IDEAS home Printed from https://ideas.repec.org/a/eee/appene/v377y2025ipbs0306261924018737.html
   My bibliography  Save this article

Integrating upstream natural gas and electricity planning in times of energy transition

Author

Listed:
  • Olleik, Majd
  • Tarhini, Hussein
  • Auer, Hans

Abstract

Natural gas is projected to play an important role in the electricity sector despite the growing adoption of renewable energy technologies. For developing countries endowed with natural gas resources, integrating electricity and upstream natural gas plans allows them to benefit from the existing synergies between the two sectors in times of energy transition. To assess these synergies, we introduce an integrated upstream natural gas and electricity generation expansion model that considers the upstream sector as a source of revenue to the state. We formulate the model as a non-linear program, then we adopt a grid search technique to solve it. We apply it to the case of Lebanon and we show that for the announced 2030 renewable energy targets, the upstream natural gas sector quasi-always adds value to the state with limited additional emissions. This highlights that the upstream natural gas and the renewable energy sectors could complement each other to reach the desired climate pledges at the lowest costs. In contrast to non-integrated traditional generation expansion models that are highly sensitive to the price of the consumed natural gas, the proposed model shows that the state can maintain a near-optimal position for a wide range of upstream natural gas prices offering the needed flexibility when discussing gas purchase agreements with upstream companies.

