Abstract
With the recent rising attention and debates on the role of natural gas, especially liquid natural gas, in energy transition, it is critical to have a consistent approach in assessing uncertainties and dynamics in the global gas market during the next two to three decades. There are two objectives of this paper. The first one is to estimate and discuss the impacts of the global liquified natural gas (LNG) trade under a low-carbon scenario using a partial equilibrium model. The second objective is to discuss the role of a structural economic model in empirical analysis and strategy design under a regime shift, such as an energy transition, for the global natural gas market.
Highlights
As natural gas replaces oil and coal in the energy system of many countries, this has led to a significant expansion of the gas trade, and as a result, major changes have occurred in gas transmission from the source to consumer markets
International Energy Agency (IEA) Net Zero by 2050 (NZE) assumes gas demand will be disrupted by higher energy efficiency, more rapid penetration of hydrogen, and wider use of bioenergy combined with CCS
This paper examines a highly complex structural economic model of the natural gas market, discusses its basic methodology and trade-offs, and tests its ability to forecast under a regime shift
Summary
As natural gas replaces oil and coal in the energy system of many countries, this has led to a significant expansion of the gas trade, and as a result, major changes have occurred in gas transmission from the source to consumer markets. The role of natural gas as a “bridge fuel” has been challenged by some, led by the new energy report of the Net Zero roadmap by the International Energy Agency (IEA). While it expects LNG prices to eventually trade at a premium to oil by 2050, this scenario clearly envisions a very drastic reduction in terms of fossil fuel demand to lower the carbon dioxide output with relatively less in the way of offsets. This scenario has outlined a vision of the future that is sharply different from many net-zero or low-carbon scenarios released so far by large energy companies and industry consultants. Since the publication of the IEA NZE scenario, others in the industry have expressed strong opinions, too
Sign-in/Register to view highlights & summary Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
