Scope for EU–Japan cooperation in decarbonising the global LNG market
DOI:
https://doi.org/10.26485/SPE/2022/124/7Keywords:
LNG, international trade, decarbonisationAbstract
Background: Global climate ambitions seem to be at odds with the future use of natural gas. However, the inability to fully electrify the demand for energy has forced developed economies to seek ways to decarbonise the gas industry. This article investigates the option to further use LNG terminals as a source of carbon-neutral energy supply for the EU and Japan, which together account for 50% of the global demand for LNG.
Research purpose: The aim of this paper is to verify the potential pathways toward continued utilisation of the EU and Japanese LNG infrastructure in a low-carbon or even climate-neutral future.
Methods: A literature review of different technologies that enable CO2-neutral gas production or imports is conducted to identify potential pathways for decarbonisation. A SWOT analysis of the two selected scenarios is then performed to present their upsides and downsides and to identify potential areas for cooperation. Finally, the costs associated with the two development paths are analysed to verify where the main challenges lie.
Conclusions: The study confirms that the success of gas conversion facilities will rely heavily on technological advancements that would reduce the unit cost of natural gas processing. By contrast, biomethane imports will require operational support to effectively compete with other energy carriers. The author concludes that both gas decarbonisation scenarios analysed may well prove to be complementary. However, access to financing will likely pose a major challenge to the future utilisation of the existing LNG infrastructure
Downloads
References
Adesina E., Asante B., Camba N., Delano F., Donohoe R., Fulford N.J. et al., Global LNG Fundamentals, Book Sprint, Washington D.C. 2017, pp. 1–231.
Algell J., LNG in Kenya – SSPA supports the introduction of LNG into East Africa, SSPA, Stockholm 2020, pp. 1–2.
Al-Qahtani A., Parkinson B., Hellgardt K., Shah N., Guillen-Gosalbez G., Uncovering the true cost of hydrogen production routes using life cycle monetisation, Applied Energy 2021/281, pp. 1–12.
Antonini C., Treyer K., Streb A., van der Spek M., Bauer C., Mazzotti M., Hydrogen production from natural gas and biomethane with carbon capture and storage – A techno-environmental analysis, Sustainable Energy & Fuels 2020/4, pp. 2967–2986.
Becker W., Penev M., Braun R.J., Production of Synthetic Natural Gas from Carbon Dioxide and Renewably Generated Hydrogen: A Techno-Economic Analysis of a Power-to-Gas Strategy, Journal of Energy Resources Technology 2019/141, pp. 1–11.
Brandle G., Schonfisch M., Schulte S., Estimating Long-Term Global Supply Costs for Low- Carbon Hydrogen, EWI Working Papers, Koeln 2020, pp. 1–60.
Catuti M., Egenhofer C., Elkerbout M., The future of gas in Europe: Review of recent studies on the future of gas, CEPS Research Report 2019/03, pp. 1–33.
Dagle R., Dagle V., Bearden M.D., Holaday J.D., Krause T.R., Shabbir A., An Overview of Natural Gas Conversion Technologies for Co-Production of Hydrogen and Value-Added Solid Carbon Products, EERE and Transportation Office. Fuel Cell Technologies Office, Washington D.C. 2017, pp. 1–73.
ERIA, Investment in LNG Supply Chain Infrastructure Estimation, in: T. Uemura, K. Ishigami (eds.), Formulating Policy Options for Promoting Natural Gas Utilization in the East Asia Summit Region Volume II: Supply Side Analysis, Jakarta, pp. 1–80
Ferella F., van der Broeke L.J.P., An integrated approach for the generation of renewable Energy from biomass and waste streams, “10th Conference on Sustainable Development of Energy, Water and Environment Systems”, Croatia 2015, pp. 1–18.
Gardner D., LNG shipping, in: P. Griffin, Liquefied Natural Gas. The Law and Business of LNG, Global Law and Business Ltd., Surrey 2017, pp. 7–28.
Herdzik J., Methane slip during cargo operations on LNG carriers and LNG-fueled vessels, New Trends in Production Engineering 2018/1 (1), pp. 293–299.
Hrbek J., Status report on thermal gasification of biomass and waste 2019, “IEA Bioenergy Task 33 Special Report”, Paris 2019, pp. 1–125.
IGU, Global Renewable and Low-Carbon Gas Report, IGU, Barcelona 2021, pp. 1–49.
IGU, Natural Gas Conversion Pocketbook, IGU, Barcelona 2012, pp. 1–40.
IGU, World LNG Report, IGU, Barcelona 2020, pp. 1–68.
IGU, World LNG Report, IGU, Barcelona 2021, pp. 80–93.
International Energy Agency, The future of hydrogen, IEA, Paris 2019, p. 42.
International Energy Agency, Japan 2021 Energy Policy Review, IEA Publications, Paris 2021, pp. 1–231.
International Energy Agency, LNG Market Trends and Their Implications, IEA Publications, Paris 2019, pp. 2–6.
International Energy Agency, Outlook for biogas and biomethane, IEA Publications, Paris 2020, p. 68.
IRENA, Biogas for road vehicles: Technology brief, International Renewable Energy Agency, Abu Dhabi 2018, pp. 1–62.
Javid M., Shahmoradi E., Risk Management in LNG Shipping Arrangements, Oil, Gas & Energy Law Intelligence 2016/4, pp. 1–18.
