Most of the 32 gas projects included on the fourth list of projects of common interest (PCI) are unnecessary from the point of view of the European Union’s security of energy supply and represent a potential overinvestment of several tens of billions of euros, according to a study published on Monday 20 January by Artelys, a consultancy firm active in the energy field.
This study evaluates the combined cost of these 32 projects at 29 billion euros, some of which would be borne by the European Union, since PCIs enjoy a number of advantages, in particular eligibility for European funding from the Connecting Europe Facility (CEF).
According to Artelys, the development of these 32 projects would increase the capacity of the EU’s natural gas infrastructure network by 338 GW. However, the existing pipelines and terminals for liquefied natural gas already represent a capacity of around 2000 GW, the company adds.
The study also points out that meeting the 2030 climate and energy targets will lead to a 29% reduction in the volume of natural gas, from 415 bcm in 2015 to 297 bcm in 2030, according to current European Commission projections.
On the basis of these data, Artelys considers that the existing EU gas infrastructure is fully capable of meeting various scenarios of future gas demand, even in the event of extreme supply disruptions.
Therefore, the organisation considers that investments in gas projects on the fourth PCI list would be “unnecessary to safeguard security of supply in the EU and therefore risk to become stranded assets supported by European Union public funds”.
When questioned by the press at the traditional midday meeting, the European Commission did not wish to provide a reaction to the study as such. However, the institution recalled the important role of gas “as a transition fuel”, while stressing the need to invest in infrastructure that in the future will be “ready to support” low-carbon gases as a substitute for natural gas.
MEPs on the Industry, Research and Energy Committee (ITRE) remain unconvinced about this list, adopted by the Commission on 31 October 2019 (see EUROPE 12361/12), mainly because of the prominence of gas projects, which some consider too significant (see EUROPE 12384/12, 12351/11).
After having asked to extend the period of examination for the list by a further two months, the ITRE Committee will finally decide whether to approve the list on Wednesday 22 January.
To consult the study: https://bit.ly/2udhIsP (Original version in French by Damien Genicot)