To Quit Russian Gas, EU Invests Billions in LNG

A particularly large amount of government money is flowing into coastal terminals where cooled LNG is offloaded and heated until it can be injected into pipeline networks. Currently, there are too few of these terminals — especially in the North Sea and Baltic Sea — to meet the European Union’s gas needs.

Furthermore, instead of flowing from east to west, LNG gas will have to flow from Spain, France and the Netherlands to Central and Eastern Europe. However, as gas pipelines are mostly one-way streets, a “reverse flow” is only possible to a limited extent. The German capacities, which are geographically central within Europe and therefore key to the network, would have to be at least doubled for this to happen, according to the Fraunhofer Institute.  

Another heavy toll would come in commissioning a fleet to ship gas to Europe. LNG tankers, easily recognizable by their spherical tanks, can hold up to 175,000 cubic meters of liquefied gas, the equivalent of 90 million cubic meters of less-dense pipeline gas. So, to replace the annual 167 billion cubic meters of Russian gas, about 1,800 shiploads — or five per day — are needed for the European Union. According to the Institute of Shipping Economics and Logistics, this would require 160 new tankers at a unit price of $220 million (€212.5 million), for a total of $35.2 billion.  

‘An Emergency Now’ 
The European Union has announced its intent to become climate-neutral by 2050. Germany is aiming for 2045. If the EU burns more LNG, however, emissions will rise. 

“We have an emergency now,” said Ganna Gladkykh, who researches clean-energy transitions for the European Energy Research Alliance (EERA). “Even the International Energy Agency says there should be zero fossil fuels investment, zero investment in fossil fuel infrastructure. Then we will be able to reach the climate goals.” The EU’s pumping billions of euros into gas infrastructure is contrary to that. “It does not make sense to invest in LNG and in Europe particularly,” Gladkykh said. 

High-Cost Hydrogen Hopes
Gases produced in climate-friendlier ways are intended to mitigate the problem. Instead of fossil gases, ammonia and especially liquid hydrogen are to be processed within a few years. Should that happen, the stated intent is to repurpose the tankers, terminals and transit pipelines for the new fuels — a plan many are skeptical about.

“Whenever they say the infrastructure is hydrogen-ready, this is the way of comforting the public,” Gladkykh said. “The story line that policymakers are selling is that: ‘We invest in LNG. We are aware that it’s fossil fuels. But don’t you worry … it will become greener, because we will have improvement in hydrogen technology and then we will just receive hydrogen through it.” 

Because hydrogen is more explosive and therefore more dangerous, the transition would require different alloys and materials — as well as “a significant additional investment,” said Rainer Quitzow, research group leader at the Institute for Advanced Sustainability Studies. “The switch to hydrogen is not settled,” he said.  

The International Renewable Energy Agency estimates that the additional cost of replacing pumps, valves, instrumentation and safety systems could be as much as 20% of the cost of building an LNG plant. The current tankers and terminals could not handle hydrogen, which must be transported and stored at -260 degrees Celsius (500 F) — 100 C cooler than LNG. 

In addition, all hydrogen must first be generated sustainably by wind power or solar energy and transported to Europe, where the elements are insufficient to meet the need.

Quitzow said he saw “a risk if we build infrastructure that no longer makes sense if we want to achieve our climate goals.” That would come at the expense of efforts to slow warming. “Once you have terminals and plants,” he said, “it might be hard to get away from them — precisely because you have invested so heavily.”  

Pipeline vs. LNG: Which Is Worse for the Climate?
The conventional extraction of natural gas releases fewer emissions than fracking. Unlike Russian pipeline gas, gas from Qatar or the United States must first be liquefied before it can be transported. To do this, the gas is compressed by pressure and then “depressurized” again, cooling down further each time. In the process, as much as 8% to 25% of the energy yield is lost through the operation of the compressors.  

Then, the LNG has to be shipped across the ocean. The longer the distance, the bigger the carbon footprint. Gas from Australia shipped to Europe would have five times the “climate transport costs” of gas from Algeria.

Russia’s LNG Plans on Hold
Russia intends to liquefy and sell gas, as well. But, even in the event of a swift end to the invasion of Ukraine, Russia’s share of the gas market within Europe is likely to continue to decline for political reasons. The Kremlin will most likely have to write off its multibillion-dollar gas pipeline infrastructure to the European Union and turn its attention to a need for liquefaction plants and terminals for Russia to send gas to countries such as China and Japan.  

International sanctions following the invasion of Ukraine will limit Russia’s ability to assemble the necessary technical infrastructure, however. Most Western partners abandoned their cooperation with Russia.

EU energy independence
In their respective reports, scientists at the think tanks Agora Energiewende and E3G calculate how the European Union could reduce its gas demand and become independent of Russia within “one to four years.” Twenty percent could be replaced by implementing the European Commission’s “Fit for 55” plan. Another 45% could be achieved through heat pumps, insulation and an expansion of green energies. Just 35% would then have to be imported from other countries, amounting to about 50 billion cubic meters of gas — for which the existing infrastructure is sufficient.  

Julia Merk is data journalist at DW. Michel Penke is an investigative data journalist at DW. This article, which was Edited by Henrik Böhme and Milan Gagnon, is published courtesy of Deutsche Welle (DW).