Page 11 - FSUOGM Week 29 2022

FSUOGM POLICY FSUOGM

IEA warns of "long, hard

winter for Europe

EUROPE THE EU faces a “red alert” regarding Russian gas levels, if domestic gas production in Europe con-
supply, and it will need to prepare for “long, hard tinues to follow recent trends, and if inflows of
Birol has called for gas winter,” the head of the International Energy LNG increase at a similar record rate as they did
consumption cuts. Agency (IEA), Fatih Birol, said in a post on July in the first half of this year.”
18. “That is already a lot of ‘ifs’, and as mentioned
The IEA has been pushing for Europe to above, this scenario also assumes that Russian
cut its reliance on Russian gas since before the gas flows through Nord Stream will resume at
war, raising the alarm in September last year the end of the current maintenance period at the
that Gazprom was intentionally holding back same levels as before it,” he said.
supply from the European market to drive up Birol proposed five actions European lead-
prices. It went on to release a 10-point plan for ers could take to curb gas use. He called for the
achieving this reduction, including a ramp-up introduction of auctions that would give EU
in renewables deployment, an increased industrial users an incentive to reduce demand
focus on efficiency and an expansion in LNG by offering up part of their contracted supply.
imports. Such auction models are already being devel-
While Europe has made some progress on oped in Germany and have been proposed in
reducing its Russian gas imports, this has not the Netherlands.
been enough, Birol said. Europe can also minimise gas use in the
“Russia’s latest moves to squeeze natural gas power sector, by switching temporarily to coal
flows to Europe even further, combined with and oil-fired generation, while doing what it can
other recent supply disruptions, are a red alert to increase deployment of low-carbon sources,
for the European Union,” he said. “As we get including nuclear, where politically acceptable
closer to next winter, we are getting a clearer and technically feasible. Gas and power opera-
sense of what Russia may do next. The next few tors across Europe should also co-operate more,
months will be critical.” including on peak-shaving mechanisms. This
There is constant uncertainty about future should include strict co-operation regarding
Russian gas supply, and a complete cut-off the operation of thermal power plants (TPPs) at
cannot be ruled out, Birol said. Nord Stream is national and European levels.
undergoing routine maintenance, due to run There should also be efforts to curb house-
until July 21, but it is unclear whether the pipe- hold power demand by setting cooling standards
line will resume flow, and at what level. If Russia and controls, and there should be campaigns to
were to resume Nord Stream flow on time, but promote voluntary actions. Emergency planning
halt gas supply on October 1, Europe will need across the EU should also be harmonised at the
to have filled its gas storage facilities to 90% by national and European level, and this should
that point, in order to have enough supply to get cover measures for supply curtailments and sol-
through the winter. And even then, supply dis- idarity mechanisms.
ruptions towards the end of the heating season “If these types of measures are not imple-
could still be possible. mented now, Europe will be in an extremely
“Achieving that 90% storage level is still possi- vulnerable position and could well face much
ble, but Europe needs to act now and make every more drastic cuts and curtailments later on,”
remaining day count,” he said. Birol said. “In addition to the measures above,
First Europe must cut consumption, to free European governments also need to prepare
up more supplies for storage. Some 12bn cubic the people of Europe for what may be coming.
metres of extra gas will need to be placed into Public awareness campaigns in the context of
storage over the next three months, Birol said, an energy crisis have been successful previously
noting this was enough to fill around 130 LNG in reducing short-term energy demand by sev-
tankers. eral percent. Every action counts. Simple steps
“This is a big ask, but it does not exaggerate such as turning down the heating by a couple of
the scale of what is needed – or what is possi- degrees in Europe can save the same amount of
ble if the right measures are taken,” he said. “It is natural gas that is supplied over the winter by the
categorically not enough to just rely on gas from Nord Stream pipeline.”
non-Russian sources – these supplies are simply Birol concluded saying this winter could
not available in the volumes required to substi- become “a historic test of European solidarity –
tute for missing deliveries from Russia. This will one it cannot afford to fail – with implications
be the case even if gas supplies from Norway and far beyond the energy sector. Europe may well
Azerbaijan flow at maximum capacity, if deliv- be called upon to show the true strength of its
eries from North Africa stay close to last year’s union.” ™

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