Energy Conversion Devices Announces Large Solar Project In Spain

Energy Conversion Devices has announced it has been selected by Recurrent Energy to deliver 4.8MWp of solar generating systems for eight separate building rooftops at ProLogis Park Sant Boi in Barcelona and ProLogis Park Alcala in Madrid, Spain.

ECD will be supplying its UNI-SOLAR photovoltaic (PV) laminates and providing development resources through its Solar Integrated subsidiary.

The solar power systems will be owned by Recurrent Energy, a distributed power company and a leading provider of solar energy, and installed on rooftops leased by Recurrent Energy from ProLogis, a leading global provider of distribution facilities. Construction on the project is expected to start in October 2009.

ProLogis, a leading global provider of distribution facilities, currently has UNI-SOLAR systems installed on facilities in the U.S., Spain and France.

"We are very pleased to continue our relationship with UNI-Solar and SIT through this project," said Drew Torbin, director of global renewable energy for ProLogis. "We look forward to working with the company closely over the next several months as we bring this project on line."

"This new agreement is the first example of the benefits of combining our leading UNI-SOLAR PV laminate product with the rooftop solar expertise of Solar Integrated. This project also demonstrates how we will work closely with Recurrent Energy and our key channel partners--in this case Soprema and its dedicated subsidiary Solardis--to provide innovative solutions that meet the needs of our customers and their roofs," said Mark Morelli, president and chief executive officer for ECD.

For this project, Solar Integrated will engineer, procure, and construct the solar PV systems totaling 4.8 megawatts for Recurrent Energy.

The PV systems will consist of UNI-SOLAR laminates combined with the SOPRASOLAR complex - a bituminous waterproofing system, and will be applied directly on the roofs. Installation will be done by Soprema's local installer Master Renovables.

Source - Solar Daily

Solar panel plant to be built in France

Companies from France and United States announced plans to build a solar-panel plant to support the French government's goal of using solar-powered electricity to increase sustainable energy technology.

In 2007, French President Nicolas Sarkozy established Grenelle Environnement, a program promoting renewable energy sources, including hydraulic, wind, biomass, geothermal, photovoltaic cells and solar energy.

To the solar energy segment of that charge, EDF Energies Nouvelles, which is half owned by the French government, and First Solar Inc., which has headquarters in Tempe, Ariz., said they would build a facility in France to manufacture solar panels.

A news release from the companies said the plant would have an initial annual capacity of more than 100 Megawatt Peak. Full production is expected by the second half of 2011 with a staff of more than 300.

EDF EN Chairman Paris Mouratoglou, in the release, said the agreement supports the utility's goal of installing a capacity of 500Mwp by 2012. EDF EN has raised more than $710 million to finance expansion of the photovoltaic sector.

The companies said a site location would be determined in the next few months. It will be built in France at an investment of more than $128 million. EDF EN will finance half the capital expense and receive the plant's entire output for at least 10 years.

First Solar's manufacturing site will include a facility for recycling solar panels, Europe's only solar panel recycling plant outside of Germany.

The announcement marks First Solar's first move into France. In addition to its U.S. operations, the company has concerns in Malaysia and Germany, where company facilities generate 192 megawatts of power.

"The decision to invest in France reflects our firm belief in the French market and its great potential," First Solar Chief Executive Officer Mike Ahearn said in the release. "It represents a vote of confidence in the policies being developed by the French government since the Grenelle de l'Environnement to promote renewable energies and allow solar electricity to compete economically with other forms of energy."

He added that long-term commitments by French officials regarding policy and regulatory issues and of EDF EN to invest in developing and expanding the French market were key factors in First Solar's decision to invest in France.

"This agreement represents a key milestone in the strategy of our group, which has the ambition to be a global leader in solar energy," Mouratoglou said. "Securing a competitive supply is essential for us to participate in the development of a large French solar market."

French Sustainable Development Minister Jean-Louis Borloo was on hand for the companies' announcement and stated: "I salute the decision of EDF Energies Nouvelles and First Solar to invest and create jobs in France's solar sector, which has begun to take off since the Grenelle de l'Environnement. This investment represents a veritable turning point for the photovoltaic industry and confirms that France is more than ever in a position to play a leading role globally."

