IOGP input to the Roadmap on the EU Smart System Integration

This document provides IOGP’s policy recommendations and input to the forthcoming EU Strategy for Energy System Integration.

The upcoming Strategy should safeguard the achievements in the internal gas market, maximise the use of market-based and technology-neutral instruments for achieving EU climate objectives while minimising potential distortive effects from regulatory measures.

Overview

• An integrated and inclusive approach is best to tackle emissions
• Creation of a more integrated energy system
• The advantages of gas in the energy transition
• The role of low-carbon gases
• The role of hydrogen
• Institutional framework to mirror electricity market design
• Concrete projects
• IOGP policy recommendations

• Full electrification must not be an objective in itself as more cost-effective carbon-emission reductions may be achieved by using low-carbon liquids (biofuels, syn-fuels) and low-carbon gases (biogas, hydrogen, syn-gas) in hard-to decarbonise sectors such as aviation, marine, heavy-duty vehicles and industry. The EU should therefore leverage the existing natural gas system for low-carbon gases
• The upcoming Strategy should support Member States in their decarbonisation efforts and recognise the crucial role of natural gas in transitioning to a lower carbon economy
• IOGP supports the development of low-carbon gases, including gases from renewable and non-renewable sources. Because of this, any regulatory regime must recognise that Europe will continue to need a reliable market and infrastructure for the supply of natural gas for the foreseeable future to meet energy demand
• The upcoming Strategy should comprise all hydrogen production pathways, regardless of their ‘colour’. What matters is the ability to cost-effectively reduce GHG emissions and contribute to reaching targets. We genuinely believe that hydrogen is the missing link which will enable energy sector integration while reducing emissions, in particular in hard-to-abate
• The current regulatory framework for natural gas does not constitute a barrier but rather can be used as an enabler for low-carbon gases. The development of low-carbon gases would benefit when all gases would be traded with natural gas in a single market.