As I argue in my book, Energy Security and Natural Gas Markets in Europe , market integration is the best tool to enhance energy security within the European Union and beyond.
Better pipeline interconnections and harmonized rules and regulations instead of fragmented national markets facilitate more seamless natural gas flows throughout the European Union. With more options to consider, natural gas buyers enjoy a greater diversity of supply and better leverage when negotiating with their suppliers—and thus more energy security.
Critically, once in the EU, natural gas can be freely traded, as any other commodity.
Regardless of the aforementioned limitations, it will be difficult for Russia to implement its ambitious plans. Energy Market Analysis. The share of energy-intensive manufacturing exports in total U. State of the Energy Union: Policy influencers debate the 1st year's progress. Moreover, the importance attached to these values and their operationalization are different in the various parts of Europe. In an updated forecast published in November of , the IEA predicts that LNG will account for 60 per cent of the global gas trade in Even direct and indirect through tax exemptions state support will be insufficient.
This market-based approach—which has been the leading paradigm of the European Commission—has been fairly successful over the past decade. These days, buyers pay more competitive prices for gas. Suppliers who do not play by the rules end up in court.
The Future of the Natural Gas Market in Southeast Europe analyzes the role of natural gas in the energy mix to meet future demand in nine markets in the region . This study was to analyze the future role of natural gas in the energy mix of countries of South East Europe. The study further identifies regional, cross-border .
Two broad developments are further complicating this European success story. A fierce political debate has erupted over whether Europe should import even more Russian gas in the future, which is what market forces dictate.
Second, European policymakers increasingly question the role of natural gas as they seek to transition towards a low carbon economy. Here, diversity means less natural gas from Russia , although it remains unclear who should pay for this.
Several Central and Eastern European member states, as well as the European Commission, support this principle. The U.
Its operator had planned its investment within an existing regulatory framework, but this framework has been subjected to heavy meddling for political purposes. The debate over the Nord Stream 2 project should have kick-started a meaningful discussion about the division of responsibilities among governments, companies, grid operators and regulatory authorities, for example within the European natural gas market. But to date it has devolved into gridlock between proponents and opponents.
Instead, Gazprom could market its gas at a single EU price adjusted for differences in transport costs to compete with domestically produced resources and imports from other parts of the world. There are also questions about the future role of natural gas in the transition toward a low carbon economy —including whether there should be any role for it after Renewable sources have made major inroads in the electricity sector, even though decarbonization remains a challenge absent a well-functioning emissions trading scheme.
However, in light of the urgent need to decarbonize, and considering the prominent role that coal continues to play in the EU, it seems premature to write off natural gas in power generation just yet. Our data suggest that Europe will likely need natural gas for at least a few more decades.
Meanwhile, more can and should be done to improve the greenhouse gas footprint of the fuel source. Furthermore, Europe has to look beyond the electricity sector towards deep decarbonization across the entire energy system. At the beginning of the present decade, the main targets of EU energy policy were incorporated in the long-term strategies of SEE countries.
Lately, the focus has been redirected towards modernisation of energy infrastructure, the construction of new facilities, including electricity and gas interconnections, improvement of energy efficiency and increased use of RES. The industry structure, in terms of ownership and regulation framework is currently changing in several SEE countries.
The role of the state is reconsidered and the level of privatization and liberalization of electricity and gas markets can help shape the new business environment, creating exciting opportunities for market players, especially in power generation and gas supply and their corresponding retail sectors. Share it on:. Sponsor Supporters Media Partners. Download Program.