Demand for Storage of Natural Gas in Northwestern Europe: Trends 2005-2030
25 Pages Posted: 7 Jun 2006
Date Written: March 2007
Abstract
The seasonal demand for natural gas requires supply flexibility. This "swing" is now largely provided in northwestern Europe by indigenous production. Declining reserves will increase the dependency on imports from far-off sources, which are less flexible. Hence, flexibility must be provided by additional storage. We estimate that in 2030 between 10 (with no strategic storage) and 29 (with 10 per cent strategic storage for imports from non-EU countries) billion cubic meter of working gas volume will be required, in addition to the existing 40 billion cubic meters. This estimation is based on production and consumption forecasts for natural gas and observations of the relationship between the supply and demand of gas and the supply and demand of flexibility in the period 1995-2005. We provide different scenarios to check for the robustness of our results. We discuss the impact of third-party access to storage facilities on incentives to close the storage gap, as well as policy implications of strategic storage obligations.
Keywords: Seasonal swing, strategic storage obligations, thirdparty access
JEL Classification: L98, L51, Q41
Suggested Citation: Suggested Citation
Do you have negative results from your research you’d like to share?
Recommended Papers
-
The Liberalization of Energy Markets in Europe and Italy
By Michele Polo and Carlo Scarpa
-
Will Oil Prices Decline Over the Long Run?
By Robert Kaufmann, Pavlos Karadeloglou, ...
-
Cost Savings from Generation and Distribution with an Application to Italian Electric Utilities
By Giovanni Fraquelli, Massimiliano Piacenza, ...
-
By Michele Polo and Carlo Scarpa
-
Take or Pay Contracts and Market Segmentation
By Michele Polo and Carlo Scarpa
-
Energy Markets and the Euro Area Macroeconomy
By Rolf Strauch, Aidan Meyler, ...
-
Petrodollars and Imports of Oil Exporting Countries
By Roland Beck and Annette Kamps
-
By Bettina Landau and Frauke Skudelny
-
Gas Storage Services and Regulation in Italy: A Delphi Analysis
By Monica Bonacina, Anna Creti, ...