The Green Brief: The future of gas

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Greetings and welcome to EURACTIV’s Green Brief. Below you’ll find the latest roundup of news covering energy & environment from across Europe. You can subscribe to the weekly newsletter here.

Europe’s love affair with gas started around the North Sea in the 1950s with discoveries in the UK and the Netherlands. This is also where the industry’s future lies.

Today, priorities have changed, and fossil gas is being phased out. Production at Europe’s biggest gas field in Groningen will be halved by 2022 and cease entirely by 2030, the Dutch announced in 2018.

With decarbonisation now the top priority, the North Sea could witness the dawn of a new era for gas – this time centred on green hydrogen production powered by offshore wind.

This week, on the North Sea shores of Copenhagen, three EU countries signed agreements to utilise renewable power from offshore wind.

Belgium and Denmark signed an agreement for the world’s first undersea connection between two artificial energy islands. This would allow power exchange between the countries and transport electricity from offshore wind farms to the mainland.

“Our Belgian target is to triple offshore wind capacity by 2030. We will make sure that we can supply every Belgian household with North Sea electricity,” said Tinne van der Straeten, Belgium’s energy minister.

Germany also signed an agreement to increase the use of the North Sea for renewable energy.

Over the coming years, the European Commission expects a huge boost in renewables. By 2030, it wants to double the amount of renewable energy in Europe’s mix – from 20% to 40%. Offshore wind is expected to play a big part in this, with the EU aiming to reach 60 GW by 2030 and 300 GW by 2050, up from 23 GW currently.

Some of that wind power capacity is being reserved for the production of green hydrogen.

Last year, a consortium of Danish companies, including Ørsted and Copenhagen Airport, joined forces to develop a hydrogen and sustainable transport fuel facility in the heart of the Danish capital. The project would include constructing a 10 MW electrolyser in 2023 and a further 250 MW electrolyser in 2027, powered by the nearby  Bornholm offshore wind farm.

Earlier this year, RWE, Shell, Gasunie and Equinor teamed up to install approximately 300 MW worth of electrolyser capacity to produce up to 20,000 tons per year of green hydrogen offshore.

The hydrogen will be transported via pipeline to the German North Sea archipelago of Heligoland starting in 2028. If that proves successful, something bigger could follow, with up to 10 GW of green hydrogen produced offshore by 2035. This would be transported via pipeline to mainland Germany.

The European Commission is now preparing the next steps, with the expected publication of a gas package in December, including new rules for developing a European hydrogen market and a dedicated pipeline network.

Greens have baulked at a leaked version of the plan, warning that hydrogen networks risk being overwhelmingly reliant on fossil gas for the foreseeable future.

This may be true in some places. But what’s happening in the North Sea will hopefully prove them wrong.

– Frédéric Simon and Kira Taylor


This week’s top stories

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News from the capitals

WARSAW. Expert: Carbon farming ideal for boosting Poland’s yields. Carbon farming practices could help Polish farmers cope with permanent drought as they could increase the productivity of their yields, an expert has told EURACTIV Poland. Read more.

BERLIN. German coalition talks: coal exit pulled forward, gas boilers to be outlawed. The first-ever three-way government coalition negotiations are due to be concluded in Berlin as the Greens obtain last-minute concessions such as a sped-up coal phase-out. Read more.

ATHENS. Commission mulls EU north-south ‘firefighters exchange’ to tackle natural disasters. The European Commission is considering a pilot project under the name “prepositioning” to be implemented for the first time in Greece next summer. Forest firefighters from Europe’s north, such as Sweden, will settle in Greece and other countries facing major wildfires during the summer months. Read more.

SARAJEVO. Coal miners on strike, halt production in all mines. Several hundred miners gathered in front of the seat of the government of the Federation of BiH (Bosniak and Croat entity), expressing discontent over the employment conditions and warning they would not leave the site until their demands were met. The miners halted production in all seven coal mines on the day of the strike. Their demands include setting the minimum wage at €500, bridging the years of service, and full implementation of the collective agreement. (Željko Trkanjec | EURACTIV.hr)

ZAGREB. Polish PM: EU dependence on Russia will increase with Nord Stream 2. Europe’s dependence on Russian gas will increase once controversial Nord Stream 2 pipeline becomes operational, Polish PM Mateusz Morawiecki said on Tuesday after a meeting with his Croatian counterpart Andrej Plenković in Zagreb. Moreover, the Polish PM hinted at a broader Russia-led plan which also involves the Balkan region. Read more.

BERLIN. Germans close to forming government with a ‘green’ veto right. As negotiations in Berlin over Germany’s first-ever three-way government continue, their ambitious timeline may be back on track. The rumour mill, previously busy with dubious “leaked” lists showing which people will take ministries, has now turned towards Tuesday when a big announcement is said to be due. Read more.

