Global Gas Industry Set to Resume Growth Post COVID-19, Adopt Low-Carbon Technologies: BNEF

Ample natural gas resources exist to support demand growth, but greater gas infrastructure development is needed to support growth in the medium term. India is planning to almost double the length of its gas transmission grid, while China will grow its gas network about 60% by 2025

August 07, 2020. By News Bureau

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After growing by more than 2% in 2019, global gas use is set to fall by around 4% in 2020, as the Covid-19 pandemic reduces energy consumption across the global economies. However, the resulting low gas prices, as well as clean air and climate policies, will promote further switching to gas from other more polluting energy sources, such as oil and coal. This trend was already underway before the pandemic, thanks to cost-competitive gas in key sectors including power, industry and transport, and major regions including Europe, North America and Asia.

The Global Gas Report 2020, published y the International Gas Union (IGU), research company BloombergNEF (BNEF) and Snam, the Italian-headquartered international gas infrastructure company reviews key global gas industry developments over the last year, provides a high-level outlook for future gas market developments, and examines the potential of hydrogen as a clean fuel to help meet climate goals.

The report shows that medium-term growth will come from increasing cost-competitiveness and increased global access to gas. A particular growth opportunity exists in liquefied natural gas. LNG imports reached 482 billion cubic meters in 2019, up 13% from 2018, and while this figure is expected to fall by around 4.2% in 2020, it could rebound quickly to previous levels as soon as 2021, depending on the persistence and longevity of the pandemic.

Ample natural gas resources exist to support demand growth, but greater gas infrastructure development is needed to support growth in the medium term. India is planning to almost double the length of its gas transmission grid, while China will grow its gas network about 60% by 2025.

Ashish Sethia, global head of commodities at BNEF, commented: “The pandemic has created disruption in the global energy sector, but low gas prices will ultimately stimulate demand growth as the economy recovers. We have already seen unprecedented coal-to-gas switching in Europe, and clean air policies in major growth markets such as India and China will drive more gas adoption in the next few years.”

Joe Kang, President of IGU, said: “This pandemic crisis comes at great cost to the industry, the economy and society at large. It also reminded the world about the value of clean air and healthy environment for wellbeing, providing a unique opportunity to rebuild better. Gas is an abundant, clean, accessible and flexible substitute to more polluting energy sources, and supporting greater fuel switching from coal and oil to gas in the immediate term, while ensuring infrastructure is ready to accommodate progressively greater scale of clean gas technologies in the coming decade, is the way to secure a sustainable and prosperous future.”

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