In 2022, before Russia’s full-scale invasion of Ukraine, gas represented about a quarter of gross energy consumption in the EU, the highest shares being in Italy, the Netherlands and Malta (all around 40%). In the same year, over 20% of the EU’s electricity and almost 40% of its heat were produced from gas. Given that the EU imports more than 80% of its gas, a secure supply is essential to maintain the economy and ensure prosperity.
The rapid phase-out of gas imports from Russia in 2022 (45% of EU gas imports at that time) created a supply crisis, which in turn triggered an affordability crisis. In August 2022, wholesale gas prices reached a peak of €339 per megawatt-hour (MWh), up from €51 per MWh in August 2021.
The European Commission anticipated the gas crisis when in 2014 it modelled the effects of a cut-off in Russian gas supplies. The Commission expected rising gas prices to trigger a reduction in demand and increase imports of LNG, which would be distributed to the markets most affected by gas shortages. This is broadly what has happened since early 2022. However, this should not be taken to mean that the EU was fully prepared for the current crisis or that there is no risk to gas supply security in the next few years.
Our auditors looked at the EU’s legal and financial framework for gas supply security and its response to the gas crisis triggered by the war in Ukraine. Their findings and recommendations on how to enhance gas supply security will be published on the ECA website on Monday 24 June.