The European gas trap

Far south in the heel of Italy, near the town of Melendugno, a road runs through olive groves until it meets a partly constructed gas power plant, the size of 12 football fields. High barbed-wire fences protect the facility from local communities protesting against the project’s environmental impact.

This facility is part of the Trans-Adriatic Pipeline (TAP), a gas infrastructure project under construction, aimed at transporting 10bn cubic metres of gas from Azerbaijan via Greece to Italy. The European part of the project cost around €6bn, of which the EU and the European Investment Bank have paid or borrowed more than €2bn.

With the support of European institutions, the fossil industry is investing in the expansion of natural gas infrastructure all across the continent. New terminals for liquified gas (LNG) are planned along the European coast from Tallinn to Athens and natural gas pipelines will be laid down from the Baltic to the Aegean.

These investments into new natural gas infrastructure across Europe amount to at least €104bn, Investigate Europe calculated using data from NGO Global Energy Monitor and industry association Gas Infrastructure Europe.

The proposed projects will result in 55 percent more LNG capacity, a 22 percent increase of power provided by gas-fired power plants and an additional 12,842 km of gas pipelines throughout the continent.

But does Europe truly need all this natural gas?

According to a report by Global Energy Monitor, the EU already has twice the gas import capacity it needs.

Eurostat data shows how European demand for natural gas dropped by 11 percent between 2010 and 2018. It will continue to do so in the future: a recent European Commission report states that the volume of European natural gas imports between 2015 and 2030 will decrease 13 to 19 percent.

Last year, the commission predicted that between 2015 and 2050 consumption will decrease 75 to 85 percent.

“In Europe, natural gas infrastructure already meets our needs,” says Lisa Fischer, senior policy advisor at climate think tank E3G after leaving the UK Department of Energy and Climate. “We have 26 LNG terminals which are together used at only 25 percent of their capacity. If we want to reduce gas consumption, yet we build new terminals, pipelines and power plants, we are facing an infrastructure lock-in, a geo-political lock-in, and a social lock-in.”

As the combustion of natural gas emits less carbon dioxide than coal, it is often seen as a ’transition’ fuel.

“In countries where houses are still massively heated with coal or wood, using natural gas greatly reduces greenhouse gas emissions,” said commission vice-president Frans Timmermans to Investigate Europe last June. “We cannot overcome the intermediate period without natural gas.”

Yet, the extraction of natural gas causes the large-scale release of methane into the atmosphere. According to the Intergovernmental Panel on Climate Change (IPCC), methane is 86 times more effective as a greenhouse gas than carbon dioxide.

Some investments in natural gas infrastructure can still be justified, says Dutch Green MEP Bas Eickhout, but only those that refine or interconnect already existing infrastructure. ‘Yet what we see is the development of enormous new projects, like TAP in Italy, aimed at increasing gas imports to Europe. These cannot simply be presented as “transition investments”‘.

In February this year, the European Commission approved the controversial 4th Projects of Common Interest (PCI) list.

The list provides a stamp of approval to infrastructure projects and opens the door to receive public funds from the EU Budget, credit from the European Investment Bank and the European Development Bank, as well as private financing.

On the 4th PCI list, 32 out of 149 proposals for energy projects concern natural gas infrastructure. Among these are the TAP-project in Italy and the EastMed pipeline aimed at transporting gas from the Levantine Sea to Greece, which almost caused a naval conflict between Greece and Turkey in August.

‘No gas projects next time’ promise

While MEP’s tried to eliminate these 32 natural gas projects from the list, they failed to do so, as the list can only be accepted or rejected in its entirety.

Climate NGO’s such as Friends of the Earth and Food & Water Europe objected and commissioner for energy Kadri Simson promised that “the next list will have no natural gas projects”.

The European Ombudsman launched an investigation into the Commission’s evaluation of sustainability and climate criteria when constituting the list.

This investigation is still open.

Some projects are simply on the list because of the political wishes of member states, admits Klaus-Dieter Borchardt, the commission’s deputy drector-general for energy. “East-Med for example is oversized. There is a lot of gas in the Mediterranean Sea, but it would make more sense to use regional LNG facilities than to bring natural gas in a long pipeline to Greece and into our markets,” he told Investigate Europe in a telephone interview in September.

Moreover, even the next PCI list, scheduled for 2021, will still include fossil projects, says Borchardt.

While sustainability will be a bigger priority in the future, he stresses, the commission cannot undo ongoing projects because of ‘legal constraints’ and commitments with companies.”That we have changed our focus, does not mean that we can now redo everything that is already underway – that is not possible.”

The commission’s power in energy infrastructure planning is negligible.

In 2009, it created the TEN-E regulation that led national network operators, such as GRTgaz of France and Thyssengas of Germany, to form an umbrella organisation called Entsog.

Every two years, it publishes its Ten Year Network Development Plan (TYNDP) which the commission uses as a basis for its infrastructure planning. In other words: the gas industry itself determines how many pipelines are needed – a conflict of interest by law.

Entsog is at the heart of decision-making, leading the ‘regional group’ meetings in which member state representatives, NGOs and project promoters discuss the necessity of new energy infrastructure.

‘No minutes, no list of participants’

“The meetings have no minutes and no participants lists”, says Frida Kieninger, campaign officer at Food & Water Europe, who has attended these meetings. “The decision-making process is extremely opaque.”

“Today it is not for the commission to decide anything,” Borchardt admits, as “this is in the hands of the European network operators”.

As early as 2015, the European Court of Auditors stated the Commission “repeatedly overestimated future gas demand” and “needs to restore the credibility of the forecasts it uses.”

The European Agency for the Cooperation of the Energy Regulators (ACER), has repeatedly criticised the lack of transparency in European energy governance. Team leader electricity infrastructure Jan Kostevc calls it “a very strange situation,” in which the network operators “run the entire investigation into what new infrastructure is needed.”

Industry once obtained this role in order to ensure energy security: Europe should not be too dependent on supplies from Russia or North Africa that could be cut off during political upheaval.

According to Entsog general director Jan Ingwersen, European gas capacity today meets European needs. But as the system still has ‘weaknesses’, additional infrastructure investments are justified.

In an analysis of the 4th PCI list, consultancy firm Artelys, which also advises the commission, concludes that “the existing EU gas infrastructure is sufficiently capable of meeting a variety of future gas demand scenarios”, even in “the event of extreme supply disruption cases”.

According to Artelys director Christopher Andrey: “The EU runs the risk of over-investment of 29 billion in unnecessary projects.”

The commission is planning to revise the TEN-E regulation and introduce independent oversight. These changes will take place only after the next PCI list has been approved.

Daphné Dupont-Nivet and Maria Maggiore / Investigate Europe

INVESTIGATE EUROPE is a journalistic team from nine countries that jointly researches topics of European relevance and publishes the results across Europe.

In addition to the authors, Cécile Andrzejewski, Wojciech Ciesla, Thodoris Chondrogiannos (Reporters United Greece), Ingeborg Eliassen, Juliet Ferguson, Jef Poortmans, Nico Schmidt, Harald Schumann and Elisa Simantke worked on this research on natural gas.

The project is supported by the Schöpflin Foundation, the Rudolf Augstein Foundation, the Hübner & Kennedy Foundation, the Fritt-Ord Foundation, the Open Society Initiative for Europe, the Gulbenkian Foundation, the Adessium Foundation and private donors. This research was also funded by the Investigative Journalism for Europe (IJ4EU) programme.

You can find more background information on the research here.

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