Suggested Citation

  • Olleik, Majd & Tarhini, Hussein & Auer, Hans, 2025. "Integrating upstream natural gas and electricity planning in times of energy transition," Applied Energy, Elsevier, vol. 377(PB).
    • Handle: RePEc:eee:appene:v:377:y:2025:i:pb:s0306261924018737
    DOI: 10.1016/j.apenergy.2024.124490
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0306261924018737
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.apenergy.2024.124490?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Zahedi Rad, Vahid & Torabi, S. Ali & Shakouri G., Hamed, 2019. "Joint electricity generation and transmission expansion planning under integrated gas and power system," Energy, Elsevier, vol. 167(C), pages 523-537.
    2. Franco, Alessandro & Salza, Pasquale, 2011. "Strategies for optimal penetration of intermittent renewables in complex energy systems based on techno-operational objectives," Renewable Energy, Elsevier, vol. 36(2), pages 743-753.
    3. Relva, Stefania Gomes & Silva, Vinícius Oliveira da & Gimenes, André Luiz Veiga & Udaeta, Miguel Edgar Morales & Ashworth, Peta & Peyerl, Drielli, 2021. "Enhancing developing countries’ transition to a low-carbon electricity sector," Energy, Elsevier, vol. 220(C).
    4. Dagher, Leila & Ruble, Isabella, 2011. "Modeling Lebanon’s electricity sector: Alternative scenarios and their implications," Energy, Elsevier, vol. 36(7), pages 4315-4326.
    5. Khodr, Hiba & Uherova Hasbani, Katarina, 2013. "The dynamics of energy policy in Lebanon when research, politics, and policy fail to intersect," Energy Policy, Elsevier, vol. 60(C), pages 629-642.
    6. Wang, Chong & Ju, Ping & Wu, Feng & Lei, Shunbo & Hou, Yunhe, 2021. "Coordinated scheduling of integrated power and gas grids in consideration of gas flow dynamics," Energy, Elsevier, vol. 220(C).
    7. Dranka, Géremi Gilson & Ferreira, Paula & Vaz, A. Ismael F., 2021. "A review of co-optimization approaches for operational and planning problems in the energy sector," Applied Energy, Elsevier, vol. 304(C).
    8. Yamchi, Hamid Bakhshi & Safari, Amin & Guerrero, Josep M., 2021. "A multi-objective mixed integer linear programming model for integrated electricity-gas network expansion planning considering the impact of photovoltaic generation," Energy, Elsevier, vol. 222(C).
    9. Vogt-Schilb, Adrien & Meunier, Guy & Hallegatte, Stéphane, 2018. "When starting with the most expensive option makes sense: Optimal timing, cost and sectoral allocation of abatement investment," Journal of Environmental Economics and Management, Elsevier, vol. 88(C), pages 210-233.
    10. Silvana Tordo, 2007. "Fiscal Systems for Hydrocarbons : Design Issues," World Bank Publications - Books, The World Bank Group, number 6746.
    11. Zhao, Baining & Qian, Tong & Tang, Wenhu & Liang, Qiheng, 2022. "A data-enhanced distributionally robust optimization method for economic dispatch of integrated electricity and natural gas systems with wind uncertainty," Energy, Elsevier, vol. 243(C).
    12. Olleik, Majd & Auer, Hans & Nasr, Rawad, 2021. "A petroleum upstream production sharing contract with investments in renewable energy: The case of Lebanon," Energy Policy, Elsevier, vol. 154(C).
    13. Salameh, R. & Chedid, R., 2020. "Economic and geopolitical implications of natural gas export from the East Mediterranean: The case of Lebanon," Energy Policy, Elsevier, vol. 140(C).
    14. Staffell, Iain & Pfenninger, Stefan, 2016. "Using bias-corrected reanalysis to simulate current and future wind power output," Energy, Elsevier, vol. 114(C), pages 1224-1239.
    15. Elie Bouri & Joseph El Assad, 2016. "The Lebanese Electricity Woes: An Estimation of the Economical Costs of Power Interruptions," Energies, MDPI, vol. 9(8), pages 1-12, July.
    16. Prakash, Vrishab & Ghosh, Sajal & Kanjilal, Kakali, 2020. "Costs of avoided carbon emission from thermal and renewable sources of power in India and policy implications," Energy, Elsevier, vol. 200(C).
    17. Zhang, Houwang & Wu, Qiuwei & Chen, Jian & Lu, Lina & Zhang, Jiangfeng & Zhang, Shuyi, 2023. "Multiple stage stochastic planning of integrated electricity and gas system based on distributed approximate dynamic programming," Energy, Elsevier, vol. 270(C).