TIRANA. Albania spent €213 million on importing energy in 2021 so far. The Albanian government imported €213 million of energy between January and November of this year despite proudly announcing that Albania is powered by 100% hydropower. Read more.

HELSINKI. Finnish startup leads way in producing food without use of land, livestock. Solar Foods, a startup born in 2017 out of the research project by VTT Technical Research Centre and LUT University in Eastern Finland, has come up with a method to produce sustainable and pure single-cell protein from carbon dioxide and electricity without the use of land and livestock. Read more.

TIRANA. Albania to impose big penalties on polluters. Those found throwing litter or dumping waste in Albania will now face high fines according to Prime Minister Edi Rama, although proper waste collection and recycling remains unavailable.  Read more.

Finland will vote against EU climate delegated act. Finland will vote against the EU’s climate delegated act later this year because some aspects of the classification system for sustainable activities, known as taxonomy, concerning forest management are “difficult to understand and open to interpretation”, the government said in a press statement on Wednesday. Read more.

MADRID. Timmermans in Madrid: EU to move forward with ‘zero pollution’ targets. The EU should move forward towards the objective of an “ambitious zero pollution” target because improving air quality in all European cities will bring “happiness” to citizens, Frans Timmermans, the European Commission vice president in charge of the Green Deal, said at the third EU Clean Air Forum in Madrid on Thursday. Read more.

MADRID. Deteriorating air quality linked to La Palma volcano prompts school closures, flight cancellations. The volcanic eruption on the Spanish island of La Palma eased on Wednesday (17 November), but air quality is seriously deteriorating, prompting school closures and flight cancellations. Experts said there was still no indication of when it will come to a complete end, EURACTIV’s partner EFE reported. Read more.

BUCHAREST. Romanian minister: Natural gas crisis provoked by Russia. The natural gas crisis is an artificial crisis created by the Russian Federation, through Gazprom, Romania’s interim energy minister Virgil Popescu told a business conference on Wednesday. Read more.


News in brief

Brussels aims to become zero-waste.  Brussels on Tuesday (23 November) became the first Belgian city and the first capital in Northern Europe to join the European Zero Waste City Charter. Alain Maron, Brussels’ Minister for the Environment and Climate Transition, signed the charter on Tuesday (23 November), adding the Belgian capital to the list of 445 cities and municipalities across the continent. that have joined the Zero Waste Cities network. 

The Region’s zero waste strategy includes a commitment to reduce waste by 20% per capita by 2030. By the end of 2022 bio-waste separate collection will be mandatory for households and enterprises, a decision which comes on the heels of measures effective since January to extend the types of plastic collected in the city’s famous blue bags. Among other commitments, cities in the network aim to reduce the amount of waste incineration by a factor of four.

Alain Maron said: “Having just returned from COP26, I am even more convinced of the importance of drastically reducing the impact of our consumption. We are working on changing behaviour at source, with our citizens, with our administrations, but also with our companies.” (Frédéric Simon | EURACTIV.com).

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Export finance to fossil fuels continues, despite COP26 commitment. On Wednesday (23 November), the Export Finance for Future (E3F) Coalition — Denmark, France, Germany, the Netherlands, Spain, Sweden and the United Kingdom — are gathering for a virtual ministerial to discuss how to align their export finance with climate goals. 

At COP26 in Glasgow 39 countries and institutions launched a joint statement on ending public finance for fossil fuels by the end of 2022 and instead prioritising public finance for clean energy. 

This declaration now rings hollow, however. A policy brief released on Tuesday by Oil Change International and Overseas Development Institute shows that despite their commitment to align financial flows with the Paris climate goals, the E3F countries still provided €19 billion in export finance for fossil fuel projects abroad between 2018 and 2020. This was significantly higher than their support for clean energy projects (€16.5 billion).

The largest providers of fossil fuel financing were Spain, Germany and the UK, providing €6.2, €5 and €3.7 billion between 2018 and 2020, followed by the Netherlands and France, which provided €2.6 billion and €885 million during the same period. Denmark and Sweden have provided the highest levels of clean energy finance, at €6.6 and €6.7 billion between 2018 and 2020. (Frédéric Simon | EURACTIV.com).

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Third time lucky for TEN-E trilogue? The third round of negotiations on rules deciding which cross-border energy infrastructure can be granted priority status took place on Tuesday evening (23 November), but no deal was reached and there are still some key issues that need to be solved.

“I am hopeful that this will be the final trialogue and that we will reach a compromise tonight,” Erik Bergkvist, the Parliament negotiator for the Socialists and Democrats (S&D) told EURACTIV before the trilogue began. “Our delegation from the Parliament is ready to work all night if necessary. The mandate from the Parliament is progressive and strong and we have a clear and fossil free ambitions in tonight’s negotiation.”

