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Heightened natural gas prices have emerged as a key energy-policy challenge for at least the early part of the 21st century. With the recent run-up in gas prices and the expected continuation of volatile and high prices in the near future, a growing number of voices are calling for increased diversification of energy supplies. Proponents of renewable energy and energy efficiency identify these clean energy sources as an important part of the solution. Increased deployment of renewable energy (RE) and energy efficiency (EE) can hedge natural gas price risk in more than one way, but this paper touches on just one potential benefit: displacement of gas-fired electricity generation, which reduces natural gas demand and thus puts downward pressure on gas prices. Many recent modeling studies of increased RE and EE deployment have demonstrated that this ''secondary'' effect of lowering natural gas prices could be significant; as a result, this effect is increasingly cited as justification for policies promoting RE and EE. This paper summarizes recent studies that have evaluated the gas-price-reduction effect of RE and EE deployment, analyzes the results of these studies in light of economic theory and other research, reviews the reasonableness of the effect as portrayed in modeling studies, and develops a simple tool that can be used to evaluate the impact of RE and EE on gas prices without relying on a complex national energy model. Key findings are summarized.

April 12, 2013 Implications of Cost Effectiveness Screening Practices in a Low Natural Gas Price Environment: Case Study of a Midwestern Residential Energy Upgrade Program Ian Hoffman, Merrian Borgeson and Mark Zimring Executive Summary With the proliferation of statewide energy savings targets and other policies favorable to energy efficiency, savings from utility customer-funded energy efficiency programs could rise to offset much of annual load growth by 2025 (Barbose et al 2013). For these increased savings to occur, however, nearly all of these programs must pass screening for cost effectiveness. Some program administrators and state regulators are finding that conventional analyses, which only consider a narrow set of energy-savings related efficiency program benefits, are now resulting in some natural gas efficiency programs failing their cost-effectiveness criteria in the new low natural gas price environment. Regulators are considering whether to scale back or terminate gas portfolios in at least four states (WA, OR, ID, NM) because of cost-effectiveness concerns. Stakeholders in several regions of the country have asked LBNL to help assess alternatives to reducing the pursuit of energy savings in their regions. We address these requests by producing two working papers: one exploring cost-effectiveness screening policy implications of low to moderate natural gas prices, and a second assessing some of the values that policymakers may take into account in weighing the pros and cons of ending natural gas efficiency programs. In this policy brief, we lay out the challenges that low gas prices pose for cost effectiveness of an electric-gas efficiency program and portfolio. We then quantify options available to regulators and administrators who want to evaluate the tradeoffs among multiple policy objectives. A multi-measure, residential energy upgrade program in the Midwest is used as a lens to explore the implications of common and emerging cost-effectiveness policies in the context of low prices for natural gas. We illustrate the results across a range of cost-effectiveness screening options, including different discount rates, levels of test application, various benefit-cost tests, and the inclusion of non-energy resource benefits. While valuing cost effectiveness is a product of many choices regarding inputs and methodologies, this policy brief concentrates on several key issues that are likely to be common across most market and regulatory contexts: Funding Acknowledgement: The work described in this report was funded by the National Electricity Delivery Division of the U.S. Department of Energy’s Office of Electricity Delivery and Energy Reliability under Lawrence Berkeley National Laboratory Contract No. DE-AC02-05CH11231. This document is a part of LBNL’s Clean Energy Program Policy Brief series. These policy briefs highlight emerging program models, important issues that programs face, and how these issues are being addressed. To join the email list to receive briefs and papers from this series, please click here. Please direct questions or comments to Ian Hoffman (ihoffman@lbl.gov).

Sweden is undergoing a major energy transition in which the present regulatory, competition and energy decisions will determine future involvement in the “oil and gas game” after decades of successful implementation of non-fossil fuel dependence policies. Contrary to major energy policies implemented since the oil crisis of the 70’s, higher natural gas investment in infrastructure – in particular regarding offshore pipelines – is not an outcome of a consented agreement between the government and private firms. The lack of clear governmental definition towards the time to phase out nuclear terminals, and how this source of energy would be replaced, is leading the country towards an energy bottleneck that could condition future energy supply, thus governance. Under these conditions, crucial decisions shall be taken in the near future regarding granting permissions to pipelines that connect to the Russian natural gas fields following an EU trend, to the Norwegian natural gas reserves on the trail of a Nordic energy path-dependence, or to both, sharing potential benefits and risks.

