Natural gas vehicles should take their rightful place in the debate on the future of European energy

June 6, 2011 | 00:00

Natural gas vehicles should take their rightful place in the debate on the future of European energy

This conference is taking place at a time that can be rightly called a turning point for the European energy sector. Many external factors are forcing Europeans to take a fresh look at the target model for the continent’s energy security.
Political crises in North Africa and the Middle East, the war in Libya and the interruption of oil and gas supplies from this country have caused a change in approach to risk assessment for energy supplies. The question is clear: “Does Europe, for the sake of reducing dependence on Russia, need another Libya; i.e. risk jeopardizing its energy security by seeking supplies from politically unstable countries?

The accident at the Japanese nuclear power plant put the future of nuclear energy in Europe back in the spotlight. Discussions are so far continuing, but the heads of many major energy companies and industrial regions coming to Moscow and Gazprom are already declaring “We will need new supplies for gas power generation”.

Of course, we do not in any way encourage turning history back. But we want to emphasize that there is a critical mass of factors pushing to rethink European ideas on the optimal energy mix, and on how to prioritize energy policy under changing conditions.

I would like to talk now in more detail about one of the good ideas that the current context could help flourish.

The start of a car race featuring natural gas cars is timed for the general meeting of the European Business Congress. I am sure that no starting gun will misfire and that the whole car race, which will last a week, mainly along the roads of Germany, will give much pleasure to its participants and receive positive press coverage.

This is one of the campaigns that we are planning, in order to promote the development of the European gas fuel market: increase the efficiency and popularity of projects related to the creation of a European network of fueling stations.

From Prague to Greifswald, participants to the race will be informed of the plans of our partners at Volkswagen on the production of bottle-gas driven vehicles. In Berlin, at an exhibition sponsored by the European Natural Gas Vehicle Association, the public will be shown vehicles operating on natural gas, the most environmentally friendly and cleanest fossil fuel.

Currently, about 1.4 million vehicles in 40 countries across Europe (including Russia) use natural gas. Vehicles running on compressed natural gas (CNG) make up the lion’s share of the market for natural gas vehicles. At the same time, the use of liquefied natural gas (LNG) opens up broad prospects primarily for heavy trucks, as well as for synthetic diesel fuel GTL (gas-to-liquids).

The increasing use of vehicles, tightening environmental laws, as well as the move to Euro-6 standard planned in the EU, will give new impetus to the use of natural gas as transportation fuel, especially in freight transport.

Depending on the decisions that are taken today, European demand for natural gas as a motor fuel may reach 80 billion cubic metres by 2030, approximately 10 times more than current consumption.

What will this mean in terms of environmental impact and CO2 emissions? Transportation accounts for about a quarter of greenhouse gas emissions in the EU, and this figure continues to grow. According to the European Commission, automobiles accounted for about 71.3% of the emissions of the transport industry in 2008.

The EU’s ambitious plans to reduce greenhouse gas emissions are known: by 2020, emissions should be cut by 20% compared to the year 1990, and by 80% by 2050. To achieve these objectives, the European Commission recently called for reducing motor vehicle greenhouse gas emissions by 60% by 2050 compared to 1990.

EU officials are inciting manufacturers to produce more environmentally friendly modes of transport through fuel taxation. Natural gas, as the cleanest fossil fuel, is therefore ideal to solve Europe’s ambitious environmental efforts, both in the field of transport and in other sectors.

Modern transportation that runs on natural gas reduces CO2 emissions by 20-25% compared to similar transport on petrol. As environmental regulations are likely to further tighten, and thanks to a more complete combustion of methane, this kind of motor transport is an effective long-term solution.

Against this backdrop, natural gas is an environmentally as well as economically rational solution for the transport industry. Let me give you an example. On average, gas taxis in Rome spend 11-10 euros per night on fuel to cover 200-220 km. A similar taxi with a diesel engine spends 20-25 euros on fuel for the same distance. The economic benefits of gas for taxis are obvious. And for us suppliers, the absence of winter peaks and summer decline in demand are a great advantage of using gas as a motor fuel.

We believe that natural gas vehicles should take their rightful place in the debate on the future of European energy, which we called for at the beginning of the speech.

Thank you for your attention.

Speech by Alexei Miller, CEO Gazprom, at the conference “Environmental challenges and the energy sector”, as part of the European Business Congress, 2 June 2011, Prague, Czech Republic

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