Kusakana K., A Review of Energy in the Democratic Republic of Congo, “ICDRE Conference”, Denmark 2016, pp. 1–10.
Lont P., Competition on the LNG market – consequences for the EU, Prace Naukowe Uniwersytetu Ekonomicznego we Wrocławiu 2020/64 (6), pp. 127–141.
Melling A.J., Natural gas pricing and its future. Europe as the battleground, Carnegie Endowment for International Peace, Washington D.C. 2010.
Nevzorova T., Kutcherov V., Barriers to the wider implementation of biogas as a source of energy: A state-of-the-art review, Energy Strategy Reviews 2019/26, pp. 1–12.
Oehmichen K., Nauman K., Postel J., Drache C., Braune M., Gröngröft A. et al., Technical principles and methodology for calculating GHG balances of Biomethane, DFBZ, Berlin 2016, pp. 1–52.
Olanrewaju F.O., Andrews G.E., Li H., Phylaktou H.N., Bioenergy Potential in Nigeria, Chemical Engineering Transactions 2019/74, pp. 61–66.
Popp J., Lakner Z., Harangi-Rakos M., Fári M.G., The effect of bioenergy expansion: Food, energy, and environment, Renewable and Sustainable Energy Reviews 2014/32, pp. 559–578.
Prussi M., Padella M., Conton M., Postma E.D., Lonza L., Review of technologies for biomethane production and assessment of EU transport share in 2030, Journal of Cleaner Production 2019/222, pp. 565–572.
Roberts D., Janssen M., The role of LNG in the energy sector transition. Regulatory recommendations, “Frontier Economics”, London 2020, pp. 1–62.
Robin J., Demoury V., The LNG Industry, “International Group of Liquefied Natural Gas Importers”, Neuilly-sur-Seine 2011, pp. 1–30.
Rogers H., The LNG Shipping Forecast: costs rebounding, outlook uncertain, Oxford Institute for Energy Studies. Energy Insight 2018/71, pp. 1–18.
Rupf G.V., Bahri P.A., de Boer K., McHenry M.P., Broadening the potential of biogas in Sub- Saharan Africa: An assessment of feasible technologies and feedstocks, Renewable and Sustainable Energy Reviews 2016/61, pp. 556–571.
Sarsfield-Hall R., Unger B., Utilizing the versatility of hydrogen to fully decarbonise Europe, “Poyry Decarbonisation Services”, Stockholm 2019, p. 1.
Schneider S., Bajohr S., Graf F., Kolb T., State of the Art of Hydrogen Production via Pyrolysis of Natural Gas, ChemBioEng Reviews 2020/7 (5), pp. 150–157.
SIGTTO, Annual report and Accounts, London 2020, pp. 1–44.
Sullivan H.W., LNG sale and purchase agreements, in: P. Griffin, Liquefied Natural Gas, Global Law and Business, Surrey 2017, pp. 185–213.
Tamburini E., Gaglio M., Castaldelli G., Fano E.A., Biogas from agri-food and agricultural waste of can appreciate agro-ecosystem services: the case study if Emilia Romagna region, Sustainability 2020/12, pp. 1–15.
Timmerberg S., Kaltschmitt M., Finkbeiner M., Hydrogen and hydrogen-derived fuels through methane decomposition of natural gas – GHG emissions and costs, Energy Conversation and Management: X 2020/7, pp. 1–15.
van Cappellen L., Croezen H., Rooijers F., Feasibility study into blue hydrogen. Technical, economic an sustainability analysis, CE Delft, Delft 2018, p. 11.
van Nuffel L., Gorstein Dededeca J., Fischer C., Smit T., Michalski J., Impact of the use of the biomethane and hydrogen potential on trans-European infrastructure, European Parliament, Brussels 2019, pp. 1–119.
van Nuffel L., Gorstein Dedecca J., Smit T., Rademaekers K., Sector coupling: how can it be enhanced in the EU to foster grid stability and decarbonize?, European Parliament, Brussels 2018, pp. 1–64.
van Wijk A.J.M., Wouters F., Hydrogen. The bridge between Africa and Europe, Springer, Berlin 2019, pp. 1–31.
Weiss J., Hledik R., Hagerty M., Gorman W., Electrification. Emerging Opportunities for Utility Growth, The Brattle Group, Boston 2017, pp. 1–27.
World Bank, Introduction of Liquefied Natural Gas (LNG) in Central America, Economic Consulting Associates Ltd., London 2015, pp. 1–240.
Zielińska K., Financial Stability in the Eurozone, Comparative Economic Research 2016/19 (1), pp. 155–175.
http://www.h2data.de; accessed 3.07.2021.
https://gie.eu/index.php/gie-publications/databases/lng-database; accessed 10.07.2021.
https://kenyabiogas.com/about/; accessed 19.08.2021.
https://www.iea.org/data-and-statistics/charts/hydrogen-production-costs-using-natural-gas-inselected-regions-2018-2; accessed 10.07.2021.
https://www.nigerialng.com/Pages/index.aspx; accessed 19.08.2021.
https://www.numo.or.jp/topics/1-1Nakanishi.pdf; accessed 3.07.2021.
https://www.statista.com/statistics/468412/global-lng-tanker-fleet/; accessed 7.07.2021.