As alterações climáticas estão a afetar o Ártico, aumentando o degelo e facilitando o acesso aos seus recursos, os quais se estima serem significativos, nomeadamente no que se refere a jazidas de gás natural. Todavia, a sua exploração é condicionada por fatores relacionados com os interesses e preocupações dos países árticos, as condições físicas da região e as tecnologias necessárias que encarecem o custo de produção. Não obstante, o gás natural é de primordial importância para o funcionamento das sociedades atuais, e sendo dos combustíveis fósseis o menos poluente e por isso mais apelativo em termos ambientais, assiste-se a um crescimento da sua procura. Nestas circunstâncias, o presente trabalho procura analisar as implicações políticas para a União Europeia da potencial exploração de gás natural no Ártico. Para tal, numa primeira parte analisam-se os conceitos de geopolítica, segurança energética e de Poder, com o intuito de estabelecer um entendimento comum sobre o tema. Na segunda parte, identificam-se os fatores geopolíticos que configuram as dinâmicas de Poder no Ártico, induzidas ou sofrendo influência da exploração do seu gás natural, e os desafios que condicionam essa exploração. Na terceira parte estuda-se o relacionamento entre a União Europeia e a Rússia no contexto do aprovisionamento de gás natural e, por fim, na quarta parte, analisa-se o impacto do gás natural do Ártico na segurança energética da União Europeia, bem como as potenciais oportunidades para Portugal. A análise desenvolvida permitiu concluir que o gás natural no mar de Barents da Noruega, bem como o incentivo à utilização do gás natural liquefeito, poderão diversificar o aprovisionamento, diminuindo a dependência do gás russo. As oportunidades para Portugal decorrem essencialmente do crescimento do gás natural liquefeito e da posição estratégica privilegiada do nosso país. Abstract: Climate change is affecting the Arctic, increasing ice melting and access to its resources, which are estimated to be significant with respect to natural gas deposits. However, natural gas exploitation is conditioned by many factors, such as Arctic countries interests, the physical conditions of the region and the necessary technologies, which increase production costs. Nevertheless, as natural gas is of paramount importance for societies, being the cleanest fuel fossil and the most appealing from an environmental point of view, there is a growing demand for its resources. In these circumstances, this study seeks to analyze the policy implications for the European Union in the context of potential natural gas exploration in the Arctic. Aiming at this purpose, the first part analyzes the geopolitical, energy security and power concepts in order to establish a common understanding of the subject. The second part identifies the geopolitical factors that shape the power dynamics within the Arctic, induced or influenced by exploitation of its natural gas, and the challenges that affect this operation. The third part studies the relationship between European Union and Russia in the context of natural gas supply and, the fourth and last part analyzes the impact of Arctic natural gas in European Union’s energy security, as well as the potential opportunities for Portugal. The analysis concluded that natural gas in the Norwegian Barents Sea, as well as the further development of liquefied natural gas, will increase the diversity of supplies, reducing the Russian gas dependence. Opportunities for Portugal consist mainly of the potential development of liquefied natural gas and the strategic position of the country. N/A

Turkey is an important candidate to be the “energy corridor” in the transmission of the abundant oil and natural gas resources of the Middle East and Middle Asia countries to the Western market. Turkey is planning to increase its oil and gas pipeline infrastructure to accommodate its increased energy usage. The main objective of the present study is to investigate the place of natural gas in Turkey’s energy sources by presenting its historical development. Natural gas consumption started in 1976 with the usage of limited indigenous natural gas production in a few industrial plants in Turkey. However, natural gas began penetrating the energy market in the late 1980s. Its consumption is increasing rapidly. The first autoproducer natural gas-fired plant was installed in 1992, while imports of liquefied natural gas (LNG) from Algeria started in 1994 after the completion of the Marmara LNG terminal. In 1995, natural gas represented 8% of the total final energy consumption. Gas sales started at 0.5 Bcm (billion...

