Gas stocks in the European Union (EU) have reached 97.89 %, according to Gas Infrastructure Europe (GIE), the highest level in the history of observations. Kirill Rodionov, an expert at the Institute for the Development of Technologies in the Fuel and Energy Complex, explained to Izvestia on October 16 that the record reserves in Europe's underground gas storage facilities (UGS) are linked to raw material savings.
"The high gas stocks in Europe's underground gas storage facilities are linked to the raw material savings agreed by EU countries in the summer of 2022. The savings mainly affect the electricity sector. According to the Ember think tank, electricity production at gas-fired thermal power plants (TPPs) in the European Union has decreased by 13 % in the first seven months of 2023 compared to the same period last year," the expert noted.
According to him, in absolute terms, gas-fired thermal power plants reduced electricity production by 39.7 terawatt hours - comparable to the volume of annual electricity consumption in Denmark.
"As a result, the share of gas in the EU's electricity generation mix has decreased from 19.3 % in January-July 2022 to 17.5 % in the first seven months of 2023," he elaborated.
The expert also pointed out that gas savings have also affected the industry. This is indirectly illustrated by the dynamics of industrial production.
"According to Eurostat, August 2023 was the sixth month in a row in which euro area countries recorded a decline in industrial production compared with the same period of the previous year. The main losses from gas savings are borne by nitrogen fertilizer producers, who use gas as a raw material," Rodionov said.
The expert believes that fuel savings have allowed European countries to increase their underground gas storage despite reduced imports. He cited data from the European Network of Transmission System Operators for Gas (ENTSOG), which showed that gas imports into the European Union fell by 18 % in the first seven months of 2023 compared to the same period last year.
"The main role was played by the reduction in pipeline deliveries from Russia, which, based on the results for the first seven months of 2023, decreased by 38.7 billion cubic meters. m. Meanwhile, pipeline gas supplies from Norway, Denmark, the UK, Azerbaijan and North African countries decreased by a total of 3.4 billion cubic meters. m over the same period, and liquefied natural gas (LNG) supplies increased by only 1.7 billion cubic meters. m," Rodionov noted.
He also said that gas savings had also led to lower prices. Thus, in September 2023, the average gas price at the key TTF hub in Europe was $413 per thousand cubic meters. m - that is more than five times less than in September 2022 ($2,116 per thousand cubic meters), the expert specified.
"Despite the risks of a price increase in winter, prices will not return to the highs of summer 2022," Rodionov concluded.
(ISSUES/USA)
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