“The agenda is ambitious, but I believe the discussions will centre around governance, where the Parliament is working for increased transparency in regards to the projects that are granted EU-funding,  as well as fossil gas. The Council have a less ambitious stance on fossil gas, from the Parliament we are doing what we can to keep fossil gas out of the TEN-E.”

But despite his optimism, negotiators will have to meet again at a so far undecided date to continue discussing the rules. That means we’re yet to see what decision has been made on granting priority status to gas infrastructure.

There are also issues with countries, primarily France, blocking offshore wind infrastructure that could allow cooperation between countries, according to Claude Turmes, energy minister for Luxembourg. (Kira Taylor | EURACTIV.com)

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Residential battery storage set for exponential growth. The European market for solar and battery storage is set to grow over 400%, from 3 GWh installed storage capacity in 2020 to 12.8 GWh in 2025, according to projections from SolarPower Europe, a trade association.

SolarPower Europe’s ‘European Market Outlook for Residential Battery Storage’ report, published on Tuesday (23 November) analysed the synergy between residential solar and batteries. According to the report, European residential solar and storage grew by 44% to 140,000 installed units in 2020, the first time that new installations reached the 100,000 threshold in a 12-month period.

Germany is clearly in the lead, and was responsible for 70% of the newly installed storage capacity. The Top 5 markets together, Germany, Italy, UK, Austria, and Switzerland, installed 93% of new European solar and storage. (Frédéric Simon | EURACTIV.com).

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Gas leaks. As more people in Brussels get their hands on leaked drafts of the gas package, due in December, the reactions keep rolling in.

Christian Ehler, a member of the centre-right European People’s Party welcomed the focus on using gas to help decarbonise the economy. The devil will be in the details, but the fact that the European Commission recognises the importance of low-carbon energy, from both gas and hydrogen, in the transition to a green economy is important, he told EURACTIV.

“Our industry needs certainty about its energy supply and a clear pathway for its transition,” he said, adding that the package “really has to facilitate the integration of renewable and low-carbon gases in the exiting gas grid and enable the development of dedicated hydrogen infrastructure and market, allowing hydrogen to become a key component of the energy sector”.

But other lawmakers are more concerned about the role fossil gas plays in the package. “This gas package of the EU Commission is a “carry on” with the previous energy policy. With this proposal, the Commission is pandering to the interests of the gas lobby instead of finally committing to a clear path out of fossil energies,” Green MEP Michael Bloss told EURACTIV. (Kira Taylor | EURACTIV.com)


Opinions


Upcoming events

8 DECEMBER. Energy poverty: how to reduce inequalities? Join Adela Tesarova, Head of Unit, Consumers, Local Initiatives and Just Transition, DG Energy, European Commission, Masha Smirnova, Campaign Manager European Green Deal, EUROCITIES and more  to discuss how addressing energy poverty can help reduce inequalities in the European Union and the role that Member States should play in protecting vulnerable citizens. Programme and registration here. (Supported by PKEE)

8 DECEMBER. EU taxonomy for sustainable activities – should nuclear energy be left out? Join Thomas Pellerin-Carlin from the Jacques Delors Institute and other speakers to discuss the role of nuclear power in the green transition. Programme and registration here. (Supported by REplanet)


On our radar

1 DECEMBER: Possible release of EU sustainable finance taxonomy delegated act. EURACTIV understands that the European Commission could unveil the delegated act of its sustainable finance taxonomy on Wednesday (1 December) – one day before EU energy ministers are due to meet in Brussels. 

2 DECEMBER: Energy Council. EU energy ministers will meet in early December in the second session since the Fit for 55 package was tabled. (meeting page). 

14 DECEMBER: Energy, climate, transport and nature protection package. Following the publication of its huge package of climate proposals in July, the European Commission is expected to table more energy-related files, including regulations on natural gas, and proposals on the circular economy. It will also put forward proposals on nature protection. See the full list here:

Climate and energy:

  • Reducing methane emissions in the energy sector
  • Revision of the third energy package for gas
  • Revision of the energy performance of Buildings Directive
  • Commission communication: Restoring sustainable carbon cycles
  • Council Recommendation to address the social and labour aspects of the climate transition

Efficient and green mobility package:

  • Revision of the Regulation on the trans-European transport network
  • Revision of the Directive on Intelligent Transport Systems
  • New EU urban mobility framework
  • Rail freight corridors initiative

Nature:

  • Protecting biodiversity: nature restoration targets
  • Improving environmental protection through criminal law

16-17 DECEMBER. EUROPEAN COUNCIL. EU leaders will meet once again and energy prices are back on the agenda. This time, however, it will be after the gas package has been tabled.

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