The European Commission (EC) on Wednesday released a plan to cut natural gas consumption by 15% until next spring, a day after Russia suggested it would resume natural gas deliveries on Nord Stream 1 (NS1) at a reduced rate.
The continent has been girding for the possibility that flows might not resume on the major conduit after annual maintenance ends. Russian President Vladimir Putin told reporters during a visit to Iran on Tuesday that if Gazprom PJSC does not receive a turbine that has been stuck in Canada, then NS1 would likely resume flows at just 20% of capacity. He again cited technical problems feeding the system at a massive compressor station.
The European Union’s executive branch unveiled its gas reduction guidelines for all consumers, noting that nearly half of the bloc’s 27 members have already been affected by reduced Russian deliveries. The Commission could ultimately declare a mandatory reduction in gas consumption if there is “risk of severe gas shortage” or “exceptionally high gas demand.”
The plan focuses on substitution of gas with other alternative energy supplies and overall energy saving to build upon ongoing efforts to stockpile for this winter. It prioritizes consumption to safeguard supply for households and essential users such as hospitals.
While regularly scheduled maintenance is set to end Thursday on NS1, Gazprom cut deliveries by 60% on the system last month citing mechanical issues at the Portovaya compressor station.
The facility includes eight turbines. Only two are operating. Gazprom said it has been waiting on the delivery of a turbine that was sent to Canada for repairs. The company said the equipment has been stuck in the country because of Western sanctions against Russia.
Gazprom said it was forced to take additional units offline while it awaited repairs because time between overhauls on other turbines had expired, and malfunctions were found in that equipment.
Putin added Tuesday that another turbine should also be sent for repairs at the end of this month. “And where will we get a replacement from? We do not know,” he said.
Natural gas had been nominated for Thursday delivery on systems fed by NS1, but that could ultimately shift by the start of the gas day.
At full capacity, the 745-mile NS1 is one of the largest systems for moving natural gas into Europe, carrying roughly 6 Bcf/d. Deliveries were cut to 2 Bcf/d last month and could be again cut to 1 Bcf/d if the repaired turbine is not installed.
Europe imported 45% of its natural gas from Russia in 2021. It rolled out plans earlier this year to diversify its natural gas supplies after Russia invaded Ukraine. It also imposed requirements to fill storage faster ahead of winter, and the EC said Wednesday it would accelerate plans to boost bargaining power by having members purchase gas jointly.
James Waddell, head of European gas at Energy Aspects, said the plan to cut gas consumption could be tough to execute. He told NGI that the power and industry sectors already have done much of what the guidelines call for, adding that he’s “not sure that many industries will be persuaded which have not already reduced output because of high gas and power prices.”
Waddell also said the proposed reductions for the residential and commercial sectors would likely have the biggest impact, “but are very hard to enforce.”
The United States has helped to fill some of the void left by a cut in Russian deliveries. The bulk of American LNG cargoes this year have been delivered to Europe. The benchmark Title Transfer Facility (TTF) again moved higher Wednesday on supply fears and a heat wave that’s testing the continent’s energy infrastructure. TTF continues to trade at about a $10/MMBtu premium to Asian liquefied natural gas prices.
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