“Over the past 10 years, the share of renewable energy sources in the European energy balance has skyrocketed…However, this sector is notorious for erratic power generation.…In the event of major generation failures, primarily due to bad weather, this reserve is simply not large enough to cover the demand….This year [2021]…due to a decrease in wind farm generation, there was a shortage of electricity on the European market. Prices soared, which triggered a spike in natural gas prices on the spot market.” (Pres. Putin)
10/14/21, “Thoughts On Three Issues – Putin On Europe’s Gas Crisis, Iran Talks, Lebanon Shooting,“ Moon of Alabama
“Natural gas prices in Europe exploded last week after reports of too low inventory of natural gas for the upcoming winter. Claims were made that Russia had caused the price increase. But even the BBC finds that this is not the case:
“Russia’s own gas storage is also down.
.Adeline Van Houtte, a Europe analyst at the Economist’s Intelligence Unit, says: “Currently, the Russian domestic gas market remains tight, with output already near its peak and winter is looming… limiting gas export capacity.”
There are several other factors affecting the situation in Europe, such as:
- cold weather at the start of 2021 depleting stocks
- rising prices in spring and summer put traders off buying to sell later in the year
- limited supply from Norway because of maintenance issues
- reduction in other energy sources such as wind power
- growing demand for gas elsewhere in the world”
The ‘liberalization’ of European gas markets by the EU has also led to more speculation. It was one of the many mistakes made in European energy policy.”…
[BBC: “Gas storage across Europe is well below the 10-year average, with levels currently at about 75% of storage capacity, according to Gas Infrastructure Europe data. The UK’s gas storage is currently at full capacity – but Russia only provides about 5% of the country’s usage, so it’s less reliant on Russian imports than other European countries.…Russia supplies about 50% of the EU’s natural gas imports. Most of the rest comes from Norway and Algeria.” Chart below from BBC]
(continuing, Moon of Alabama): “Yesterday Russia’s president Vladimir Putin held a remarkable speech about energy supply to Europe and pointed out some of its weaknesses:
“Over the past 10 years, the share of renewable energy sources in the European energy balance has skyrocketed, which, on the face of it, appears to be a good thing – and they are now playing a significant and noticeable part. What can you say? It is a good thing any way you look at it.
However, this sector is notorious for erratic power generation. It requires large reserve capacities. In the event of major generation failures, primarily due to bad weather, this reserve is simply not large enough to cover the demand.
This is exactly what happened this year, when, due to a decrease in wind farm generation, there was a shortage of electricity on the European market. Prices soared, which triggered a spike in natural gas prices on the spot market.
Importantly, gas consumption is seasonal. Its reserves are traditionally replenished in the summer to meet the winter demand. However, this year, even after a cold winter in Europe, many countries chose not to do so, relying on spot gas supplies and the “invisible hand” of the market, but a spike in demand has sent prices even higher.
To reiterate, the rise in natural gas prices in Europe stemmed from shortages of electricity, not the other way around. There is no need to lay the blame on other people, which is what some of our partners are trying to do. Occasionally, you get stunned by what is being said on this account, as if these people do not know the numbers – I will say more about this later – as if they do not see the reality and are just covering up their own mistakes. Systemic flaws have been gradually introduced in European energy over the past decade, which led to a major market crisis in Europe.
As a reminder, when nuclear and natural gas-based generation were the leading energy sources, there were no such crises, and there were no grounds for them.”
Europe, especially as it wants to change its road traffic from hydrocarbon to electric driven, will need more basic electric generation capacity. The only ‘green’ way to achieve that in sufficient size is by nuclear energy.”…
Posted by b on October 14, 2021 at 16:10 UTC | Permalink
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