    18. Jiandong Duan & Fan Liu & Yao Yang & Zhuanting Jin, 2021. "Flexible Dispatch for Integrated Power and Gas Systems Considering Power-to-Gas and Demand Response," Energies, MDPI, vol. 14(17), pages 1-26, September.
    19. Nunes, Juliana Barbosa & Mahmoudi, Nadali & Saha, Tapan Kumar & Chattopadhyay, Debabrata, 2018. "A stochastic integrated planning of electricity and natural gas networks for Queensland, Australia considering high renewable penetration," Energy, Elsevier, vol. 153(C), pages 539-553.
    20. Farrokhifar, Meisam & Nie, Yinghui & Pozo, David, 2020. "Energy systems planning: A survey on models for integrated power and natural gas networks coordination," Applied Energy, Elsevier, vol. 262(C).
    21. Hamdan, H.A. & Ghajar, R.F. & Chedid, R.B., 2012. "A simulation model for reliability-based appraisal of an energy policy: The case of Lebanon," Energy Policy, Elsevier, vol. 45(C), pages 293-303.
    22. Majd Olleik & Hassan Hamie & Hans Auer, 2022. "Using Natural Gas Resources to De-Risk Renewable Energy Investments in Lower-Income Countries," Energies, MDPI, vol. 15(5), pages 1-22, February.
    23. Saravi, Vahid Sabzpoosh & Kalantar, Mohsen & Anvari-Moghaddam, Amjad, 2022. "Resilience-constrained expansion planning of integrated power–gas–heat distribution networks," Applied Energy, Elsevier, vol. 323(C).
    24. Khaligh, Vahid & Anvari-Moghaddam, Amjad, 2019. "Stochastic expansion planning of gas and electricity networks: A decentralized-based approach," Energy, Elsevier, vol. 186(C).
    25. Koltsaklis, Nikolaos E. & Dagoumas, Athanasios S., 2018. "State-of-the-art generation expansion planning: A review," Applied Energy, Elsevier, vol. 230(C), pages 563-589.
    26. Merzic, A. & Music, M. & Haznadar, Z., 2017. "Conceptualizing sustainable development of conventional power systems in developing countries – A contribution towards low carbon future," Energy, Elsevier, vol. 126(C), pages 112-123.
    27. Teichgraeber, Holger & Brandt, Adam R., 2022. "Time-series aggregation for the optimization of energy systems: Goals, challenges, approaches, and opportunities," Renewable and Sustainable Energy Reviews, Elsevier, vol. 157(C).
    28. Dagoumas, Athanasios S. & Koltsaklis, Nikolaos E., 2019. "Review of models for integrating renewable energy in the generation expansion planning," Applied Energy, Elsevier, vol. 242(C), pages 1573-1587.
    29. Nikoobakht, Ahmad & Aghaei, Jamshid & Shafie-khah, Miadreza & Catalão, João P.S., 2020. "Co-operation of electricity and natural gas systems including electric vehicles and variable renewable energy sources based on a continuous-time model approach," Energy, Elsevier, vol. 200(C).
    30. Mazandarani, A. & Mahlia, T.M.I. & Chong, W.T. & Moghavvemi, M., 2011. "Fuel consumption and emission prediction by Iranian power plants until 2025," Renewable and Sustainable Energy Reviews, Elsevier, vol. 15(3), pages 1575-1592, April.
    31. Pfenninger, Stefan & Staffell, Iain, 2016. "Long-term patterns of European PV output using 30 years of validated hourly reanalysis and satellite data," Energy, Elsevier, vol. 114(C), pages 1251-1265.
    32. Ibrahim, Oussama & Fardoun, Farouk & Younes, Rafic & Louahlia-Gualous, Hasna & Ghandour, Mazen, 2013. "Multi-variable optimization for future electricity-plan scenarios in Lebanon," Energy Policy, Elsevier, vol. 58(C), pages 49-56.
    33. Khorramfar, Rahman & Mallapragada, Dharik & Amin, Saurabh, 2024. "Electric-gas infrastructure planning for deep decarbonization of energy systems," Applied Energy, Elsevier, vol. 354(PA).
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Dranka, Géremi Gilson & Ferreira, Paula & Vaz, A. Ismael F., 2021. "A review of co-optimization approaches for operational and planning problems in the energy sector," Applied Energy, Elsevier, vol. 304(C).
    2. Farrokhifar, Meisam & Nie, Yinghui & Pozo, David, 2020. "Energy systems planning: A survey on models for integrated power and natural gas networks coordination," Applied Energy, Elsevier, vol. 262(C).
    3. Masoud Khatibi & Abbas Rabiee & Amir Bagheri, 2023. "Integrated Electricity and Gas Systems Planning: New Opportunities, and a Detailed Assessment of Relevant Issues," Sustainability, MDPI, vol. 15(8), pages 1-32, April.
