Positive effects of the EU gas market liberalisation on price and on liquidity now spill over to the Baltic area – a region formerly defined as EU’s ‘energy island’ because no gas infrastructure links then existed between the Baltic States and Finland with the rest of Europe. Technological improvements in off-grid gas supplies will further contribute to market liquidity and competitiveness. At the same time, the Baltic experience reveals that multi-speed gas markets reflect the current modus operandi of the EU Gas Directive implementation. The European Green Deal will have to entail bottom-up policy approaches – primarily involving national and regional action plans - for the successful implementation of the EU decarbonisation strategy by 2050. Regional, economic and cognitive disparities regarding the speed and the magnitude of the ongoing energy transition to carbon-free economy form part of the controversies that will continue to take central stage in the years to come. Growing pressure from society at large to take steps to mitigate greenhouse gas emissions has engendered a reassessment of conventional approaches to the EU’s natural gas sector. Gas industry will need to adapt to new realities and integrate new technological solutions in line with the path towards decarbonisation. However, a question arises about the relevance of previous efforts in building competitive gas markets and interconnections across Europe. Depending on national and regional specificities, natural gas can most likely be considered as one of the options for the energy transition towards carbon-free economy.
Highlights: Current estimates of marginal abatement costs suggest that achieving zero or net-zero emissions requires much higher carbon prices than ever experienced. Depending on how well they are addressed, competitiveness [...]