Molecules – The Eurogas Newsletter (March 2019)

Molecules – The Eurogas Newsletter (March 2019)

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This month’s edition of the Molecules features innovation and explores opportunities and challenges laying ahead of the gas industry in relation to the energy transition. As we approach our Annual Conference taking place tomorrow, we would like to take you on our March journey packed with events, meetings and a taste of upcoming initiatives.

The European Union (EU) aims to reduce greenhouse gas emissions by 20% before 2020, by at least 40% before 2030 and reach climate neutrality by 2050. While the energy system of the future must be clean, affordable and sustainable, it should also ensure that the EU has industrial leadership, jobs  and access to energy.  These objectives  call for a blend of energy sources and technologies.

Creating the low-carbon energy world of the future needs new ideas and synergies. Gas has an innovation potential like no other fuel and can be used as a solution across all sectors of the economy: heating, power generation, transport and industry. Delivering the energy transition for a competitive Europe requires taking full advantage of gas in all its forms as part of the future sustainable energy mix through decarbonisation and technological development.

Natural gas will play an increasingly important role in the coming years as it will offer the flexibility to complement variable electricity sourced from renewables. Carbon Capture and Usage/Storage is one of the building blocks of the European Commission’s long-term strategy for emissions reduction and will therefore be instrumental in closing the circle for the energy intensive industries for which no other solutions exist today.With the right policy framework, power-to-gas could be applied on an industrial scale rather quickly. As with the development of wind and solar energy over the last decade, this would allow for economies of scale and support speedy deployment. Produced from renewable sources, as well as from natural gas, hydrogen has tremendous potential for CO2 mitigation. Creating a prosperous tomorrow with waste from today is also a clear win-win for society. Many second generation sources can be used to produce biogas and biomethane: manure, sewage and biowaste. With Europe producing more waste than ever – turning it into biogas means contributing to the circular economy.

All these opportunities and challenges will be discussed at this year’s Eurogas Annual Conference: Gas – part of the solution tomorrow. I look forward to welcoming you all for what promises to be a great discussion!

Martin Herrmann, Eurogas Acting President

In the beginning of March, Eurogas met with the European Commission to discuss the associations’ views on tariffs, licensing regimes and storage. By advocating for the removal of the remaining regulatory barriers to the storage market, ensuring thorough implementation of network codes and avoiding undue administrative burden to the obtention of a license to operate, Eurogas works towards a stronger internal market for gas. A more robust gas market can help provide lower prices for a more competitive European industry and ensure an economic energy transition for the final consumers.

In particular, Eurogas discussed some of the remaining issues to be tackled on this topic with the Principal Adviser to the Director General of DG ENERGY, Tudor Constantinescu, a hydrogen expert. A key area of discussion was ongoing research on blending hydrogen and methane and the ability of grids to accommodate hydrogen. Depending on the model and the type of grid, some existing grids can take 100% hydrogen with limited need for modifications to the infrastructure.

Eurogas also participated at a high-level roundtable with representatives of the Algerian Embassy to the EU, Algerian Energy Ministry, NRA, Algeria TSO, National Energy Agency and Sonatrach. Nicolas Jensen and James Watson presented the PRIMES study – published in May 2018 and focusing on a future in which the EU’s agreed climate targets are met – and the outlook of gas market evolutions. Emphasis was put on the importance of diversifying supplies, and notably on the role of LNG. The European Commission presented their Long-Term Strategy, with the International Energy Association (IEA)  and  representatives from think-tanks Bruegel and IFRI, who also shared insights and projections.

Those present supported a clear consensus that gas would retain a key function towards 2050, and that the quantity of renewable and decarbonised gas achieved would determine Europe’s overall gas usage. Algerian representatives took note of the strong potential for hydrogen production from natural gas as a way to further reinforce a long-term energy partnership with the EU.