    4. Østergaard, P.A. & Lund, H. & Thellufsen, J.Z. & Sorknæs, P. & Mathiesen, B.V., 2022. "Review and validation of EnergyPLAN," Renewable and Sustainable Energy Reviews, Elsevier, vol. 168(C).
    5. Wei, Zhinong & Yang, Li & Chen, Sheng & Ma, Zhoujun & Zang, Haixiang & Fei, Youdie, 2022. "A multi-stage planning model for transitioning to low-carbon integrated electric power and natural gas systems," Energy, Elsevier, vol. 254(PC).
    6. Khorramfar, Rahman & Mallapragada, Dharik & Amin, Saurabh, 2024. "Electric-gas infrastructure planning for deep decarbonization of energy systems," Applied Energy, Elsevier, vol. 354(PA).
    7. Elie Bouri & Joseph El Assad, 2016. "The Lebanese Electricity Woes: An Estimation of the Economical Costs of Power Interruptions," Energies, MDPI, vol. 9(8), pages 1-12, July.
    8. Fraunholz, Christoph & Miskiw, Kim K. & Kraft, Emil & Fichtner, Wolf & Weber, Christoph, 2021. "On the role of risk aversion and market design in capacity expansion planning," Working Paper Series in Production and Energy 62, Karlsruhe Institute of Technology (KIT), Institute for Industrial Production (IIP).
    9. Wogrin, S. & Tejada-Arango, D. & Delikaraoglou, S. & Botterud, A., 2020. "Assessing the impact of inertia and reactive power constraints in generation expansion planning," Applied Energy, Elsevier, vol. 280(C).
    10. Yamchi, Hamid Bakhshi & Safari, Amin & Guerrero, Josep M., 2021. "A multi-objective mixed integer linear programming model for integrated electricity-gas network expansion planning considering the impact of photovoltaic generation," Energy, Elsevier, vol. 222(C).
    11. Wu, Xuewei & Zhang, Bin & Nielsen, Mads Pagh & Chen, Zhe, 2024. "Multi-stage planning of integrated electricity-gas-heating system in the context of carbon emission reduction," Applied Energy, Elsevier, vol. 358(C).
    12. Finke, Jonas & Kachirayil, Febin & McKenna, Russell & Bertsch, Valentin, 2024. "Modelling to generate near-Pareto-optimal alternatives (MGPA) for the municipal energy transition," Applied Energy, Elsevier, vol. 376(PA).
    13. Chyong, C K. & Li, C. & Reiner, D. & Roques, F., 2020. "A Portfolio approach to wind and solar deployment in Australia," Cambridge Working Papers in Economics 2077, Faculty of Economics, University of Cambridge.
    14. Zhang, Houwang & Wu, Qiuwei & Chen, Jian & Lu, Lina & Zhang, Jiangfeng & Zhang, Shuyi, 2023. "Multiple stage stochastic planning of integrated electricity and gas system based on distributed approximate dynamic programming," Energy, Elsevier, vol. 270(C).
    15. Phillips, K. & Moncada, J.A. & Ergun, H. & Delarue, E., 2023. "Spatial representation of renewable technologies in generation expansion planning models," Applied Energy, Elsevier, vol. 342(C).
    16. Haugen, Mari & Blaisdell-Pijuan, Paris L. & Botterud, Audun & Levin, Todd & Zhou, Zhi & Belsnes, Michael & Korpås, Magnus & Somani, Abhishek, 2024. "Power market models for the clean energy transition: State of the art and future research needs," Applied Energy, Elsevier, vol. 357(C).
    17. Pavičević, Matija & Kavvadias, Konstantinos & Pukšec, Tomislav & Quoilin, Sylvain, 2019. "Comparison of different model formulations for modelling future power systems with high shares of renewables – The Dispa-SET Balkans model," Applied Energy, Elsevier, vol. 252(C), pages 1-1.
    18. Majd Olleik & Hassan Hamie & Hans Auer, 2022. "Using Natural Gas Resources to De-Risk Renewable Energy Investments in Lower-Income Countries," Energies, MDPI, vol. 15(5), pages 1-22, February.
    19. Marko Hočevar & Lovrenc Novak & Primož Drešar & Gašper Rak, 2022. "The Status Quo and Future of Hydropower in Slovenia," Energies, MDPI, vol. 15(19), pages 1-13, September.
    20. Lukas Kriechbaum & Philipp Gradl & Romeo Reichenhauser & Thomas Kienberger, 2020. "Modelling Grid Constraints in a Multi-Energy Municipal Energy System Using Cumulative Exergy Consumption Minimisation," Energies, MDPI, vol. 13(15), pages 1-23, July.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:appene:v:377:y:2025:i:pb:s0306261924018737. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/wps/find/journaldescription.cws_home/405891/description#description .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.