Gas storage vies for central role in EU quest for carbon neutrality

In the long-run, gas storage facilities could provide a platform to store low-carbon gases like green hydrogen generated from wind and solar power as well as biomethane produced locally from agricultural waste. [Shutterstock]

This article is part of our special report Gas storage in the energy transition.

European gas storage sites have much to offer in the energy transition, providing a readily available platform to carry new low-carbon gases like hydrogen. What’s not clear yet is whether those gases can be produced in sufficient quantity to significantly cut carbon emissions.

The gas industry pitches its 1,200 terawatt hours (TWh) of available storage capacity as a potential benefit to Europe’s future low-carbon energy system.

“The question, of course, is what we’re going to put in that infrastructure over time,” said James Watson from Eurogas, an industry association. “And this is one of the questions we will need to get our heads around and really work hard to achieve,” he told participants at a recent EURACTIV event.

In the short term, gas storage sites can help decarbonise the power sector by providing seasonal storage during winter. They also provide an essential back-up for variable renewable electricity throughout the year. In the long-run, they could provide a platform to store low-carbon gases like green hydrogen generated from wind and solar power as well as biomethane produced locally from agricultural waste.

The problem is, estimates vary widely as to the sector’s ability to deliver those clean gases in the quantities needed to support Europe’s goal of reaching net-zero emissions by 2050.

A recent industry-funded study has put the potential production of renewable gases at 270 billion cubic meters (bcm) per year by 2050, up from 122bcm on projections published the year before. The German industry association BDI even sees potential to import massive amounts of green hydrogen from sunny places like Australia, to the tune of 340TWh per year by 2050.

Researcher: 100% renewable energy requires ‘a lot of green hydrogen’

The production of so-called green hydrogen from wind and solar electricity is seen as a potential game-changer for the transition to a 100% renewable energy system. But getting there will take some time and some intermediary solutions will be needed, says Daan Peters.

Decarbonisation target

Those projections are dismissed as exaggerated by environmental organisations, which came up with their own studies to dampen industry claims. And even the European Commission seems unconvinced by the multiplication of industry studies.

“I have never believed in all the studies,” said Klaus-Dieter Borchardt, a German national who is deputy director general the European Commission’s energy department. Although each study brings something valuable, their assumptions are often “not the ones we as policymakers would use,” he told participants at the EURACTIV event, held last month.

“What really matters is what we want to achieve – and that is decarbonisation,” Borchardt stressed, referring to transport, building and agriculture sectors, which are currently not covered by the EU’s carbon pricing system, the Emissions Trading Scheme (ETS).

“I think we should agree on a decarbonisation target for all this,” he told participants at the event. “And then you can develop the most suitable solutions,” he added, saying “that can be biomethane, green hydrogen or blue hydrogen” depending on the carbon footprint and different end-uses for these new types of gases.

Still, the issue of volume remains the biggest question mark. “Renewable gases – biogas, biomethane and hydrogen – are still in limited supply at the moment,” says Ilaria Conti, head of gas programme at the Florence School of Regulation.

“So one of the first things, is to evaluate the real potential of these renewable and low-carbon gases,” she told EURACTIV in an interview.

Taking biogas as an example, Conti said production is currently very limited, representing only 1% of energy use in a country like France. “Some estimations indicate that in a couple of years, this could go up to 10%. And even though it’s a big increase, it’s only a small percentage of the total energy consumption” in France, Conti remarked.

Eurogas has called for the introduction of a binding target for renewable and decarbonised gases, saying it will help bring higher production volumes to the market, like was done in the past for renewables in the electricity sector.

But EU officials have voiced doubts about the idea, saying a distinction must be made between the different types of gases, according to their varying carbon footprint.

The European Commission hasn’t made up its mind yet on the type of incentives scheme it wants to apply, and is looking into all options in view of its forthcoming Gas Package of legislation, expected to be tabled next year.

EU wary about one-size-fits-all target for ‘clean gas’

Setting a target for low-carbon gases such as hydrogen or biomethane is going to be tricky even though the idea is supported by industry, a senior EU official has said, warning against a one-size-fits-all approach.

