Energy transition

The transition from traditional fossil fuels to renewable energy sources will take several decades. Natural gas will continue to play an important role throughout this transition period. Natural gas is by far the cleanest of all the fossil fuels. It also provides a degree of flexibility for electricity generation purposes that will increase as power generation becomes increasingly dependent on wind and solar power. After all, the wind does not always blow, nor does the sun always shine. Gas-fired power stations can respond rapidly to any shortfalls, either on a large-scale basis or on a smaller-scale basis, e.g. local power generation units such as high-efficiency eco-boilers and mini-CHP plants.

Fortunately, sufficient natural gas reserves exist including reserves below the Netherlands, e.g. the Groningen gas field, that contain almost 1,000 billion m³ – even fifty years after its discovery. Extracting this gas also has a downside, as recently became apparent when production areas experienced a series of minor tremors. Unfortunately, more sizeable earthquakes cannot be ruled out in the future. Gas producer NAM is working closely with the Dutch government and local communities to analyse the damage and to take measures to mitigate the risks associated with gas production.

In the international arena, enormous existing gas reserves have grown still further with the discovery and production of shale gas locked in certain rock strata below the United States. This is a particularly controversial form of gas. Fears exist that the fracking or fracturing process required to extract gas from these strata entails too high a risk for the environment.

Despite these challenges, natural gas remains the ultimate transition fuel. Unfortunately, the European market is currently opting to burn coal instead of gas to generate electricity given coals' low price. Coal is very cheap in Europe at the moment because large-scale shale gas production in the USA has prompted the export of surplus coal to Europe. Gas-fired power stations are therefore running at minimum capacity or even being decommissioned because it is cheaper to run coal-fired power stations. From an environmental perspective, this is detrimental because burning coal releases far higher levels of CO2 making it far more difficult for Europe to achieve its climate objectives.