Decarbonisation of heat in Europe: implications for natural gas demand
The EU is committed to reducing greenhouse gas (GHG) emissions to 80-95 per cent below 1990 levels by 2050. So far, the electricity sector has been the main focus of low-carbon policies, but if Europe is to meet its objectives, decarbonisation efforts will need to expand to other sectors, including the heating and cooling sector. This sector is the largest single energy user in Europe. It covers half of the final energy demand of which 42 per cent comes from natural gas alone. If the lessons of the decarbonisation of the electricity sector are to be learnt, then the gas industry may want to pay particular attention to the effects that it will have on gas demand. One problem however is that the role of the heating sector in natural gas demand is not very well understood, which is essentially due to a lack of a specific definition and available data in most energy balances. The objective of this paper is to set the scene and provide a framework to study the heating (and cooling) sector in Europe, with a special focus on the implications for the natural gas industry, and especially for natural gas demand.