Sector coupling workshop
On 6 March, energy stakeholders from along the value chain met in Brussels for an exchange with the consultants’ consortium in charge of the sector coupling study commissioned by the European Commission. The study aims to assess what regulatory barriers exist today with regards to sector coupling between the electricity and gas sector. Although coupling exists today in the gas-to-power direction, with gas providing the cleanest source of backup flexibility to the electricity grid, this is poised to evolve through the development of technologies such as power-to-gas. The latter would consist of converting excess electricity into hydrogen to provide longer term storage than battery, which can only provide short-term flexibility.

Stakeholders highlighted the issue of looking at sector coupling in isolation from other sectors – such as industry – which could account for 1700 TWh of demand in 2050, or heating, mobility and agriculture, which would make up the bulk of energy demand in 2050.

The consultants had identified all relevant barriers to sector coupling, such as the need for technical clarity with regards to hydrogen blending and injection, or the need for a regulatory framework fit for purpose in supporting renewable and decarbonised gas development. The issue of policy recommendations was not tackled and would only be assessed in the coming months while the consultants would work on refining the report. Eurogas underlined the importance of sector coupling to ensure a cost-efficient energy transition by using existing gas infrastructure and avoiding unnecessary costs to citizens for new investments in infrastructure.

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The future of gas in Europe

James Watson spoke about renewable and decarbonised gas in the conference organised by the Greens/European Free Alliance in the European Parliament on 7 March. He spoke about the role of gas in our daily lives and our economy today and discussed gas’ potential to deliver a competitive decarbonised energy system tomorrow.
Gas infrastructure already exists, largely amortised and offers a good base for competitiveness. caling up the production of renewable and decarbonised gases will ensure the continuity of this infrastructure whilst reducing its carbon footprint. Watson emphasised the importance of ensuring renewable and decarbonised gas is recognised in the objectives which Member States have to achieve in terms of reducing greenhouse gas emissions.

Watson reflected on the challenges laying ahead of the industry such as scaling hydrogen production, blending potential of various fuels, ensuring the technology is cost-competitive, but also communicated the policy proposals put forward for the gas package: introducing an EU target for renewable and decarbonised gases, developing a European blueprint for Guaranteed of Origin for hydrogen, enable the development of technologies to decarbonise the gas supply e.g. pyrolysis, CCS/U and SMR.

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The big picture of a just and clean European energy transition in 2030

Eurogas joined the launch of Agora’s flagship report – European Energy Transition in 2030: The Big Picture on 7 March. The event called attention to the benefits of a just and clean European energy transition and that these prevail over the costs if well planned and managed. The publication concluded that considerable investment will be required to finance the transition, however states that costs will be comparable with those of the current energy system. Furthermore, the clean-energy transition is forecasted to boost GDP, employment and energy security, as well as prevent health costs from growing. The report does not anticipate an increase in household expenses for meeting 2030 targets, however warns energy and trade intensive branches will need support to ensure EU’s industrial competitiveness.

Following the presentation of the study, Eurogas Secretary General, James Watson, joined the panel discussion on the recommendations for power and industry. He emphasised the role of renewable and decarbonised gases in delivering an affordable and competitive energy mix and highlighted the massive chance for technology and industrial leadership that gas offers the EU. Such technologies as power-to-gas, CCS, STR, micro-CHP and fuel cell have can help the European Union reach its climate ambitions on time and in a cost-effective and socially-acceptable way whole providing local manufacturing jobs and growth. “The use of renewable and decarbonised gases will play an essential role in delivering climate targets and keeping European employed”, said Watson.

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European Climate Foundation Report Launch: Towards Fossil-Free Energy in 2050

On 14 March, Eurogas Secretary General James Watson took part in a conference hosted by the European Climate Foundation (ECF) following ECF’s publication of a new report titled Towards Fossil-free Energy in 2050.

The study refers to the European Union’s target to achieve net-zero carbon emissions by 2050. The study assumes electricity as the key component in the future energy mix, supported by hydrogen during times of peak consumer demand. Watson emphasised the clear role of gas, such as hydrogen, in the energy transition. “Gas is essential in the future energy mix to achieve carbon neutrality – particularly by 2050,” he said.

