Why COP21 needs firm, clear, effective decisions
 

   Over the past year, the global gas industry has sought to harness the insights of its experts for presentation to the upcoming 21st Conference of the Parties to the UN Framework Convention on Climate Change (COP21).

   COP21, which opens today in Paris and lasts for two weeks, will be one of the most critical meetings in the series that commenced with the Earth Summit in Rio de Janeiro in 1992. To agree a universal approach to combating climate change effectively and boosting the transition towards resilient, low-carbon societies and economies, significant progress will need to be made in Paris.

   Momentum is growing and expectations are high that COP21 will produce a global treaty on climate change. A new agreement is needed now to replace the Kyoto Protocol of 1997 and to establish emissions-reductions targets for the post-2020 period.

   The pledge earlier this year by the G7 nations to decarbonise their economies by 2100 represented a major commitment towards a positive COP21 outcome. On the international stage the gas industry has focused its input to the climate-change debate through the UN Economic Commission for Europe’s Group of Experts on Gas (UNECE GEG).

   GEG is promoting gas as the cleanest-burning fossil fuel and, through its widespread availability and competitive price, its status in providing low-carbon-emission, baseload fuel as part of the long-term progress towards a decarbonised world.

 

Renewables

   The deliverability of gas worldwide in the form of LNG is central to the sector’s enhanced prospects. LNG is now a global market with volumes shipped by sea accounting for 50 per cent of the international trade in gas and poised for a further major growth surge.

   LNG enables the arrival of natural gas in new areas where it can replace coal and oil. At the same time, the globalisation of the market is increasing the security of gas supply.

   Variable renewable energy sources (VRES), such as wind and solar, will play an increasingly important part in any future energy supply scenario, but the vagaries of the contributions these sources make give gas an integral role, providing essential back-up energy.

   The criticality of this gas support service, being able to respond swiftly to sharp load and demand changes in the power grid, only increases with the overall VRES contribution to the energy mix.

   GEG will point out to the COP21 delegates that the new, rapidly erected combined cycle gas turbine (CCGT) power plants have the lowest investment costs, and the highest efficiencies, of all power stations running on fossil fuels. Quite aside from the merits of CCGT facilities, long-term strategic planning between VRES and natural gas system providers will reap benefits for both energy buyers and sellers.

   Notwithstanding the progress made by renewables, fossil fuels still represent 80 per cent of the global energy mix and will continue to account for the majority for the foreseeable future.

 

Coal

   Coal is still the leading power plant fuel worldwide due to its comparatively low cost. However, as the advocates of gas point out, for a given heating value coal gives off twice as much carbon dioxide (CO2) as natural gas and 1.5 times that of oil.

   In a speech configured for COP21, and given at the 26th World Gas Conference in June, also in Paris, Total chief executive Patrick Pouyanne stated that a global fixed price for carbon, as called for in the UN charter, would incentivise replacing coal with natural gas.

   Total has recently shed its last coal interests and is convinced that gas must play a major role in any future energy mix. Mr Pouyanne said: “To lower greenhouse-gas emissions it is essential that we promote, together with renewables, the use of natural gas as a basic energy in power production due to its low emissions and high level of flexibility.”

Simply changing 50 per cent of coal power station consumption to gas, he argued, would cut t   he amount of CO2 generated each year by 2.5 billion less tonnes, equivalent to 5 per cent of the current global emission level.

   Gas now accounts for 50 per cent of the energy that Total provides to its customers, up from 35 per cent 10 years ago. The company is the second-largest integrated global player in the LNG sector and the growth of gas in Total's asset portfolio is linked to major projects such as Yamal LNG and initiatives in Australia that together represent investments of over US$100 billion.

 

Transport fuel

   Engie chief executive Gerard Mestrallet was another keynote speaker at WGC 26 who, with COP21 in mind, highlighted the importance of gas in the worldwide effort to combat climate change. He argued that a sustainable and successful energy transition requires a combination of decentralisation, decarbonisation and digitisation of existing energy systems and energy-efficiency efforts.

   Gas can make a critical contribution to any future energy mix, Engie’s senior officer argued, as a transport fuel for both vehicles and ships. The global market for gas-powered vehicles, for example, is growing by 18 per cent annually.

   Although compressed natural gas (CNG) is best way to deliver the fuel for smaller gas-powered vehicles, LNG provides the optimum route for buses and larger commercial and municipal vehicles. LNG is also the go-to option for gas-fuelled ships.

   Engie is committed to supporting the growth of gas as a transport fuel and has created a subsidiary in France to provide CNG and LNG distribution infrastructure. It has also established a global partnership with NYK and Mitsubishi to develop a network of LNG supply services, including LNG bunkering tankers, in the world’s leading ports.

 

Clear message

   Being responsible for 60 per cent of the greenhouse-gas emissions generated around the world, the energy sector has a critical part to play in reducing atmospheric pollution.

   Having highlighted the merits of their fuel in the battle to combat climate change, the international gas industry is cautiously optimistic that the COP 21 delegates will reach a multilateral agreement on a way to restrict global warming to a maximum of 2¢ªC above pre-industrialisation temperature levels.

   Industry leaders point out that the time has come to send the right signal to guide investors and consumers towards low-carbon solutions.

   The call to arms includes a plea to end the weak pledges and lack of political backing that have characterised previous COP meetings. Putting a price on carbon and encouraging the switch to natural gas and other sources of lower carbon energy offers a sound way forward. Now is the time to end uncertainty by providing a firm, clear and effective climate change agreement.

 

By Mike Corkhill

LNG World Shipping

November 30, 2015