittling it as a transition energy towards renewables is unrealistic and therefore a mistake.

After decades of continuous growth, 2020 pandemics reduced the global consumption of natural gas. But the effect of the sudden and prolonged activity standstill was only a 5% decrease in gas consumption, well below the rates showed by other energy sources more closely related to transportation and mobility as kerosene, petrol, and fuel. Natural gas main usages -power generation, industrial production, and heating- were much less affected during the lockdown.

The quick recovery of fossil fuels demand in the aftermath of the confinement shows that the fall was little more than a mirage.

Valclav Smil, scientific researcher in the fields of energy, environmental and population change, Distinguished Professor Emeritus at the University of Manitoba, a Fellow of the Royal Society of Canada and Bill Gates’ “favourite author”, in Microsoft founder’s own words, has recently published a report on the natural gas role in the new energy world, where he describes different future scenarios based on evidences. Smil’s main conclusion is that “the preponderance of historical evidence and technical, infrastructure, and economic imperatives do not indicate that the 2020s or 2030s will be the last decade in which natural gas will remain an essential component of modern energy mix”.

Natural gas is the most reasonable transition source of energy. It is available throughout the world, and it is the cleanest of fossil fuels, which when burned generates carbon dioxide. It will take a long time until we can get the electricity we need only from sustainable resources like wind or sun. Meanwhile, the most efficient is gas.

Despite the positions of some climate change deniers, scientific evidence shows that the Earth is heading for a climate future with catastrophic consequences for its inhabitants, including humans. Governments (and citizens) throughout the world have become aware of it and are working hard to prevent it.

To this end, ambitious goals for decarbonization (and therefore, reduction of fossil fuels) have been set. The goals are not questionable. They respond to strategies designed at the political level based on scientifical evidence of global warming and with the intention of stopping it. What is questionable is how realistic is to expect that these objectives can be achieved within the deadlines. Success or failure in this attempt will largely depend on technological innovations that no one knows positively if and when they will occur, despite the enormous amount of money funding research, development, and deployment of new technologies.

The great challenge of climate action is to make the strong economic and population growth expected in developing countries compatible with decarbonization in the absence of reliable and safe clean energy technologies.

It is to be expected that economic growth will tend to close the energy gap that separates rich countries from the developing world. The average annual energy supply per capita in the EU is 135 GJ, 150 GJ in Japan, and 250 GJ in the United States, Canada, and Australia. In China, it is almost 100GJ. Smil points out that in 2021 half of humanity lives in countries whose annual primary energy supply per capita is less than 50 GJ and 40% of the world's population (3.1 billion people) consumes less than 25 GJ a year per capita, the rate reached in Germany or France in 1860. It is obvious that for this part of humanity to have a decent standard of living, its energy consumption must be multiplied. The multiple will depend on how quickly new clean technologies are deployed and progress is made on efficiency, the “first source of clean energy”, according to Fatih Birol, executive director of the International Energy Agency (IEA).

In addition to this global trend, there are three more specific reasons why gas will need to (at least) remain an important component of the global energy mix for quite some time, even as the weight of renewables in primary energy consumption increases.

First, Smil cites the necessary replacement of coal-fired electricity generation by power from natural gas, complementing the deployment of renewable energies. This will lead to an increase in installed gas generation capacity.

The costs of renewables are already or are close to be lower than those of combined cycle power plant, according to many sources such as the IEA, Greentech Media and the US Energy Information Agency.

But the problem is that renewables are not manageable, at least with current technology and until the huge investments needed are made. An energy system based on these not manageable energies would need storage and high-voltage transmission capacities that do not already exist.

The second reason is the need for seasonal heating. Approximately 850 million people in Europe, the United States and Japan need to heat their homes between a few weeks and seven months a year. Substitution technologies, such as heat pumps or geothermal stations, are not yet a short-term alternative to generating heat by combustion of natural gas in high-efficiency boilers. The replacement of gas infrastructures with direct electric heating will take time and a very high investment.

Finally, natural gas is still irreplaceable as a source of energy in many industrial processes and as a raw material for the manufacture of essential materials. This is the case of the hundreds of millions of tons of ammonia that are needed each year to produce fertilizers. Until alternative technological solutions appear, natural gas needs will continue to grow, especially in Africa, where the population is expected to increase by 1 billion people by 2050. The need to increase domestic food production to feed its population cannot wait for the development of technologies capable of producing green hydrogen on a sufficient scale.

Nor can it be expected that, in a matter of two or three decades, new hydrogen and methanol production techniques will be able to displace current gas-dependent technologies.

Global warming is an unprecedented challenge that requires the legally binding coordinated participation of all countries in the world. It is obvious that overcoming this challenge requires the political will to do so. However, it is one thing to claim and set objectives and another, technical and economic capabilities.

All realistic forecasts of international organizations and energy companies implicitly acknowledge this fact. Smil's report highlights, for example, the coincidence in the projections of the IEA and Exxon on primary energy consumption in 2040: 712 and 718 EJ, respectively, compared to 600 EJ in 2020.

Even the European Council recognized in December 2020  that each Member State has the right to choose its energy mix, at same time it raised GHG emission reduction targets for 2030. The European Commission's Going Climate-Neutral by 2050  document predicts that natural gas will cover 20% of gross energy consumption in the EU in 2030 and 18% in its baseline scenario for 2050.

Beyond the numbers, there are other facts that illustrate the EU's dependence on natural gas in the coming decades. One of them is the completion of the Nord Stream 2 pipeline, which connects Siberia's gas wells with Germany, despite the sanctions imposed by the Trump administration. Another is Spain's efforts to secure gas supply from Algeria, after this country decided not to renew its supply agreement through the pipeline through Morocco and the expansion by 100% of the capacity of the one that connects Algeria and Spain directly.

The EU's decision to treat gas and nuclear energy independently in the development of the green taxonomy also highlights the recognition of the need for accessible, safe, and manageable support energy sources as the energy transition progresses.

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