Uncertainty – both over the direction of government policy and how events will unfold in general – means there is wide array of potential outcomes.
The company has released the latest iteration of its annual Future Energy Scenarios report, which examines four different potential pathways for Britain’s energy system between now and 2040: ‘Gone Green’, ‘Consumer Power’, ‘Slow Progression’ and ‘No Progression’.
The difficulty in replacing it as a fuel for domestic heating means gas plays a significant role in the UK’s energy system across all four scenarios. However, how much will be used, and where it will come from varies widely.
The four future energy scenarios
Source: National Grid
From its current level of around 900TWh, annual demand for gas in 2040 is predicted to fall to as low as 600TWh in one scenario (Slow Progression) but remain more than 800TWh in another (No Progression). The forecast for annual domestic demand – currently around 325TWh – varies from just 150TWh (Gone Green) to 300TWh (No Progression).
How much gas is consumed will depend on a number of factors, including: the extent to which heating is electrified with the use of heat pumps; how much heating requirements are reduced through energy efficiency measures and district heating; and the volume of power which is generated by gas-fired plants.
In the ‘Gone Green’ scenario – whereby the country has strong environmental ambitions and the prosperity to achieve them – there is a widespread uptake of energy efficiency measures and new technologies, and from 2020 onwards “policy become focused on the electrification of heating”.
As a result gas demand falls faster than in all other scenarios until around 2030. After that the introduction of carbon capture and storage to the remaining gas generation fleet “reverses the trend”, leading to an increase in demand.
Speaking at the launch of the report, director of the UK Energy Research Centre Jim Watson said the extent to which CCS is developed will be one of the main factors in determining the role of gas in the future. Without it gas-fired generation will be “squeezed out of the system due to carbon constraints”.
Either way “we’re well over our gas bridge already,” said Watson. “We’ve been shifting away from coal and towards gas ever since 1970 in the UK because of access to North Sea gas,” he added.
“We’ve had a lot of those gains . There are some gains to be made still as we close our final coal-fired power stations. But those gains are time limited and limited in terms of volume.”
Projected annual gas demand:
Source: National Grid
Britain’s reliance on imports in 2040 is predicted to range from more than 90 per cent (Slow Progression) to just over 30 per cent (Consumer Power). The volume which the UK is likely to produce domestically through conventional extraction methods is broadly consistent across the four scenarios.
However there is a large disparity in the volumes which are predicted to be produced via the hydraulic fracturing of shale. The ‘Gone Green’ scenario envisages no shale gas being produced whatsoever due to public opinion, whereas the ‘Consumer Power’ scenario sees 32 billion cubic metres a year being produced – around a third of the country’s total supplies.
Watson said whether or not shale gas reserves are exploited will “fundamentally depend on the economics”. He continued: “I am not yet convinced because we don’t have the evidence that shale is an economic prospect in the UK. If we have a low energy price world … I think that’s going to make it harder for shale to break through.”
Speaking to Utility Week last month chief operating officer for IGas John Blaymires said he believes British shale gas should be economically viable if UK wells can match the flow rates seen at wells in the US.