Source - Solardaily

Energy Conversion Devices And Enfinity Co-Develop Solar Projects

Energy Conversion Devices and Enfinity have announced plans to co-develop a portfolio of rooftop solar installations throughout the U.S., as well as in numerous European countries, including Belgium, Germany, France, Italy, Spain and the Czech Republic.

ECD and Enfinity have identified approximately 10 MW of projects that they will collaborate on in the short term. ECD, through its wholly owned subsidiary, United Solar Ovonic, will contribute UNI-SOLAR brand photovoltaic laminates in exchange for equity in the projects.

Enfinity will serve as project manager and lead the financing efforts for the projects. ECD and Enfinity expect to sell completed projects to third-party investors within 12 months of the start of commercial operation.

Mark Morelli, ECD's president and CEO, said, "This Framework Agreement is an example of how we are implementing our demand-creation strategy. Enfinity is an excellent partner, with significant experience in developing and installing rooftop and BIPV applications in our focused geographic markets. We are enthusiastic about the opportunities that this agreement affords us, and will be working aggressively with Enfinity to finalize the projects and begin construction."

Gino Van Neer, CEO of Enfinity stated, "We are pleased to partner with ECD and United Solar in our development efforts. Their unique photovoltaic laminates not only produce more energy per rated watt in real-world conditions, they also are the perfect solution for building-integrated systems where the integrity of the rooftop is preserved, and in many markets where the incentives are greater."

Sourece - Solardaily

Britain fails to deliver on pledge to lead world to 'green recovery'

Britain is falling far behind other big economies in launching a Green New Deal, despite Government promises to "lead the world" on this path out of the economic slump, a report reveals.

The most comprehensive study yet of "green stimuli" being introduced around the world – puts Britain near the bottom of the international league. China, for example, has devoted well over a hundred times as much money to recession-beating environmental measures, despite being castigated as an international laggard in tackling pollution.

The study will embarrass Gordon Brown as he prepares to host next month's G20 summit, which he says should spark "a low carbon recovery". And it contradicts his repeated insistence that green measures are "imperative" as a "key driver" of future economic growth. He returned to the theme yesterday in his speech to the Labour Party's National Policy Forum in Bristol. And a policy document published to complement his address calls for Britain "to lead the world in building the low carbon society with a low carbon economy".

But the report, A Climate for Recovery published by the HSBC Bank, reveals that Britain has, so far, devoted only $2.1bn (£1.5bn) to a green stimulus, less than a third of France's $7.2bn and less than a sixth of Germany's $13.8bn. China's spending, at $221.3bn, is more than 110 times that of the UK.

In addition, only 6 per cent of Britain's stimulus packages is devoted to green measures such as energy efficiency, renewable sources and public transport. This is less than a third of the proportion given as a "benchmark" by the London School of Economics' Grantham Institute. It constrasts with 13 per cent in Germany, 21 per cent in France, 38 per cent in China and 81 per cent in South Korea. Britain's is one of only three out of 16 green financial initiatives analysed by the study to be classed as "pending". Worldwide, says the report, some $430bn has been allocated to Green New Deals, although President Barack Obama's initiative has received most attention.

Such measures, the report says, raise the prospect of "killing a flock of birds with one or two stones" by tackling the economic, energy and climate issues simultaneously, creating many more jobs than conventional financial stimuli and ushering in a green technology revolution to provide "the next wave of productivity and innovation".

Source - The Independent

Gas and electricity bills are rising four times faster in the UK

Britains energy prices have increased by 16.7 per cent over the past year.

The increase compares to the European average of 3.8 per cent, with 1.5 per cent in Germany, 1.3 in Denmark and 5.3 in Sweden. Continental energy companies have been accused of “picking the pocket” of British consumers as four of the six biggest gas and electricity firms in Britain are European-owned.

Among developed nations, only Australia (20 per cent) and Turkey (28.7 per cent) had faster price rises, the OECD figures showed. The figures were released after the Conservatives called for energy companies to be investigated for refusing to pass on price cuts to consumers.

