Dominique JAMME Commission de Régulation de l’Energie - CRE
19
Gas Regional Initiative – North West Region 5th Stakeholder Group meeting Paris – 9 June 2009 Gas trends in the North West region Dominique JAMME Commission de Régulation de l’Energie - CRE
description
Dominique JAMME Commission de Régulation de l’Energie - CRE. Agenda. Gas trends in the region : demand, supply and trade The North West region: high potential to achieve a single integrated market. Gas trends in the North West region Demand. 58% of EU gas consumption. - PowerPoint PPT Presentation
Transcript of Dominique JAMME Commission de Régulation de l’Energie - CRE
Gas Regional Initiative – North West Region
5th Stakeholder Group meeting Paris – 9 June 2009
Gas trends in the North West region
Dominique JAMME
Commission de Régulation de l’Energie - CRE
2 5th Stakeholder Group meetingParis – 9 June 2009
Agenda
1. Gas trends in the region : demand, supply and
trade
2. The North West region: high potential to achieve a
single integrated market
3 5th Stakeholder Group meetingParis – 9 June 2009
100
150
200
250
300
350
1975
1978
1981
1984
1987
1990
1993
1996
1999
2002
2005
2010
2025
in b
cm
Gas trends in the North West regionDemand
58% of EU gas consumption
United Kingdom GermanyFrance NetherlandsBelgium & Luxembourg IrelandDenmark Sweden
GRI NW natural gas consumption in 2007 : 280 bcm
Evolution of NW GRI gas consumption since 1975
Data source: BP statistical review of world Energy and DGTREN scenarios
DGTREN Baseline scenario (Primes)
Relative stabilization of the demand after several decades of increase
Uncertainties on the long term dynamics
4 5th Stakeholder Group meetingParis – 9 June 2009
0 20 40 60 80
Egypt
Qatar
Nigeria
Other Europe & Eurasia
Algeria
Russia
Norway
Gas trends in the North West region: Supply
Main external gas suppliers to the North West region84% of EU gas production
United Kingdom Germany
Netherlands Denmark
GRI NW natural gas production in 2007: 160 bcm
in Bcm
Total GRI NW Consumption in 2007 280 bcmProduction 160 bcm
Intra-regional imports/exports 66 bcm
Imports by pipeline 123 bcm
Imports by LNG 16 bcm
Exports 16 bcm
Data source: BP statistical review of world Energy and Cedigaz
Supply concentrationUK + Netherlands: 85% of NW
GRI productionNorway + Russia: 85% of NW
GRI imports
5 5th Stakeholder Group meetingParis – 9 June 2009
LNG
Pipe gas
Source: BP statistical review of world energy 2008
Imports to the region in 2007
NORWAY 72 Bcm RUSSIA
46 BcmIntra-regional
trade = 66 Bcm
Other Europe & Eurasia
6 Bcm
West Africa 4
BcmQatar 3 Bcm
North Africa 9 Bcm
6 5th Stakeholder Group meetingParis – 9 June 2009
The decline of domestic gas production in Europe / GRI North West
Decrease of production: Production peaked in
2000 UK became a net
importer in 2004 Norway production
should continue to increase but not enough to offset the decline of EU 27 production
Source: OECD
GRI NW cons. in 2030: 300 Bcm (280 Bcm in 2007) GRI NW prod. in 2030: 70 Bcm (160 Bcm in 2007) GRI NW net imports in 2030: 230 Bcm (120 Bcm in 2007)
Source: DG TREN Baseline Scenarios - Primes
Growing dependence on external supply sources
