IAE analysis of EU natural gas storage and consumption Nov - Mar

Investment Analysis Clubs Macro Economic Trends and Risks
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IEA conducted a resilience analysis of the EU’s gas market in the case of a complete Russian supply shutdown starting from 1 November 2022. The analysis shows that without demand reductions in place and if Russian pipeline supply is completely cut, EU gas storage would be less than 20% full in February, assuming a high level of LNG supply – and close to 5% full, assuming low LNG supply. Storage falling to these levels would increase the risk of supply disruptions in the event of a late cold spell. A reduction in EU gas demand through the winter period of 9% from the average level of the past five years would be necessary to maintain gas storage levels above 25% in the case of lower LNG inflows. And a reduction in demand of 13% from the 5-year average would be necessary through the winter period to sustain storage levels above 33% in the case of low LNG inflows. Therefore, gas saving measures will be crucial to minimise storage withdrawals and keep inventories at adequate levels until the end of the heating season.

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A related bit of news…
Olaf Scholz in Germany decided to keep three nuclear power plants in service through this winter. This will lessen natural gas demand in the power sector, making more gas available for people’s homes and businesses. The decision to keep all three plants in service goes against the Green party position.

  • Pete
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However, Vice Chancellor and Economy Minister Robert Habeck of the Green Party on Monday said he accepted the fact that Scholz had overridden others in the Cabinet.

The chancellor has asked the Economy, Environment and Finance Ministries to create the legal basis for the plants to remain open.

“The legal basis will be created to allow the operation of the nuclear power plants Isar 2, Neckarwestheim 2 and Emsland beyond December 31, 2022, until April 15, 2023,” Scholz said in a statement.

Scholz also requested that the ministries present an “ambitious” law to increase energy efficiency, as well as a binding agreement to phase out coal by 2030.

Germany planned to complete a phaseout of nuclear power by the end of 2022, but a energy supply crunch following Russian gas cuts has caused lengthy debate over keeping nuclear power plants at the ready.

Jaak

P.S. - Chancellor Scholz and his SPD party has for years also wanted to end nuclear power in Germany.

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