Opinion: the recent diplomatic kerfuffle between the UK and Russia has had some in Europe wondering if we should be worried about an interruption in gas supply as a result
The recent dramatic deterioration in UK-Russian diplomatic relations has refocussed attention on Europe’s dependence on Russian energy. Russia is the largest supplier of coal, oil, and gas to the EU. While the expulsion of Russian diplomats across Europe exposes an uneasy political relationship with Moscow, is there reason to be concerned about an interruption in gas supply from Russia?
In Europe, we spend €1 billion per day importing fossil fuels from around the world. Despite efforts to increase clean sources of energy such as wind and solar, natural gas plays an important role in the European economy, accounting for a quarter of all our energy needs. Russian gas meets about one third of energy needs, with the remainder coming from Norway, the Netherlands and North Africa. During the recent cold snap, natural gas surged from pipelines across Siberia to heat European homes and business and generate electricity across the continent.
Germany is by far the largest customer of Russian gas and is connected directly to Russia via the Nord Stream gas pipeline which runs 1000 km along the floor of the Baltic Sea. This week, plans to add another pipeline (Nord Stream II) were advanced underpinning the importance of gas infrastructure to the country.
Ireland has a strong reliance on natural gas, both for electricity generation and heating. Before the Corrib gas field became operational last year, Ireland was a net importer of gas from the UK. The UK sources natural gas from a wide number of places and is less reliant on Russia as a single provider. It is expected that Ireland will return to being a net importer in the coming years and will look to the UK as a transit country for most of our future gas needs.
The impact of a long term interruption of Russian gas into Europe was studied in detail by our group in UCC. We used a computer model of the EU energy system to understand what would happen in each country if gas from Russia was not available.
We found that the actual impact would be small for a number of reasons. Since previous supply interruptions through the Ukraine in 2008, there has been a big push to improve pipeline infrastructure in mainland Europe. Traditionally natural gas within Europe flowed from east to west following the established supply routes from Russia into eastern and central Europe. Improved infrastructure allows gas to be moved in multiple directions. This enables Europe to make better use of existing supplies from Norway, Asia and North Africa and provides a strong resilience to the system in times of interruption.
Any shortages or prolonged interruption in supply could lead to higher electricity prices of about 10 percent
Whereas geography binds EU pipelines to gas market in Russia, natural gas can also be transported today by large special ships allowing gas to be moved all over the world. This is called liquefied natural gas (LNG). Europe has significant potential to import LNG into places like the UK, Spain and France and this availability also helps to mitigate against interruptions in supply. Ireland currently does not have LNG capacity, but Minister for Communications, Climate Action and Environment Denis Naughten has mentioned that this could be reconsidered in light of Brexit and Ireland’s reliance on the UK as an import route for gas.
Our research showed that while gas would still flow across Europe in the event of an interruption, any shortages or prolonged interruption in supply could lead to higher electricity prices of about 10 percent as gas would need to travel further to reach the demand centres. Ireland would not be immune from these increases as it would have to compete with others for gas supply.
While geopolitics may have an impact on gas prices across Europe, concerns of a major interruption are misplaced. In short, it is the more mundane things like cold weather in the UK (driving up gas demand) which have a more significant impact for us in Ireland. Energy and geopolitics are inextricably linked, but the weather matters too.
The views expressed here are those of the author and do not represent or reflect the views of RTÉ