7 5th Stakeholder Group meetingParis – 9 June 2009
94
75
82
39
10
20
30
40
50
60
70
80
90
100
2008 2009 2010 2011
The increasing role of LNG in EU gas supplies
Zeebrugge = 9 BcmIsle of Grain I and II = 13 BcmMontoir = 10 BcmFos-Tonkin = 7 Bcm
Dragon LNG = 6 Bcm South Hook = 22 Bcm Fos-Cavaou = 8 Bcm
Isle of Grain (III) = 7 Bcm
Gate = 12 Bcm
Existing and under construction LNG regasification regasification capacitiescapacities in the North-West region
Source: GLE
in Bcm
10
20
30
40
50
60
70
80
90
100
2008 2009 2010 2011
Total GRI NW capacity (Bcm)
8 5th Stakeholder Group meetingParis – 9 June 2009
0%
100%
200%
300%
400%
500%
600%
700%
BelgiumGermany
France
Netherlands
Denmark UK
Entry Interconnection capacity /demandExit Interconnection capacity/demand
A highly interconnected region
In BcmDeman
dEntry
capacityExit
capacityBelgium 16 96 57Denmark 5 - 5France 48 34 0Germany 83 65 48Netherlands 37 27 130UK 91 31 16
Interconnection capacity between NW GRI countries is particularly high comparing to the rest of EU
Interconnection capacity within the region
Data source: BP, GTE+
9 5th Stakeholder Group meetingParis – 9 June 2009
North west European market: TOWARDS A COMMON MARKET DESIGN
Majority of entry/exit systems combined with notional hubs
NBPNBP TTFTTF
PEG PEG NordNord
ZeebrZeebr..BEBBEB
NCGNCG
10 5th Stakeholder Group meetingParis – 9 June 2009
Correlation of hubs prices
Sources: Argus, Platts, Powernext
Day ahead prices on NBP, Zeebrugge, TTF and PEG NordDay ahead prices on NBP, Zeebrugge, TTF and PEG Nord March 2008- March 2009March 2008- March 2009
10,00
15,00
20,00
25,00
30,00
35,00
Mar 08 May 08 Jul 08 Sep 08 Nov 08 Jan 09
€/MWh
NBP Zeebrugge TTF PEG Nord
11 5th Stakeholder Group meetingParis – 9 June 2009
Wholesale gas prices in Europe, the decreasing influence of LTCs oil indexation?
Sources: Icis Heren for the prices of the long term contracts and Argus for the day ahead and forward prices
5
10
15
20
25
30
35
40
Feb 08 Apr 08 Jun 08 Aug 08 Oct 08 Dec 08 Feb 09
€/MWh
Day-ahead NBP (monthly average) Russian gas entry Germany Norvegian gas entry Germany
Algerian gas entry Montoir NBP Y+1 (monthly average)
Long term contracts prices and NBP day ahead and forward Y+1 Long term contracts prices and NBP day ahead and forward Y+1
12 5th Stakeholder Group meetingParis – 9 June 2009
The disruption of Russian gas supplies across Ukraine in January 2009
● Three weeks of commercial conflict between Russia and Ukraine in January 2009
Cold winter in Europe
Disruption of gas supply transiting through Ukraine to Europe
● Most impacted countries: Eastern Europe strongly dependent on Russian supply
● For the North West region, limited impact thanks to an increase in Norwegian supply and good reaction of market mechanisms
● End of crisis on 26 January: two agreements on supply and transit for the next 10 years
13 5th Stakeholder Group meetingParis – 9 June 2009
16%15%
40%10%
4%4%
1%1%
27%15%
46%33%
34%34%
60%40%
78%70%
70%70%
70%68%
100%97%
100%100%
81%70%
Russian-Ukrainian gas crisis – impact on supplies by country
25% ≤
26% - 49%
50% - 75%
76 % - 100%
No Impact
Share of Russian gas in country supply
Cut of gas supply during Rus.- Ukr.
