This weekend, Germany became the latest large European economy to lay out a plan to phase out coal-fired power generation, aimed at cutting carbon emissions—a metric in which Berlin has been lagging in recent years.And from the Australian Financial Review, February 7:
A government-appointed special commission at Europe’s largest economy announced on Saturday the conclusions of its months-long review and proposed Germany to shut all its 84 coal-fired power plants by 2038.
While Germany will mostly seek to replace coal capacity with renewables, the country’s suppliers of natural gas expect to benefit from the coal exit because natural gas-fired capacity could offer steady supply.
Norway, currently Germany’s third biggest natural gas supplier after Russia and the Netherlands, expects demand for gas in Germany to increase, Irene Rummelhoff, member of the executive committee and Executive Vice President, Marketing, Midstream & Processing (MMP) at Equinor, told Reuters last week, before the German ‘coal commission’ announced the conclusions of its report.
Norway and Equinor compete with Russian gas supplies. Then there is the possibility that the Gazprom-led Nord Stream 2 pipeline project between Russia and Germany via the Baltic Sea become operational, despite all the controversies surrounding it and the steady opposition from the U.S. and some EU states like Poland and Lithuania.
Still, Equinor believes that there would be a larger market for its gas in Germany, because Berlin—also on track to shut down nuclear capacity by 2022—can’t start running on renewables only while it also phases out coal, according to Equinor’s Rummelhoff.
“I think it could be an increasing market for us going forward,” the manager told Reuters at an industry event in Berlin.
“The quicker the phase-out (of coal), the stronger the demand for gas as I see it because there is no other viable alternative,” Rummelhoff added.
The residential heating sector and the public transport sector are expected to need more gas, according to Equinor’s manager....MORE
Natural gas boom may never arrive despite Germany's coal exit
The natural gas industry's hopes of seeing a jump in demand in Europe may never happen as renewables become more cost-effective, according to a report by one of Germany's largest energy companies
The report, seen by Bloomberg News, plays down the widely assumed theory that gas will benefit because it is the only other stable source of power in Europe's biggest market, as Chancellor Angela Merkel is also shutting down the nation's remaining nuclear reactors.
Renewable technology costs are expected to fall further, boosting the expansion of wind and solar. As a result, gas demand growth for electricity production as a result of coal closures will be limited. Gas demand may drop more than 20 per cent in households and power plants using the fuel, the study showed.
"You can't expect to see a big increase in demand just because of the coal exit," said Harald Herzig, head of front office at Mainova, a utility in Frankfurt which was not involved in the study. "German natural gas demand, even with coal phasing out, might increase just a little, because the other sectors like households and industry will most probably reduce their demand."
However, other producers, from industry lobby Zukunft Erdgas to Austrian producer OMV and Raiffeisen Capital Management, are bullish and expect the fuel's share in the German energy system to increase.
A study by the lobby group shows that Germany is expected to require additional gas-fired capacity of between 50 terawatt-hours and 81 terawatt-hours per year by 2022, when the first phase of the planned coal exit ends. (A terawatt is 1000 gigawatts.) That would boost overall consumption by between 5 per cent and 7 per cent and double the use of gas for electricity generation....MORE
