IDEAS home Printed from https://ideas.repec.org/a/sae/enejou/v43y2022i1p117-138.html
   My bibliography  Save this article

Seasonal Flexibility in the European Natural Gas Market

Author

Listed:
  • Iegor Riepin
  • Felix Musgens

Abstract

This paper focuses on seasonal demand swings in the European natural gas market. We quantify and compare the role of different flexibility options (domestic production, gas storage, and pipeline and LNG imports) to assess European demand fluctuations in monthly resolution. We contribute to the existing literature on seasonal flexibility by addressing the problem with a mathematical gas market optimization model. Our paper provides valuable empirical insights into the decline of gas production in northwestern Europe. Furthermore, we focus on how specific flexibility features differ between pipeline supplies and LNG supplies and between gas imports and storage dispatch. In terms of methodology, we construct a bottom-up market optimization model and publish the complete source code (which is uncommon for gas market models). Furthermore, we propose a new metric—the scaled coefficient of variation—to quantify the importance of supply sources for seasonal flexibility provision.

Suggested Citation

  • Iegor Riepin & Felix Musgens, 2022. "Seasonal Flexibility in the European Natural Gas Market," The Energy Journal, , vol. 43(1), pages 117-138, January.
    • Handle: RePEc:sae:enejou:v:43:y:2022:i:1:p:117-138
    DOI: 10.5547/01956574.43.1.irie
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.5547/01956574.43.1.irie
    Download Restriction: no
    File URL: https://libkey.io/10.5547/01956574.43.1.irie?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
    ---><---

    References listed on IDEAS

    as
    1. Jan Abrell and Hannes Weigt, 2016. "The Short and Long Term Impact of Europe's Natural Gas Market on Electricity Markets until 2050," The Energy Journal, International Association for Energy Economics, vol. 0(Sustainab).
    2. Rolf Golombek & Eystein Gjelsvik & Knut Einar Rosendahl, 1995. "Effects of Liberalizing the Natural Gas Markets in Western Europe," The Energy Journal, , vol. 16(1), pages 85-111, January.
    3. Ruud Egging & Franziska Holz. With support by Victoria Czempinski & Alexandra Lüth & Sebastian Wegel & Jan Zepter, 2019. "Global Gas Model: Model and Data Documentation v3.0 (2019)," Data Documentation 100, DIW Berlin, German Institute for Economic Research.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Chen, Yanhui & Zhou, Xiaoyu & Chen, Shun & Mi, Jackson Jinhong, 2024. "LNG freight rate and LNG price, carbon price, geopolitical risk: A dynamic connectedness analysis," Energy, Elsevier, vol. 302(C).

    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. Riepin, I. & Müsgens, F., 2019. "Seasonal Flexibility in the European Natural Gas Market," Cambridge Working Papers in Economics 1976, Faculty of Economics, University of Cambridge.
    2. Egging-Bratseth, Ruud & Holz, Franziska & Czempinski, Victoria, 2021. "Freedom gas to Europe: Scenarios analyzed using the Global Gas Model," Research in International Business and Finance, Elsevier, vol. 58(C).
    3. Egging, Rudolf G. & Gabriel, Steven A., 2006. "Examining market power in the European natural gas market," Energy Policy, Elsevier, vol. 34(17), pages 2762-2778, November.
    4. Steven A. Gabriel & Supat Kiet & Jifang Zhuang, 2005. "A Mixed Complementarity-Based Equilibrium Model of Natural Gas Markets," Operations Research, INFORMS, vol. 53(5), pages 799-818, October.
    5. Hubert, Franz & Orlova, Ekaterina, 2018. "Network access and market power," Energy Economics, Elsevier, vol. 76(C), pages 170-185.
    6. Elin Berg & Snorre Kverndokk & Knut Einar Rosendahl, 1999. "Optimal Oil Exploration under Climate Treaties," Discussion Papers 245, Statistics Norway, Research Department.
    7. Rademeyer, Maryke C. & Minnitt, Richard C.A. & Falcon, Rosemary M.S., 2018. "Revisiting operating cost in resource extraction industries," Resources Policy, Elsevier, vol. 58(C), pages 159-164.
    8. Ibrahim Abada, 2012. "A stochastic generalized Nash-Cournot model for the northwestern European natural gas markets with a fuel substitution demand function: The S-GaMMES model," Working Papers 1202, Chaire Economie du climat.
    9. Orlov, Anton, 2015. "An assessment of optimal gas pricing in Russia: A CGE approach," Energy Economics, Elsevier, vol. 49(C), pages 492-506.
    10. Riepin, Iegor & Möbius, Thomas & Müsgens, Felix, 2021. "Modelling uncertainty in coupled electricity and gas systems—Is it worth the effort?," Applied Energy, Elsevier, vol. 285(C).
    11. Finn Roar Aune and Rolf Golombek, 2021. "Are Carbon Prices Redundant in the 2030 EU Climate and Energy Policy Package?," The Energy Journal, International Association for Energy Economics, vol. 0(Number 3), pages 225-264.
    12. Möst, Dominik & Perlwitz, Holger, 2009. "Prospects of gas supply until 2020 in Europe and its relevance for the power sector in the context of emission trading," Energy, Elsevier, vol. 34(10), pages 1510-1522.
    13. Berg, Elin & Kverndokk, Snorre & Rosendahl, Knut Einar, 1998. "Gains from cartelisation in the oil market," Energy Policy, Elsevier, vol. 26(9), pages 725-727, August.
    14. Marina Tsygankova, 2007. "The Export of Russian Gas to Europe: Breaking Up the Monopoly of Gazprom," Energy and Environmental Modeling 2007 24000062, EcoMod.
    15. Olufolajimi Oke & Daniel Huppmann & Max Marshall & Ricky Poulton & Sauleh Siddiqui, 2019. "Multimodal Transportation Flows in Energy Networks with an Application to Crude Oil Markets," Networks and Spatial Economics, Springer, vol. 19(2), pages 521-555, June.
    16. Wilson, Patrick Impero, 1997. "Deregulation and natural gas trade relationships: lessons from the Alberta-California experience," Energy Policy, Elsevier, vol. 25(10), pages 861-869, August.
    17. Anis Hoayek & Hassan Hamie & Hans Auer, 2020. "Modeling the Price Stability and Predictability of Post Liberalized Gas Markets Using the Theory of Information," Energies, MDPI, vol. 13(11), pages 1-20, June.
    18. Lise, Wietze & Hobbs, Benjamin F., 2008. "Future evolution of the liberalised European gas market: Simulation results with a dynamic model," Energy, Elsevier, vol. 33(7), pages 989-1004.
    19. Huppmann, Daniel & Egging, Ruud, 2014. "Market power, fuel substitution and infrastructure – A large-scale equilibrium model of global energy markets," Energy, Elsevier, vol. 75(C), pages 483-500.
    20. Olivier Massol & Albert Banal-Estañol, 2014. "Market power across the Channel: Are Continental European gas markets isolated ?," Working Papers hal-02475017, HAL.

    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:sae:enejou:v:43:y:2022:i:1:p:117-138. 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: SAGE Publications (email available below). General contact details of provider: .

    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.