For at least the last decade, evaluation of the benefits of research, development, demonstration, and deployment (RD3) by the U.S. Department of Energy has been conducted using deterministic forecasts that unrealistically presume we can precisely foresee our future 10, 25, or even 50 years hence. This effort tries, in a modest way, to begin a process of recognition that the reality of our energy future is rather one rife with uncertainty. The National Energy Modeling System (NEMS) is used by the Department of Energy s Office of Energy Efficiency and Renewable Energy (EE) and Fossil Energy (FE) for their RD3 benefits evaluation. In order to begin scoping out the uncertainty in these deterministic forecasts, EE and FE designed two futures that differ significantly from the basic NEMS forecast. A High Fuel Price Scenario and a Carbon Cap Scenario were envisioned to forecast alternative futures and the associated benefits. Ernest Orlando Lawrence Berkeley National Laboratory (LBNL) implemented these scenarios into its version of NEMS, NEMS-LBNL, in late 2004, and the Energy Information Agency created six scenarios for FE in early 2005. The creation and implementation of the EE-FE scenarios are explained in this report. Both a Carbon Cap Scenario and a High Fuel Price Scenarios were implemented into the NEMS-LBNL. EIA subsequently modeled similar scenarios using NEMS. While the EIA and LBNL implementations were in some ways rather different, their forecasts do not significantly diverge. Compared to the Reference Scenario, the High Fuel Price Scenario reduces energy consumption by 4 percent in 2025, while in the EIA fuel price scenario (known as Scenario 4) reduction from its corresponding reference scenario (known as Scenario 0) in 2025 is marginal. Nonetheless, the 4 percent demand reduction does not lead to other cascading effects that would significantly differentiate the two scenarios. The LBNL and EIA carbon scenarios were mostly identical. The only major difference was that LBNL started working with the AEO 2004 NEMS code and EIA was using AEO 2005 NEMS code. Unlike the High Price Scenario the Carbon Cap scenario gives a radically different forecast than the Reference Scenario. NEMS-LBNL proved that it can handle these alternative scenarios. However, results are price inelastic (for both oil and natural gas prices) within the price range evaluated. Perhaps even higher price paths would lead to a distinctly different forecast than the Reference Scenario. On the other hand, the Carbon Cap Scenario behaves more like an alternative future. The future in the Carbon Cap Scenario has higher electricity prices, reduced driving, more renewable capacity, and reduced energy consumption. The next step for this work is to evaluate the EE benefits under each of the three scenarios. Comparing those three sets of predicted benefits will indicate how much uncertainty is inherent within this sort of deterministic forecasting.

The continuous growth of energy consumption, intensive exploitation of non-renewable energy sources, geopolitical turmoil, global recession have resulted in the fact that the days of cheap energy are over. This paper discusses the problems and challenges the energy sector faces, with special emphasis on those related to the oil and gas sector in the world and in our country. Serbian energy policy objectives, established by the new Energy Law, include the promotion of energy security, energy efficiency, competitiveness of the energy market, use of renewable energy resources and environmental protection. With regard to each goal, a series of regulatory measures, programs and acts have been adopted that comply with the requirements of European energy regulations. What follows is an intense work on the implementation of the adopted measures and programs. In terms of the implementation of the energy development strategy, 'Naftna industrija Srbije' (NIS) is the most advanced. Therefore, the focus of this paper is on analyzing the development strategy of NIS in the context of the Energy Sector Development Strategy of the Republic of Serbia.

The MEU GIS-enabled web-platform [1] has been developed in close collaboration with four Swiss cities. The tool enables detailed monitoring and planning for both energy demand and supply at individual building, neighborhood and whole city scale (http://meu.epfl.ch). This web-platform acts like an interface between different tools and allows to establish detailed energy balances for entire cities comprising several thousand buildings. In its present configuration, the MEU tool does not allow yet to simulate energy networks behaviors, based on the real or projected energy demand in an urban zone. In order to meet this need from energy utilities partners, a specific data model, as well as an user-interface giving access to networks attributes and edition/simulation tools were developed, which will be then functionally integrated in the MEU platform. The idea is to create a “Natural Gas Networks” module built for energy utilities. The objectives of this project within the larger MEU endeavor were the following: 1) Create a platform gathering topological and geo-referenced data; 2) Develop a gas network pre-design/planning methodology including demand characteristics and gas supply for buildings in a selected area; 3) Interface with gas distribution system operators existing tools and add new functionalities within a single platform; 4) Include natural gas distribution system operator constraints and operational realities in the pre-design/planning process. In order to achieve those objectives, two tools and several visualization concepts have been created, along with an ad hoc data model: (i) a data model able to allow data import, storage and centralization from energy utilities databases: networks, buildings demands and specifications, as well as interface between edition, simulation and visualization tools; (ii) a network edition tool prototype (LEAFLET JavaScript based web page), which allows to display a network on a map, to add/delete or drag&drop pipes, nodes, consumption and biogas production/injection points and pressure let down stations; (iii) a network flows, and pressures simulation device (MATLAB® compressible fluids model) which computes the network behavior for each hour (pressures, flows, power equivalent and temperatures in each point); (iv) a detailed mock-up for visualization and display concept with interactive and GIS data: buildings area, networks paths, pipes characteristics, results from simulation, studied area energy balance, etc. This paper focuses more specifically on the visualization and network edition tool, as well as simulation results interactive representation on the MEU platform.