The wholesale cost of energy has dropped sharply since the summer, but suppliers have failed to reduce what they charge customers, leading to accusations of profiteering.

British households saw their energy bills rise by £381 to £1,293 on average last year, according to price comparison website uSwitch.com.

It brings further misery to UK households which have seen their budgets squeezed by higher petrol and food costs compared to a year ago.

Will Marples, energy expert at uSwitch.com, said: “On top of this, consumers are dealing with the ongoing economic crisis while waiting for news of whether energy price cuts are going to be delivered this year or not. Whereas previously they may not have worried about how UK energy bills compared with those in Europe, or factors affecting prices, these issues are now firmly on the agenda as British consumers want to know that they are getting a fair deal.”

Energy experts suggest that British consumers suffer more than their European neighbours because of the country’s reliance on the gas market, and its lack of storage.

Britain has just 13 days’ gas storage, compared with 99 in Germany and 122 in France, making it less easy to stockpile gas when it is cheap.

Experts also warned that average prices could rise as a result of Russia cutting its gas supplies in a dispute with Ukraine.

Among the most vulnerable to price increases are pensioners, according to charities.

Paul Bates, a spokesman for Help the Aged suggested that more than 20,000 people die from preventable illnesses as a result of the cold.

He said: “Too many pensioners are facing the stark choice between heating and eating, putting their health at risk

“No older person should ever have to worry about whether they can afford to heat their homes properly in the winter.”

The Energy Retails Association said British customers have enjoyed historically low prices compared to Europe due to our reserves of natural gas in the North Sea.

She said: “The prices we now pay for our energy are more vulnerable to fluctuations.”

Source - The Telegraph

Solar Thermal Market Growing

The Solar Thermal Systems (STS) market for hot water and heating has changed considerably over the past few years in Europe as market shares spread into new countries. In 2003, close to 80% of the solar thermal market in operation was concentrated in Germany, Greece and Austria.

Just a few years later, these same countries only hold 55%, making room for countries like Spain, Italy and France that previously only held about 10% of the total market share each. Now France, Italy and Spain are among the fastest growing solar thermal markets in Europe.

Supported by government legislation, consumer attitudes, and manufacturers' increasing production, Frost and Sullivan believes this combination is a strong predictor of medium and long term market growth.

"Within the past few years, all circumstances are very encouraging for the continuation of the STS growth in the European market. This growth is no longer exclusively ensured by a few leading countries, such as Germany and Austria, but by new countries like Spain, Italy, and France, and even Portugal and the UK," notes Frost and Sullivan Hammam Ahmed, Research Analyst.

Motivated by meeting their national and international commitments to decrease dependency on fossil fuel and create more jobs, many European governments are spurring on domestic markets through a number of incentive programmes, providing support for R and D, and raising public awareness. The solar thermal market is being increasingly supported by these governments.

Financial incentives, lessoning the burden of petitioning for building permission are ways governments have been stimulating STS growth. At times European governments have gone as far as introducing new legislation that requires or goads installing solar systems in buildings, either under construction or being renovated. By softening regulations, governments will continue to have a positive impact in the long term.

Customer attitudes about solar thermal systems are also becoming more optimistic. The combination of solar thermal systems becoming more affordable and noticeably cutting customers' energy bills has improved the public perception of this technology.

Public support is directly related to the growth of the STS market, as the largest sector is residential, especially single family homes, which account for almost 80% of the total market. As the public continues to search for affordable and effective alternative energy, the residential sector will continue to grow as public support does.

Finally, over the past few years many solar thermal system manufacturers significantly increased their production. These expansions are not exclusive to solar thermal system manufacturers, but traditional heating suppliers are also getting a piece of the action and including solar thermal systems in their range.

In his research, Hammam Ahmed gives an example from the UK, where some boiler manufacturers are starting to include solar thermal system along with their products, as a supplement. This kind of promotion further propels the STS market forward.

In the past five years, the STS market has overcome a lot of change and, even in the midst of a receding global economy, seems unscathed. Considering all of the elements that shape the STS market, future growth is widely anticipated.

