Emergency rush into gas prompts question of stranded energy assets

Emergency rush into gas prompts question of stranded energy assets

In July, the European Parliament made a remarkable decision: it approved a law designating natural gas as a sustainable energy source.

Until a couple of years ago, the EU wanted to remove gas from the energy mix as soon as possible. The European Investment Bank had sought to cut off financing of natural gas infrastructure projects — from pipelines to liquefied natural gas terminals.

But Russia’s invasion of Ukraine has changed perceptions entirely. Instead of potentially stranding natural gas assets in the decade ahead, policymakers have shifted their attention to how they can keep the lights on and homes warm this winter. Tens of billions of euros of investment in gas projects will follow.

It is part of scramble throughout Europe — especially in Germany, Austria and Italy — to find ways to reduce dependence on Russia’s natural gas, which accounts for roughly a third of the continent’s supply.

Conserving demand is one way. Following this year’s REPowerEUscheme, the EU has agreed plans to cut energy use by 15 per cent. For example, Germany has dimmed its street lighting, and Spain has put limits on heating and air conditioning use in most buildings. Ideally, the overall plan will phase out Russian imports by 2030.

Yet