Energy Transition

How the European Union can avoid gas shortages in 2023

Empty gas station at night

Europe has made “impressive progress” in reducing its reliance on Russian gas supplies, the IEA says. Image: Pexels/sergio souza

Victoria Masterson
Senior Writer, Forum Agenda

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  • Europe has made “impressive progress” in reducing its reliance on Russian gas supplies, the IEA says.
  • But 2023 could bring new gas shortages – if Russia cuts or stops supplies – and competition grows for gas imports from other countries.
  • Action in five key areas could help the European Union avoid this.

Europe has enough gas for now.

But gas shortages could intensify in 2023.

In its report, How to Avoid Gas Shortages in the European Union in 2023, the International Energy Agency (IEA) sets out practical actions Europe can take to avoid gas demand outstripping supply.

Europe’s energy crisis

When Russia invaded Ukraine, it more than halved pipeline deliveries of natural gas to the EU.

This put “unprecedented pressure” on European and global gas markets, and drove European gas prices to record levels, the IEA says.

Despite this, the EU managed to increase its gas storage levels by a record amount in 2022.

Three factors contributed to this. Russia still delivered 60 billion cubic metres of natural gas to the EU over the year. Europe was able to secure supplies of liquified natural gas (LNG) from countries including the United States. And unseasonably mild weather at the start of Europe’s winter, alongside lower energy use in response to rising bills, also cut demand for gas.

Chart showing the year-on-year change in EU gas demand by sector
Falling gas demand in 2022 helped the EU maintain gas storage levels. Image: IEA

EU gas shortage threat in 2023

So, Europe made “impressive progress” in 2022 reducing its reliance on Russian gas supplies and making sure it had enough gas in storage, the IEA says.

But danger remains. Russian gas deliveries could be “considerably lower” in 2023 – or drop to zero. This could create an even bigger gap in European and global gas supplies than in 2022.

Competition for supplies of LNG could also increase, if demand from China picks up. There’s also no guarantee that Europe’s mild winter temperatures will continue.

As a result, the European Union could face a shortage of 30 billion cubic metres of natural gas in 2023.

The expected changes and additional actions to close the supply-demand gap in EU
The EU could face a shortage of 30 billion cubic metres of natural gas in 2023. Image: IEA

How Europe can close its gas gap

The IEA identifies five priority action areas for the EU.

These are to quicken improvements in energy efficiency; roll out renewables more rapidly; switch to electric heat, especially through heat pumps; encourage behaviour changes and scale-up gas supply.

Under each of these areas, the IEA details further specific actions.

For example, energy efficiency improvements include helping homes and businesses become more energy efficient and accelerating the use of high-efficiency appliances and lighting.

To speed up the deployment of renewable energy installations, suggestions include stronger investor incentives and cutting the time it takes for projects to be approved.

Behaviour changes like turning down thermostats could save the EU an extra 5 billion cubic metres of gas in 2023, the IEA estimates, and actions like awareness campaigns and regulation can promote this.

Chart showing the summary of additional actions required to fill the EU gas supply-demand gap
The IEA identifies five priority action areas to help the EU avoid gas shortages in 2023. Image: IEA

World Economic Forum Energy Transition Index 2022

Energy security is a key focus of the World Economic Forum report, Fostering Effective Energy Transition 2022.

“With the world in the most severe energy crisis since the 1970s, it is critically important to speed up action to put mankind on the path to net-zero emissions while addressing energy security needs,” the authors say.

The report is the latest analysis of the Forum’s Energy Transition Index, developed with professional services firm Accenture. This has tracked more than 100 countries for a decade as they transition towards clean, affordable and secure energy.

Countries that have diversified their mix of energy and their fuel imports have performed best in terms of energy security, the index finds.

The country fuel import diversification
Diversifying fuel imports is a key step to energy security, the World Economic Forum says. Image: WEF
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