Source - Solardaily

Time to invest in renewable technology

Myth 1: solar panels is too expensive to be of much use

In reality, today’s bulky and expensive solar panels capture only 10% or so of the sun’s energy, but rapid innovation in the US means that the next generation of panels will be much thinner, capture far more of the energy in the sun’s light and cost a fraction of what they do today. They may not even be made of silicon. First Solar, the largest manufacturer of thin panels, claims that its products will generate electricity in sunny countries as cheaply as large power stations by 2012.

Other companies are investigating even more efficient ways of capturing the sun’s energy, for example the use of long parabolic mirrors to focus light on to a thin tube carrying a liquid, which gets hot enough to drive a steam turbine and generate electricity. Spanish and German companies are installing large-scale solar power plants of this type in North Africa, Spain and the south-west of America; on hot summer afternoons in California, solar power stations are probably already financially competitive with coal. Europe, meanwhile, could get most of its electricity from plants in the Sahara desert. We would need new long-distance power transmission but the technology for providing this is advancing fast, and the countries of North Africa would get a valuable new source of income.

Myth 2: Large-scale wind power is too unreliable

Actually, during some periods earlier this year the wind provided almost 40% of Spanish power. Parts of northern Germany generate more electricity from wind than they actually need. Northern Scotland, blessed with some of the best wind speeds in Europe, could easily generate 10% or even 15% of the UK’s electricity needs at a cost that would comfortably match today’s fossil fuel prices.

The intermittency of wind power does mean that we would need to run our electricity grids in a very different way. To provide the most reliable electricity, Europe needs to build better connections between regions and countries; those generating a surplus of wind energy should be able to export it easily to places where the air is still. The UK must invest in transmission cables, probably offshore, that bring Scottish wind-generated electricity to the power-hungry south-east and then continue on to Holland and France. The electricity distribution system must be Europe-wide if we are to get the maximum security of supply.

We will also need to invest in energy storage. At the moment we do this by
pumping water uphill at times of surplus and letting it flow back down the mountain when power is scarce. Other countries are talking of developing “smart grids” that provide users with incentives to consume less electricity when wind speeds are low. Wind power is financially viable today in many countries, and it will become cheaper as turbines continue to grow in size, and manufacturers drive down costs. Some projections see more than 30% of the world’s electricity eventually coming from the wind. Turbine manufacture and installation are also set to become major sources of employment, with one trade body predicting that the sector will generate 2m jobs worldwide by 2020.

Myth 3: marine energy is a dead-end

The thin channel of water between the north-east tip of Scotland and Orkney contains some of the most concentrated tidal power in the world. The energy from the peak flows may well be greater than the electricity needs of London. Similarly, the waves off the Atlantic coasts of Spain and Portugal are strong, consistent and able to provide a substantial fraction of the region’s power. Designing and building machines that can survive the harsh conditions of fast-flowing ocean waters has been challenging and the past decades have seen repeated disappointments here and abroad. This year we have seen the installation of the first tidal turbine to be successfully connected to the UK electricity grid in Strangford Lough, Northern Ireland, and the first group of large-scale wave power generators 5km off the coast of Portugal, constructed by a Scottish company.

But even though the UK shares with Canada, South Africa and parts of South America some of the best marine energy resources in the world, financial support has been trifling. The London opera houses have had more taxpayer money than the British marine power industry over the past few years. Danish support for wind power helped that country establish worldwide leadership in the building of turbines; the UK could do the same with wave and tidal power.

Myth 4: nuclear power is cheaper than other low-carbon sources of electricity

If we believe that the world energy and environmental crises are as severe as is said, nuclear power stations must be considered as a possible option. But although the disposal of waste and the proliferation of nuclear weapons are profoundly important issues, the most severe problem may be the high and unpredictable cost of nuclear plants.