crisis
Source: IEA 2008 and ERGEG
No final customer cut in the NW region during the crisis
14 5th Stakeholder Group meetingParis – 9 June 2009
Market reaction during the disruption of Russian supplies across Ukraine
Flows to/from the UK:gas went back to thecontinent on theInterconnector
Prices: higher on TTFand PEG nord,evidencing lack ofsupplies
17,0
19,0
21,0
23,0
25,0
27,0
29,0
02/01/2009 07/01/2009 12/01/2009 17/01/2009 22/01/2009 27/01/2009
NBP TTF Zeebrugge Peg Nord
€/MWh
Exit FlowsSource : Platts European Gas Daily,
29/01/09
Source : Argus
0
15 5th Stakeholder Group meetingParis – 9 June 2009
Storage efficiently contributed to compensate for the reduction of imports
Market zones
Storage levels (Mm3)
Filling rates Filling rates
02.03.2009 02.03.2009 02.03.2008
Germany 4 180 34% 61%
France (North) 1 993 23% 40%
UK and Belgium 1 210 28% 36%
The Netherlands & Denmark 519 36% 43%
Aust., Czech Rep., Slovakia, Hungary
3 637 33% 46%
Italy 2 252 25% 39%
Total Europe 17 013 32% 41%
Source : GSE
16 5th Stakeholder Group meetingParis – 9 June 2009
Progress can still be made to improve the access to cross-border transmission capacities
Percentage of firm available capacity compared to the total of technical capacity
Exit B
= 0 %B (TROLL) F
Entry F
= 37 %B F
Exit B
= 17 %B (SEGEO) F
2010Blaregnies / Taisnières
Exit B
= 0 %B (TROLL) F
Entry F
= 37 %B F
Exit B
= 17 %B (SEGEO) F
2010Blaregnies / Taisnières
2010BOS (GUD)
Exit D = 0 %
Entry NL = 37%D NL
Exit NL = 51 %
Entry D = 0 %NL D
Exit D = 0 %
Entry NL = 0 %D NL
Exit NL = 70 %
Entry D = 27%NL D
Exit D = 0 %
Entry NL = 10 %
D NL
2010BOS (WinGT)
Exit NL = 15 %
Entry D = 0 %NL D
2010BOS (EGT)
2010BOS (GUD)
Exit D = 0 %
Entry NL = 37%D NL
Exit NL = 51 %
Entry D = 0 %NL D
Exit D = 0 %
Entry NL = 0 %D NL
Exit NL = 70 %
Entry D = 27%NL D
Exit D = 0 %
Entry NL = 10 %
D NL
2010BOS (WinGT)
Exit NL = 15 %
Entry D = 0 %NL D
2010BOS (EGT)
Entry B = 26 %
Exit NL = 0%NL B
2010's Gravenvoeren
/Dilsen
Entry B = 26 %
Exit NL = 0%NL B
2010's Gravenvoeren
/Dilsen Exit B = 30%
Entry D = 0%B D
Exit D = 0%
Entry B = 21%D B
2010EYNATTEN 2
(EGT)
Exit D = 0%
Entry B = 20%D B
Exit B = 19%
Entry D = 1%B D
2010EYNATTEN 1
(WinGT)
Exit B = 30%
Entry D = 0%B D
Exit D = 0%
Entry B = 21%D B
2010EYNATTEN 2
(EGT)
Exit D = 0%
Entry B = 20%D B
Exit B = 19%
Entry D = 1%B D
2010EYNATTEN 1
(WinGT)
Exit D = 0 %
Entry F = 12%D F
2010Medelsheim / Obergailbach
Exit D = 0 %
Entry F = 12%D F
2010Medelsheim / Obergailbach
17 5th Stakeholder Group meetingParis – 9 June 2009
Conclusion: towards a single regional market?
● The North West region is a reality
High level of interconnection
Converging market designs
Several hubs & prices correlation
● The Russian crisis:
A good test case for the reaction capacity of the North West region
Evidence of good market flexibility
18 5th Stakeholder Group meetingParis – 9 June 2009
Conclusion: towards a single market?
● The GRI NW has a high potential to achieve an integrated market
● Main obstacles: Access to transmission capacity across the region should
remain a priority area for action in the GRI NW Difficulties regarding investment decisions – mismatches
between national regulations
● The 3rd package will provide new tools towards a single market (ACER, ENTSOG, 10 year investments plans etc…)
● Work on the convergence between the regions at a European level
19 5th Stakeholder Group meetingParis – 9 June 2009
Thank you for your attention!
* * *
www.cre.fr
