Europe Can Cease Its Reliance on Russian Gas Imports by the End of 2025
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March 23, 2022
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In this white paper, we look at a set of measures that would enable Europe to cease (or reduce) its reliance on the Russian gas. Although it is impossible to achieve by the end of the 2022, by the end of 2025, Europe could cut most of the Russian gas imports by debottlenecking gas infrastructure, accelerating renewables deployment, increasing local and foreign gas supply from existing partners.
Today, gas is the second largest source of energy in the European Union (EU), representing 24% of total energy consumption, significantly higher than all renewable energy sources combined (18%).
The EU’s domestic production has been in decline from nearly 30% of the total gas supply in 2011 to only 14% in 2019, whilst the EU’s gas imports dependency on Russia increased from 32% in 2011 to 38% of the total imports in 2019.
Additionally, European gas prices increased strongly between early 2021 to early 2022 due to limited available LNG liquefication export capacity and lower than expected import volumes through Russian pipelines, combined with significant gas demand growth in Asia. The upward pressure on gas prices has been further compounded by the fear of Russian supply cuts as a result of the war in Ukraine.
Cutting the 166 billion cubic meters (bcm) of Russian gas imports, as measured in 2019, is not feasible by the end of 2022, even if Europeans import as much as possible from around the world, re-open available nuclear or coal power plants and reduce their heating. A significant gap of 36% of the original supply would still remain, potentially triggering closure of factories and buildings unable to function.
In the medium-term (by the end of 2025), however, the EU could cut most of Russian gas imports. This could be achieved by addressing bottlenecks in the European gas infrastructure to allow non-Russian gas to reach its Eastern parts, increasing domestic and foreign gas supply from nations other than Russia, extending life of nuclear and coal power plants, and accelerating renewable energy deployment. All these measures combined would help cut the demand for Russian gas by 87% (144 bcm). A gap of 22 bcm (13% of the Russian supply) remains. It could be further reduced by an accelerated deployment of heat pumps, revisiting EU shale gas bans and installing more batteries to increase renewable electric generation penetration.
Published
March 23, 2022
Key Contacts
Senior Managing Director