Sami Andoura, Leader of the Sustainable Development Team at the European Political Strategy Center, highlighted that one of the biggest challenges will be finding a way to save the planet in an economical way. That is to say, decarbonising our economy without threatening vast quantities of jobs. One way to do this is to gradually develop renewable, decarbonised energy sources.

For example, converting surplus electricity generated from renewable energy (solar power when it’s particularly sunny, and wind power when it’s very windy) into green hydrogen through a conversion process known as ‘power-to-gas’. “By literally turning power (electricity) into gas (hydrogen) we create a type of renewable, decarbonised gas which can help to make the energy transition cost-efficient by using the existing gas infrastructure,” Watson continued.

Storing renewable and decarbonised gas in existing gas infrastructure means it can be used to support renewable energy sources, for example when the sun doesn’t shine and the wind doesn’t blow. In this way, green hydrogen increases the reliability of renewables, by allowing them to become a year-round energy provider. Other types of renewable and decarbonised gas can also join the energy mix in order to improve the range and flexibility of sources and further diversify the energy supply.

Eurogas fully supports the use of the integrated European gas network. By working with over 44 members, Eurogas is committed to developing policy frameworks at EU level that will encourage the development of renewable, decarbonised gas; advising relevant stakeholders on the capabilities of the gas sector in the energy transition; as well as participating in the implementation of future energy legislation.

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Finnish Energy meeting

On 18 and the 20 March, the Eurogas team met with the Finnish energy association. Discussions were aimed at outlining Eurogas’ vision of the future for the European gas market. The exchange tackled several issues, namely the importance of implementing EU legislation adequately when setting up a nascent market, but also the importance of diversified supplies.

To this end, the importance of LNG but also of potential market consolidation in the Baltic states could diversify options for Finland’s gas market. The development of renewable gas produced from waste and biomass was recognized as important, notably for use in vehicles. The potential for the development for hydrogen development was also touched upon. International developments, notably Asian developments in terms of LNG but also the construction of hydrogen pipelines in China were noted.

The main issue that was underlined was the need to build a market for renewable gas, to enable cross-border trade. To this end, the importance of setting up an adequate certification system was expressed. A suitable framework would enable the trading of both renewable and decarbonised gases across borders, but demand for these certificates would very much depend on what use could be made of guarantees of origin. As such clarity on the scope of the framework would be necessary to ensure that it wouldn’t have negative impact on parallel systems.

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The future of gas in an electrifying Europe – 20 March

What is the role of gas in the future European energy mix? Eurogas joined the CEPS event that presented the SET-Nav study about the future role of gas in an electrifying Europe.
Florian Ermacora, DG Energy, European Commission emphasised the importance of the gas sector in reaching climate targets and delivering a sustainable energy system. Security of supply and affordability were recurrent points in his keynote speech and in this respect, he stated the development of technologies such as CCS and power to gas will be essential. In terms of regulatory framework, gas quality harmonisation at EU or at DSO level was mentioned as crucial to ensuring existing gas infrastructure could be used to inject renewable gas from decentralised production and improved to potentially inject large quantities of hydrogen.

Additionally, guarantees of origin will need to be implemented to ensure final customers are informed that a given share of their energy was produced from renewable sources. Sector coupling was also mentioned in terms of blending of infrastructure: gas, electricity and heat will require a more holistic approach.

Contributing to a CO2 neutral gas supply: On the road to 2050 – what role for renewable gases and gas infrastructure?
9 April, Brussels

A Euractiv high-level workshop where Frontier Economics will present their study “The value of gas infrastructure in a decarbonised Europe”. James Watson, Eurogas Secretary General, will join Klaus-Dieter Borchardt, DG ENER Director, Kristian Ruby, Eurelectric Secretary General, and Milan Elkerbout, CEPS Research Fellow in the discussion on the evolution of the gas infrastructure and on the challenges related to renewable gases.

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The fight for the EU energy security – 11 April, Brussels

Energy security is important on the EU national security agenda — part of the Continent’s response to a rise in geopolitical uncertainty. Clashing interests, regulatory issues, costs and political rivalries over all these projects will significantly change the EU’s gas map in the next years.
Join our Secretary General, James Watson at Politico’s event featuring leading experts from the European Commission, European Climate Foundation, European Parliament and other organisations.

