BAKU, Azerbaijan, Nov.25
By Leman Zeynalova – Trend:
Gas consumption in the power sector, particularly in Europe is expected to increase in 2021 as high carbon prices make it more attractive than coal and incentivize coal-to-gas switching, Trend reports with reference to the Gas Exporting Countries Forum (GECF).
“However, this may be limited based on the price competitiveness of gas. Coal and nuclear power plants phase-out in Europe and Asia are also expected to boost the demand for natural gas in the power sector. As many countries begin to implement new energy policies and regulations in alignment with their carbon emissions reduction and net-zero targets, the growth of natural gas may be reduced in favor of alternative energy sources such as renewables and green hydrogen,” reads the GECF report.
The organization believes that there are still many challenges to be overcome if these energy sources are to compete with natural gas.
“In spite of this, natural gas can continue to expand its reach into niche sectors and support net-zero targets, through technological advancements in the areas of energy efficiency of combined-cycle gas turbines, digitalization and CCUS,” the report says.
GECF notes that global gas demand has rebounded in 2021 following the impact of the COVID-19 pandemic in 2020 as the global economy recovered fueling gas demand particularly in the power and industrial sectors.
“Furthermore, an unexpected extremely cold winter season boosted gas demand for heating. Industrial sector growth in emerging economies such as China and India are expected to continue to drive gas consumption. As India expands its city gas distribution networks, gas demand in the residential, commercial and transportation sectors are expected to increase. Furthermore, growing electricity demand and supply security in the region will also contribute to gas demand in the short term,” reads the report.
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