Impending Natural Gas Supply Glut and Biogas Developments in Europe: Economic and Environmental Implications

Abstract

The recent trend in the global energy consumption as a result of growing demand from rapidly industrializing countries such as China, India, Brazil, etc. have called for an urgent need to find an alternative and economical source of energy. Natural gas from various sources (conventional, non-conventional) has long been touted as a potential replacement for heavily-polluting crude oil and coal. The recent development in natural-gas production has seen output from non-conventional sources such as shale bed increasing significantly in countries with substantial investment in pipeline and technology for the exploitation and production of gas from this new source such the US. This has created a gas boom in countries with a head-start in tapping into this economical but environmentally controversial source, as well as a slump in global natural-gas prices. In Europe, there has been a stiff opposition to gas production from non-conventional sources such as shale gas on environmental ground, and the focus here is on securing gas supply from existing conventional sources through long-term contracts with major gas suppliers as well development of environmentally friendly alternatives such as biogas from biomass. This paper examines the effects of the impending natural-gas supply glut in the global energy market with respect to biogas developments in Europe and environmental aspects of both sources of energy.

Keywords: Natural gas; Biogas; Shale gas, Substrates.