Framework for Countries Evaluating Gas-to-Power Pathways - Goal 2: Achieving Energy Security

Tool
15 February 2024
- Aaron Sayne
- Thomas Scurfield

Download

Key messages

Some lower- and middle-income countries will need gas to achieve energy security, at least in the near term. But too much dependence on gas for energy can destabilize a country’s economy, energy systems and, ultimately, the lives of its people.
Energy security requires government officials to correctly predict energy demand. For gas, this is an especially difficult task. Getting it wrong can have high costs, from electricity shortages to wasted public revenues.
Countries should be realistic about whether they can produce enough gas to fuel power plants for decades to come. Lenders and private energy companies are investing less in new gas extraction. Some countries are also running out of cheap gas, and a switch to extracting higher-cost reserves could force them to increase fossil fuel subsidies or leave consumers to pay more for electricity.
Governments should, as much as possible, not support deals to import gas. Relying on foreign gas ties a country’s energy system to forces and events outside its control. In the worst cases, this can send shockwaves through economies and upend people’s daily lives.
Policymakers and electricity users in gas-producing countries need to fully consider solar and wind as alternatives to gas power, and right-size gas plans accordingly. Both solar and wind have their own challenges, but compared to gas, they can offer lower risks and growing advantages for achieving energy security.

This second part of NRGI’s gas-to-power framework interrogates the claim that producing and burning more gas will allow a country to achieve energy security.

It spotlights two big decisions:

Whether governments and energy companies should try to extract more of a country’s own gas for domestic use, and if so, how much.

Whether governments and energy companies should build more infrastructure to transport, burn or otherwise consume gas, and if so, how much.

Use of gas for electricity generation is the focus, though much of the content also applies to other domestic uses (e.g., industry, heating, cooking).

The module provides background on domestic gas use in lower- and middle-income gasproducing countries, then explores two key challenges that any country wanting to use gas for energy security will have to face: 1) estimating demand for gas, and 2) supplying the gas. For each challenge, it poses some critical questions that stakeholders should ask decision-makers.

Who actually makes these decisions varies by country, and can include heads of state, cabinet and ministerial officials, energy sector regulators, officials at state-owned utilities or other energy companies, parliamentarians, and a range private sector actors.

The module presents some case study-based scenarios of what can go wrong when a country mishandles these two key challenges (without suggesting that relying on gas for energy security will always have negative impacts). It also briefly compares solar and wind power’s potential role in energy security with gas.