Date: 24/01/2023

Relevance: GS-3: Climate Change, Energy and Environment.

Key Phrase: Liquified Natural Gas, regasified, Natural Resources Defence Council, LNG Acceleration Act, Paris Agreement, post-transport regasification.

Context:

• LNG is to compensate for lost Russian gas supplies, amid the war in Ukraine. But though touted as a short-term fix, many fear the gas is here for the long haul as the EU becomes the biggest LNG importer in the world.

What is Liquified Natural Gas or LNG?

• LNG is natural gas reduced to a liquid state (liquefaction) through intense cooling to around -161 degrees Celsius (-259 Fahrenheit).
• This liquid gas is 600 times smaller than the original volume and is half the weight of water.
• The compressed fossil fuel, which is constituted almost wholly of methane — a potent greenhouse gas —, can be transported around the world by ship.
• After arriving at its destination, the cargo is regasified in a floating terminal and redistributed through pipelines.
• But despite LNG’s export potential, the high cost of liquefaction and producing LNG has limited its market.
• The cooling, liquefying and transport processes, as well as the post-transport regasification procedures, also require a lot of energy.

What’s the Climate Impact of LNG?

1. Large Energy Requirement:
   • A lot of energy is required to extract natural gas from a reservoir, to transport from the gas field to the LNG facility for processing, to chill gas to such low temperatures, and to hold it at that temperature before it is warmed and regasified following a long sea or train journey.
   • Between 10-25% of the energy of the gas is being lost during the liquefaction process.
2. Risk of Methane Leakages:
   • Methane loss across the supply chain risks also contributes to LNG’s high emissions.
   • Because of LNG’s much more complex production and transport process, the risks of methane leakages along the production, transport and regasification chain are simply much higher and therefore much more emissions-intensive.
3. GreenHouse Gas Emissions:
   • LNG emits “about twice as much greenhouse gas as ordinary natural gas,” notes the US-based nonprofit Natural Resources Defence Council (NDRC).
   • Processing LNG is so energy- and carbon-intensive that it can create almost 10 times more carbon emissions than piped gas.
4. Numerous stages Required:
   • The numerous stages required to take LNG from the wellhead to the market lead to a “very high imported emissions intensity” in comparison to piped gas, whose emissions are limited to upstream and transport and processing.

Effects on India:

• To help ease demand for gas to heat and power homes and businesses, recently some 10 cargoes of liquefied natural gas (LNG) that were destined for Asia were diverted to Europe.
• The sharp rise in global coal prices came as a boon for domestic suppliers such as Coal India. As the supply crunch in the key overseas markets grew and prices soared, the demand for coal from domestic sources climbed. Coal India and other producers increased output, yet supply remains quite tight.
• Over 70% of India’s power is generated from burning coal while the share of natural gas is just about 5%. Thus, rising natural gas prices had a limited impact on the cost of power generation in India.

Key Concerns:

• Increased additional costs: By the end of the decade, additional costs for Germany’s gas imports could reach up to €200bn ($212bn), doubling gas bills for consumers.
• Fear of Stranded Assets: There is a corresponding fear that LNG infrastructure overcapacity and long-term regasification contracts at German LNG ports will lead to stranded assets — while simultaneously delaying the phase-out of fossil fuels.

Conclusion:

• Promoting energy efficiency and renewable power is the sustainable solution to the shortfall in Russian gas.
• By investing in building efficiency alone, countries can save more gas than new LNG terminals offer.
• It may prove to be a major setback in the effort to limit global heating.

Source: The Indian Express

Mains Question:

Q. What is Liquified Natural Gas or LNG? What are its impact on climate? (words 250).