Industry, transport and the heating sector in Germany will need significantly more hydrogen than the current 57 Terrawatt-hours (TWh) per year, produced almost entirely from fossil fuels. Come 2030, the demand for green hydrogen and derivatives will be around 80 TWh and could surge to 300 TWh by 2040, the Fraunhofer institute forecasts.
Strengthening economics of coal-to-gas switching has pushed up prices at the TTF, Europe’s most liquid gas trading hub. With carbon and coal prices up by 33% and 26%, respectively, TTF gas prices increased $3/MMBtu to nearly $9/MMBtu. Restriction to coal-burn also boosts the dispatch of gas-fired power plant in South Korea and Taiwan.
Japanese turbine maker Mitsubishi Power has set up the ‘Gas Turbine Combined Cycle EMEA Business Unit’ in Dubai to sell more J-series air cooled (JAC) turbines into Europe and the Middle East. JAC turbines can operate on a 30:70 fuel mix of hydrogen and natural gas, and are meant to run fully on hydrogen in the future.
Developers of LNG-to-Power projects are advised to secure flexible gas delivery terms through an aggregator before the market flips again and demand outstrips supply. According to Watson Farley & Williams, this is likely to happen by 2022 or 2023 as current Capex cuts delay new liquefaction projects.
US natural gas production has slowly recovered from a plunge in February when a record-breaking cold snap caused production freeze-offs at US oil and gas wells, sending wholesale electricity prices soaring. Texas suffered blackouts and fuel supply shortages, as the state’s gas production fell 4.3 billion cubic feet per day (Bcf/d), or 15%, to 21.5 Bcf/d.