The new nuclear power station on the island of Olkiluoto in western Finland is a clear example. Electricity production was originally supposed to start this year, but the latest news is that the power station will not start generating until 2012. The impact on the cost of the project has been dramatic. When the contracts were signed, the plant was supposed to cost €3bn (£2.5bn). The final cost is likely to be more than twice this figure and the construction process is fast turning into a nightmare. A second new plant in Normandy appears to be experiencing similar problems. In the US, power companies are backing away from nuclear because of fears over uncontrollable costs.

Unless we can find a new way to build nuclear power stations, it looks as though CO2 capture at coal-fired plants will be a cheaper way of producing low-carbon electricity. A sustained research effort around the world might also mean that cost-effective carbon capture is available before the next generation of nuclear plants is ready, and that it will be possible to fit carbon-capture equipment on existing coal-fired power stations. Finding a way to roll out CO2 capture is the single most important research challenge the world faces today. The current leader, the Swedish power company Vattenfall, is using an innovative technology that burns the coal in pure oxygen rather than air, producing pure carbon dioxide from its chimneys, rather than expensively separating the CO2 from other exhaust gases. It hopes to be operating huge coal-fired power stations with minimal CO2 emissions by 2020.

Myth 5: electric cars are slow and ugly

We tend to think that electric cars are all like the G Wiz vehicle, with a limited range, poor acceleration and an unprepossessing appearance. Actually, we are already very close to developing electric cars that match the performance of petrol vehicles. The Tesla electric sports car, sold in America but designed by Lotus in Norfolk, amazes all those who experience its awesome acceleration. With a price tag of more than $100,000, late 2008 probably wasn’t a good time to launch a luxury electric car, but the Tesla has demonstrated to everybody that electric cars can be exciting and desirable. The crucial advance in electric car technology has been in batteries: the latest lithium batteries - similar to the ones in your laptop - can provide large amounts of power for acceleration and a long enough range for almost all journeys.

Batteries still need to become cheaper and quicker to charge, but the UK’s largest manufacturer of electric vehicles says that advances are happening faster than ever before. Its urban delivery van has a range of over 100 miles, accelerates to 70mph and has running costs of just over 1p per mile. The cost of the diesel equivalent is probably 20 times as much. Denmark and Israel have committed to develop the full infrastructure for a switch to an all-electric car fleet. Danish cars will be powered by the spare electricity from the copious resources of wind power; the Israelis will provide solar power harvested from the desert.

Myth 6: biofuels are always destructive to the environment

Making some of our motor fuel from food has been an almost unmitigated disaster. It has caused hunger and increased the rate of forest loss, as farmers have sought extra land on which to grow their crops. However the failure of the first generation of biofuels should not mean that we should reject the use of biological materials forever. Within a few years we will be able to turn agricultural wastes into liquid fuels by splitting cellulose, the most abundant molecule in plants and trees, into simple hydrocarbons. Chemists have struggled to find a way of breaking down this tough compound cheaply, but huge amounts of new capital have flowed into US companies that are working on making a petrol substitute from low-value agricultural wastes. In the lead is Range Fuels, a business funded by the venture capitalist Vinod Khosla, which is now building its first commercial cellulose cracking plant in Georgia using waste wood from managed forests as its feedstock.

We shouldn’t be under any illusion that making petrol from cellulose is a solution to all the problems of the first generation of biofuels. Although cellulose is abundant, our voracious needs for liquid fuel mean we will have to devote a significant fraction of the world’s land to growing the grasses and wood we need for cellulose refineries. Managing cellulose production so that it doesn’t reduce the amount of food produced is one of the most important issues we face.

Myth 7: climate change means we need more organic agriculture

The uncomfortable reality is that we already struggle to feed six billion people. Population numbers will rise to more than nine billion by 2050. Although food production is increasing slowly, the growth rate in agricultural productivity is likely to decline below population increases within a few years. The richer half of the world’s population will also be eating more meat. Since animals need large amounts of land for every unit of meat they produce, this further threatens food production for the poor. So we need to ensure that as much food as possible is produced on the limited resources of good farmland. Most studies show that yields under organic cultivation are little more than half what can be achieved elsewhere. Unless this figure can be hugely improved, the implication is clear: the world cannot feed its people and produce huge amounts of cellulose for fuels if large acreages are converted to organic cultivation.

