By Marco Alverà, President of GasNaturally.
Fighting climate change and improving air quality are among the most pressing challenges of our time.
Natural gas will play a significant role in addressing these challenges. For Europe, 2017 and 2018 are crucial years as 3 major pieces of legislation are being discussed: the Clean Energy Package, the Emissions Trading System Reform, and the Mobility Package.
Central to the debate of all of these initiatives is the use of natural gas. These new rules will be under discussion in the coming 12-18 months and there is therefore an opportunity for our industry to highlight its advantages to the public and their representatives at a national and EU level.
What makes gas different from other fuels?
Natural gas is the cleanest burning fossil fuel. It releases 50% less carbon dioxide than coal when burned as a domestic heating fuel or for industrial uses. Replacing an old coal-fired power plant with a contemporary CCGT plant can reduce carbon dioxide emissions by up to 50%.
Natural gas also complements renewables as a reliable, lower-carbon back-up for intermittent sources of power, such as wind and solar.
Gas does not require high levels of investment either, as much of the transport and storage infrastructure is already in place, doesn’t need subsidies and is thus currently the only environmentally-friendly market solution.
These strengths explain why demand for gas is growing even under the IEA’s scenario which contains global warming below 2 degrees. According to Statoil, the world will need the equivalent of 15 Norways – Europe’s largest producer of oil and gas – to meet this growing demand as existing fields are being depleted.
The industry is collaborating on new and better ways of extracting, transporting and processing natural gas. This will minimize negative environmental impacts and encourage further diversification of energy sources and routes, which will in turn ensure the security of energy supply.
Confronting a global gas market
There is no denying that geo-political considerations – as well as environmental concerns – will define the world’s energy future. In Europe, for example, there is still enormous potential for indigenous exploration and production.
Other fuels with more of a local presence have gained ground at the expense of natural gas. There is clearly some catching up to do in advocacy terms, which is where GasNaturally will play a crucial role.
Part of GasNaturally’s mission involves making consumers more aware of where their natural gas comes from. This will be increasingly important as new production becomes available, which in turn will lead to greater liquidity and availability. Europe’s vast amounts of available gas storage give it a strong hand to play.
Gas is also becoming a game-changer in transport.
Heavy vehicles like buses, trucks and ships are increasingly reliant on natural gas. Electric power for these fleets is unlikely to become an option in the medium-to-long-term because of issues with storage.
Back home in Italy, we already have 1 million gas vehicles on the road. While I don’t see natural gas as a substitute for electric cars, I’m convinced that there is room for multiple solutions to solving our air pollution issues.
What’s crucial is that policies are technology-neutral and allow the market to evolve organically.
To sum up, it’s clear that gas is a fuel for the future, to substitute higher carbon sources and to complement renewables. Natural gas will continue to have a vital role in combating climate change and improving air quality.
Marco Alverà is President of GasNaturally, the partnership representing the European gas industry. He is also Chief Executive Officer of Snam and chairs the company’s Snam Rete Gas subsidiary, which operates in natural gas transportation and dispatching. In addition to his energy experience, he has a background in finance and commodities and holds a degree in philosophy and economics.