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FLAME 2019  “25th Anniversary” – 13-15 May, Amsterdam

This special edition will highlight the evolution of gas in the energy mix of the future, its role in different sectors. The conference will also explore new technologies and innovations for gas and how these can contribute to the energy mix.
Eurogas is delighted to participate in the panel featuring “The greening of the gas grid & bringing innovation to the system” with Secretary General, James Watson speaking.

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European Heat Pump Forum – 15-16 May, Brussels
Organised by the European Heat Pump Association on 15 May, heat pump technology will be at the heart of this year’s edition debate. The long-term strategy for a climate neutral Europe by 2050, digital growth and market developments in Europe, technological deployment are part of the planed policy discussions.
James Watson will join leading figures for the panel: “Campfire debate: We can’t electrify everything, but can we provide green molecules to every application?”.

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The smarter E Europe – 15-17 May, Munich

We are teaming up with The smarter E and Hydrogen Europe to launch the first edition of the Power-To-Gas Pavilion and conference as part of the largest energy industry platform in Europe. Hydrogen Europe and Eurogas are strategic partners of the side event taking place during the Ees Europe conference “Power-to-X” on 16 May. The conference will look into the technological developments of Power-to-X technologies and what is their role in delivering a sustainable energy future.
Further details will soon be available on our event page and social media channels. Stay tuned!

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Sector Coupling 2.0: Power to Gas in the EU Decarbonisation Strategy – 17 May, Florence
Last year, the Florence School of Regulation organised its first workshop on “Coupling the Sectors”, as part of its regulatory policy workshop series. This year’s edition will cover the power-to-gas technological landscape, identify the potentials for the different technologies and their future economic viability.
Eurogas Secretary General, James Watson, will join this event and participate in the second session of the day focusing on the implications of the deployment of power-to-gas technologies for sector coupling and the appropriate regulatory and market design responses.

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REGATEC 2019 – 20-21 May, Malmö
The 6th International Conference on Renewable Energy Gas Technology 2019 (REGATEC) organised in collaboration with LFG Baltic takes place on 20-21 May 2019 in Malmö, Sweden. At this technical and industrial focused event, the discussion will evolve around policy issues related to biomethane, renewable methane, biogas, power-to-gas, and many more.
Eurogas Secretary general, James Watson will talk about “Gas – a vital part of the renewable energy future” as part of the first panel on 20 May.

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GIE Annual Conference – 13-14 June, Paris
The GIE Annual Conference is an opportunity to meet and exchange with key gas players on the latest trends and news in gas infrastructure. This year’s edition will be located in the heart of Paris, one of Europe’s most fascinating historical cities. The French gas infrastructure operators ELENGY, GRTgaz and Storengy will be the hosts. Conference website & programme: www.gie.eu/conference
James Watson, Eurogas Secretary General, will be speaking on the panel “Making the world go round: circular economy” on day 1.

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Eurogas is back to the EU Sustainable Energy Week (EUSEW) with interesting policy sessions – 18-20 June, Brussels

The Policy Sessions (18-20 June) are the highlight of the EU Sustainable Energy Week every year. Eurogas is involved in a number of sessions featuring leading experts that will discuss most efficient pathways to shaping Europe’s future energy mix.
Keep an eye on our website here, the full programme will soon be published!

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The European Utility Week with co-located event POWERGEN Europe  –  12-14 November 2019, Paris
Eurogas is pleased to be a partner of this year’s edition of the European Utility Week and POWERGEN Europe. The European Utility Week is a large end-to-end energy industry event.  With an expected audience of over 18,000 international power and smart energy professionals. POWERGEN Europe attracts attendees from all of the largest and most influential power providers, utilities, governments and solution providers. It has established itself as the centre point for the power generation sector.

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More Eurogas events coming up! 
Eurogas General Assembly Meeting – 27 June, Oslo
Policy networking cocktail event – July TBC, Brussels
Central and Eastern Europe Conference – TBD

 

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