Myth 8: zero carbon homes are the best way of dealing with greenhouse gas emissions from buildings

Buildings are responsible for about half the world’s emissions; domestic housing is the most important single source of greenhouse gases. The UK’s insistence that all new homes are “zero carbon” by 2016 sounds like a good idea, but there are two problems. In most countries, only about 1% of the housing stock is newly built each year. Tighter building regulations have no effect on the remaining 99%. Second, making a building genuinely zero carbon is extremely expensive. The few prototype UK homes that have recently reached this standard have cost twice as much as conventional houses.

Just focusing on new homes and demanding that housebuilders meet extremely high targets is not the right way to cut emissions. Instead, we should take a lesson from Germany. A mixture of subsidies, cheap loans and exhortation is succeeding in getting hundreds of thousands of older properties eco-renovated each year to very impressive standards and at reasonable cost. German renovators are learning lessons from the PassivHaus movement, which has focused not on reducing carbon emissions to zero, but on using painstaking methods to cut emissions to 10 or 20% of conventional levels, at a manageable cost, in both renovations and new homes. The PassivHaus pioneers have focused on improving insulation, providing far better air-tightness and warming incoming air in winter, with the hotter stale air extracted from the house. Careful attention to detail in both design and building work has produced unexpectedly large cuts in total energy use. The small extra price paid by householders is easily outweighed by the savings in electricity and gas. Rather than demanding totally carbon-neutral housing, the UK should push a massive programme of eco-renovation and cost-effective techniques for new construction.

Myth 9: the most efficient power stations are big

Large, modern gas-fired power stations can turn about 60% of the energy in fuel into electricity. The rest is lost as waste heat.

Even though 5-10% of the electricity will be lost in transmission to the user, efficiency has still been far better than small-scale local generation of power. This is changing fast.

New types of tiny combined heat and power plants are able to turn about half the energy in fuel into electricity, almost matching the efficiency of huge generators. These are now small enough to be easily installed in ordinary homes. Not only will they generate electricity but the surplus heat can be used to heat the house, meaning that all the energy in gas is productively used. Some types of air conditioning can even use the heat to power their chillers in summer.

We think that microgeneration means wind turbines or solar panels on the roof, but efficient combined heat and power plants are a far better prospect for the UK and elsewhere. Within a few years, we will see these small power plants, perhaps using cellulose-based renewable fuels and not just gas, in many buildings. Korea is leading the way by heavily subsidising the early installation of fuel cells at office buildings and other large electricity users.

Myth 10: all proposed solutions to climate change need to be hi-tech

The advanced economies are obsessed with finding hi-tech solutions to reducing greenhouse gas emissions. Many of these are expensive and may create as many problems as they solve. Nuclear power is a good example. But it may be cheaper and more effective to look for simple solutions that reduce emissions, or even extract existing carbon dioxide from the air. There are many viable proposals to do this cheaply around the world, which also often help feed the world’s poorest people. One outstanding example is to use a substance known as biochar to sequester carbon and increase food yields at the same time.

Biochar is an astonishing idea. Burning agricultural wastes in the absence of air leaves a charcoal composed of almost pure carbon, which can then be crushed and dug into the soil. Biochar is extremely stable and the carbon will stay in the soil unchanged for hundreds of years. The original agricultural wastes had captured CO2 from the air through the photosynthesis process; biochar is a low-tech way of sequestering carbon, effectively for ever. As importantly, biochar improves fertility in a wide variety of tropical soils. Beneficial micro-organisms seem to crowd into the pores of the small pieces of crushed charcoal. A network of practical engineers around the tropical world is developing the simple stoves needed to make the charcoal. A few million dollars of support would allow their research to benefit hundreds of millions of small farmers at the same time as extracting large quantities of CO2 from the atmosphere.

Source - The guardian

UK energy supply has entered into terminal decline

In recent years, the UK has become increasingly dependent on natural gas as its primary energy source. This strategy may soon be found to be based upon poor assumptions/perceptions regarding development of domestic and neighbouring natural gas reserves and, in general, regional and global supply capabilities.