On the industry side, some are arguing for a regional approach to help bring the volumes up.

Groups of countries or regions should be encouraged to tap into the whole range of low-carbon energy sources at their disposal – whether biomethane in France or wind energy fuelling power-to-gas installations in Nordic countries, said Torben Brabo, the CEO of Danish gas TSO Energinet.

“Developments won’t happen everywhere at the same speed or using the same technologies,” Brabo pointed out, calling on regulators to leave enough flexibility for local and regional solutions to emerge.

“Regional developments should be preferred to a single uniform EU-wide approach,” Brabo said.

Tracing the origin of gas

One of the key challenges for policymakers will be to find a way of tracing back the origin of these new low-carbon gases – and measure their carbon footprint.

The industry believes that can be achieved by putting in place certificates of origin, similar to what is currently done for wind and solar power in the electricity sector.

Digitalising infrastructure can also help. “By adding sensors in the infrastructure, you can know instantly what kind of gas is in the system. And that data can be shared with customers and other market players,” says Jan Ingwersen, from ENTSOG, the European Network of Transmission System Operators for Gas. “So we’re talking about a major digitalisation effort,” he told EURACTIV in a recent interview.

German industry eyes massive imports of ‘green hydrogen' from Australia

Huge amounts of synthetic fuels generated from renewable energies will be required to fully decarbonise the German economy, according to industry association BDI, which eyes yearly imports of 340 terawatt hours (TW/h) by 2050 – the equivalent of Germany’s entire power fleet.

Silver bullets and unicorns

But while all options are open, EU regulators and environmental groups say the overarching decarbonisation objective should remain paramount.

“We shouldn’t focus on delivering green gas at any cost,” said Milan Elkerbout, a researcher at the Centre for European Policy Studies (CEPS) in Brussels. What matters most, he said, is to look at the end-use sectors that need to be decarbonised and, from there, assess the options available. And green gases will be attractive in some cases, but not always, he said.

“We have to stop looking for silver bullets and unicorns,” added Lisa Fischer from green think tank E3G, pointing out that most studies to date have tended to focus on electricity and gas in isolation, pitting one against the other, without looking at synergies.

“What we haven’t really had is a conversation that honestly looks at all the different solutions” available to decarbonise sectors like heavy industry, Fischer said. And potential solutions there exist also on the electricity side, she pointed out, citing demand-side response, grid interconnection and energy efficiency measures.

Klaus-Dieter Borchardt agreed on that point, warning the gas industry against the “mistake” of developing solutions in silos, without looking at other sectors like electricity.

“You have to take a look at the full energy system,” Borchardt said, citing energy efficiency, demand-side management as well as the development of energy storage solutions. “We should not make the mistake of trying to find a niche for gas,” he added, but rather integrate gas into a wider energy system which puts decarbonisation as the overarching objective.

Study charts six scenarios for fossil-free energy by 2050

Cutting energy use in buildings, ramping up renewable electricity and developing large-scale storage with hydrogen are clear options in bringing energy emissions down to zero by 2050, according to a new study published on Thursday (14 March).

Identifying end-consumers

“The next mistake,” Borchardt warned, would be to develop green gases without the end-consumer in mind. “Especially when it comes to specialised gases, you can only develop them together with the appliances or the end-consumers,” the EU official said.

Once end-consumers are in the picture, the legal framework will fall into place naturally, he suggested, accepting that solutions will differ from one country to the other. “And based on that, we will find common rules, a common framework.”

“Because I do not believe that with hydrogen or renewable gas, we will have widespread distribution, like for natural gas. It will be local, it will be regional, it will be where the consumption takes place,” Borchardt said, adding: “we won’t have positive effects if we believe that we will send hydrogen over long distances”.

The evolving role of gas storage in Europe

Departing from its usual supply security role, gas storage is vying for a central position in Europe’s vision of a hybrid energy system combining renewable electricity and low-carbon gases like hydrogen. But getting there won’t be a smooth run and regulators are watching closely.

Subscribe to our newsletters