Net-zero scenarios underestimate energy demand growth, Gaz Union says

Different decarbonisation pathways and scenarios likely underestimate the rate at which global energy consumption is rising, which could create a natural gas supply shortfall by the end of the decade, the Switzerland-based industry organization International Gas Union (IGU) said at its Global. Gas Report 2024 Tuesday.

If global demand for natural gas continues to grow as it has in the past 4 years, without further development of production, a global shortfall of 22% of global supply is expected by 2030, the IGU said in its annual report.

“If demand continues to strengthen, the shortfall will be more pronounced. This underlines the urgent need to scale up investment,” the industry group said.

It also warned that the decarbonisation scenarios, which various agencies have published and which policymakers rely on to make decisions, may not have fully taken into account the recent increase in power consumption from power plants. data and cooling.

“These scenarios are likely to underestimate the actual rate of demand growth, creating imminent pressure for planners to ensure sufficient supply to meet demand,” the IGU said.

According to the group, this “significant gap between actual consumption patterns and scenario assumptions” highlights the need for a realistic approach to planning that takes into account the scalability, reliability and accessibility requirements of changing consumption patterns.

Global gas demand rose 1.5% last year compared to 2022, and demand is set to rise another 2.1% this year, thanks to strong growth in Asian demand.

The report also shows that “the 2030 energy targets of even relatively less ambitious climate and energy use scenarios are unlikely to be met,” the IGU said.

Natural gas plays a key role in addressing the so-called energy trilemma – sustainability, security and affordability, the gas industry group says.

“As we look to the future, the potential supply and investment gap in gas and other low-carbon energies requires immediate attention,” the report said.

“It is essential to check the cross paths of the scenarios with the actual forecasts to avoid misalignment and to ensure that energy supply keeps pace with the evolution of demand.”

By Charles Kennedy for Oilprice.com

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