Energy policy decisions in 2022 cannot afford to create further fossil gas lock-ins.
27th June 2022 – This article is also available in French and German
Amidst a climate crisis, the G7 needs to think about the unequal impacts of their energy policy more globally. This means ditching gas and being transparent about hydrogen.
G7 needs to ditch gas
The invasion of Ukraine is being weaponised to push for new fossil fuel infrastructure, particularly fossil gas. Despite pledges by many countries to rapidly phase out gas, such developments occur all over the world, particularly among G7 members such as Germany, the EU and the US.
Germany plans several new onshore LNG terminals that will only be operational by 2026 at the earliest, offering nothing to ensure more immediate energy security whilst reinforcing a long-term dependency on fossil fuel that will break EU climate pledges and accelerate global warming.
The European Union’s REPowerEU plan added 13 new gas projects, bringing the total number of fast-tracked fossil fuel infrastructure projects to a total of 30, despite new research demonstrating only a single LNG-terminal in Finland would suffice to ensure EU energy security.
Across the Atlantic, US gas exports have also spiked. 25 new LNG projects have been mandated, emitting a minimum of 90 million tons of greenhouse gases (the equivalent of 20 coal plants). Further, nine new oil and gas fields have been authorised to be exploited this year.
All of these are financial and political investments that reach far into the future, reinforcing economic dependency on gas internationally. Renowned international actors like the International Energy Agency or the UN Secretary General António Guterrez agree that no new fossil infrastructure should be built to meet climate targets and that such investments would be ‘delusional’.
Most importantly, they might be illegal. A coalition of NGOs led by Client Earth is pursuing a landmark case to challenge continued funding and fastrack permits of EU fossil fuels - a win would have repercussions for the legitimacy of gas expansion across the world.
G7 needs to be transparent about hydrogen
Political institutions justify the massive investments in fossil infrastructure by stating that it can later be used for cleaner hydrogen. This narrative has been pushed by influential gas and hydrogen lobbyists, who spent €58.6 million trying to influence EU policy decisions and met with the EU commission 186 times in 2020, according to a report by Food and Water Europe.
This has pushed EU institutions to increasingly draw on unregulated terms such as ‘hydrogen-ready’ to justify gas infrastructure expansion, despite studies indicating that under any scenario a hydrogen network will be significantly smaller than the already existing fossil gas network. Gas infrastructure development, such as proposed in the recently published REPowerEU plan, therefore makes fossil lock-ins and stranded assets dangerously unavoidable.
Graph on risk of stranded assets in the gas sector (Source)
The EU aims to produce 10 million tons of ‘renewable hydrogen’ by 2030 for hard-to-decarbonise industries. However, environmental standards remain unclear, allowing corporate influences and national governments to push for a classification of carbon-intensive hydrogen as ‘green’ - as currently exemplified by the EU taxonomy proposing to label fossil gas as sustainable. Moreover, 97% of European hydrogen is currently being produced with fossil fuels. Jointly, these two factors risk turning so-called renewable hydrogen into another loophole to maintain Europe’s dependency on climate damaging energy resources.
The narrative of fossil gas as a renewable, or even a transition fuel, is both obsolete and dangerous, as a recent report from the International Institute for Sustainable Development (IISD) explains. "First, the climate crisis is now urgent: remaining atmospheric space is so limited that there is no room for any additional fossil fuels. Second, since wind, solar, and energy storage and other supporting technologies have fallen rapidly in cost and are deployable at a large scale, there is no longer a need for a bridge. Third, recent findings on the extent of methane leakage from gas infrastructure undermine claims of environmental benefits over other fossil fuels." Methane emissions are continuously underreported by fossil fuel companies while its damaging effect on the climate is 86 times that of CO2 over a 20-year period.
But the problems with hydrogen go far beyond a potential corporate corruption and dangerous links to fossil gas. They “represent the latest neocolonial resource grab, at a time when renewable resources should be used for local energy needs and climate targets rather than helping the EU deliver its climate strategy”, according to the NGO Corporate Europe Observatory.
The EU is pushing to import large quantities of so-called 'green hydrogen' from Northern and Western Africa. Throughout its transportation to Europe over 60% of the energy used to produce green hydrogen’s is lost, making the development of renewable energy projects for direct use in both Europe and Africa three times more efficient. Instead of further exporting energy to Europe, countries such as Egypt or Algeria could use solar infrastructure to decarbonise their electricity by up to 50% by 2030.
Energy security will not be achieved through further expansion of gas or hydrogen. G7 leaders are intransparent about the dangerous impacts of their prolonged reliance on fossil fuels, and instead focus overwhelmingly on short-circuiting dependency on Russian gas. We need intelligent and logical solutions to the energy and climate crisis that meet existing climate targets. This means the G7 must ditch gas, be transparent on hydrogen and instead invest massively in a socially just infrastructure for solar and wind power. The energy potential in these areas cannot be underestimated, and are an essential step in creating a more just and fossil free future.