1. UK marketable nat gas production (also gross) peaked in 2000 close to 110 Gcm/a.
2. During the last three years, UK nat gas production has declined at an annual rate of 8 - 10 %, which many energy analysts expect will continue.
3. Nat gas constituted more than 38 % of the UK primary energy consumption in 2007.
4. Several analyses expect UK to import 80 % of their nat gas consumption by 2020.
5. UK was a net exporter of nat gas for a brief period.

In 2007, more than 38 % of the UK’s primary energy consumption came from nat gas. Of the EU/OECD countries, only Italy has a higher portion of nat gas consumption. In comparison, the USA gets 25 % of its primary energy consumption from natural gas; France, 15 %; and Germany, 24 %.

In general, high nat gas usage is primarily found among countries with huge nat gas reserves like Russia, where nat gas amounted to more than 57 % of primary energy production in 2007. Russia is the world’s largest exporter of nat gas and second largest exporter of oil, so this high domestic usage frees up oil for export. Since oil generates more income than nat gas, based on units of energy exported, this approach maximizes export revenue.

The UK and Continental Europe have both benefitted from the bidirectional Interconnector that since 1998 has allowed for increased flexibility in nat gas supplies. Due to the decline in UK indigenous supplies and a tighter supply situation on Continental Europe, the importance of the Interconnector is expected to slowly diminish unless future Russian supplies are shipped through the system to UK.

Nat gas production within EU was on a plateau from 1996 to 2004 and has now entered into terminal decline. Increased nat gas production from Norway (which is not a full EU member) has slowed the decline. The balance of consumption within EU has been secured through increasing imports, primarily from Russia, North Africa and LNG. The diagram above suggests that imports into EU will need to grow quickly, from 200 Gcm/a at present to projected 400 Gcm/a by 2020, to fill the rapidly growing gap between declining supplies and projected growth in consumption.

If projected growth in EU nat gas consumption by 2020 is to be met, it will be necessary to double present imports of 200 Gcm/a from Russia, North Africa and LNG, a challenging task. With the ongoing credit crisis still unfolding, an increase in imports that allows maintenance of present EU consumption levels may turn out to be a major accomplishment.

As of 2007, 25 % of EU’s nat gas consumption was imported from Russia. Russian nat gas exports to the EU grew substantially after the completion of pipelines between Western Siberia and Europe by the mid 80’s.

There are good reasons to believe that the Russians (meaning Gazprom) planned their exports to the EU based upon available official data and forecasts from amongst others, EU members and Norway. This is of course a sensible thing to do if the goal is to maximize the profits from the Russian resource base and to optimize the allocation of investment funds. Why invest in expansions of production and infrastructure, if these investments are likely to contribute to an oversupply and a subsequent downward pressure on prices?

Perhaps what is needed is an energy czar. I think it was Matt Simmons who first used the expression “energy czar”, perhaps with a hidden meaning that Russians leaders far better understand the strategic nature of energy than their western counterparts, even though their access to data is not as good.

In 1995 - 1998, the UK exported nat gas to Ireland. In 1998, the Interconnector, the bidirectional pipeline between Bacton in UK and Zeebrugge in Belgium, started to flow. After that, the UK became a moderate exporter of nat gas to Continental Europe.

EU production of natural gas has peaked, and is expected to decline. EU exclusive of UK nat gas production peaked in 1996. Since then, natural gas production has been in a general decline and is expected to continue to decline. Recently Dutch authorities confirmed that their nat gas production is set to decline. These milestones were passed without much attention. For the next several years, projected increases in Norwegian nat gas production are expected to partly offset declines in production in the EU, but the overall production trend is expected to remain downward.

UK has for some years had an important role in securing a unique flexibility with respect to the EU nat gas supply chain. The combined effect of the declining nat gas production in UK and the rest of the EU has already tightened the supply situation for EU (ref the recent price growth within the liberalized UK market), and has the potential to develop into a severe nat gas supply crunch. Such a supply crunch could have cascading effects, and may affect other energy systems. These interrelationships seem to be poorly understood among those responsible for developing energy supply strategies.

Source - The Oil Drum