If Europe wants to ramp up liquefied natural gas imports from the US as President Trump has insisted it should, it may have to shuffle its supply lines or re-assess its green energy targets.

If some gas demand reduction forecasts prove accurate, this could hold true even if all imports of Russian gas cease as planned.

Brussels wants to definitively end its energy dependency on Russia by the end of 2027, and has been mulling the extent to which the bloc may be able to comply with Trump’s demand that the EU balance its trade in goods by buying more oil and LNG.

Ursula von der Leyen’s suggestion that Europe could buy more American liquified natural gas (LNG) – made before an intensifying trade war that is now clouded by the threat of 50% tariffs – looks on face value like the right stone to kill two birds.

The trouble is, there is some doubt as to whether the EU actually needs more US gas – or more gas at all.

Hopes and figures
The Russian gas phase-out is proposed in the REPowerEU roadmap, a plan to end all energy imports from Moscow that was presented on 6 May. Despite the war, these gas imports have continued. Pipeline flows dropped drammatically, LNG imports rose. Russian pipeline and LNG imports totalled some 50 billion cubic metres (bcm), or 19% of EU imports, last year.

With the last Ukrainian pipeline now closed, the bloc expects Russian gas imports to drop by some 15 bcm already this year.

In its roadmap, the EU executive estimates the bloc can cut demand by “more than 15bcm of gas per year, reducing the EU overall gas demand by 40-50bcm by 2027”. Moreover, if current laws and plans are fully implemented, the bloc can “replace up to 100 bcm of natural gas by 2030”.

Between 2022 and 2024, Europe’s gas consumption dropped by 80 bcm compared to 2021 levels. The fall was precipitated by soaring energy prices coupled with emergency legislation in the wake of Russia’s invasion of Ukraine – and record levels of renewable energy deployment.

But in 2024, EU gas consumption ticked up by 2bcm compared to 2023, bringing the total to 332bcm. With EU domestic production limited, the lion’s share of it was imported.

Realistic forecasts?
Ana Maria Jaller-Makarewicz is lead energy analyst at the Institute for Energy Economics and Financial Analysis (IEEFA). She told Euractiv that if the EU stays on track with its energy plans, there was “no reason to increase gas and LNG imports from any source” as current imports are greater than the expected EU demand in 2030.

But Andreas Guth, who heads the Brussels-based industry group Eurogas, argues that the REPowerEU roadmap trajectory is unrealistic, and that the bloc will need to secure additional supplies of LNG.

Among the core targets in the original REPowerEU plan – unveiled within weeks of Russia’s tanks pouring across the Ukraine border in February 2022 – were the domestic production of 10 million tonnes of green hydrogen a year by 2030, matched by an equal volume of imports, Guth noted.

By the same date, biomethane should be ramped up to 35bcm, millions of heat pumps deployed to replace gas boilers, and house and buildings insulated at breakneck speed. These objectives are not materialising, Guth told Euractiv in a recent discussion.

The gas sector lobbyist argued that what really drove down gas consumption in the EU, besides record output from wind and solar, were mild winters and “demand destruction” in industry – meaning high energy prices hammering energy-intensive industries across Europe.

“Continuing down this path, from our point of view, is neither realistic nor desirable,” Guth said.

IEEFA’s Jaller-Makarewicz, however, sees it as a question of political will, arguing that demand reduction forecasts are “realistic as long as EU member states are committed to it”.

Demand forecasts
The EU Agency for the Cooperation of Energy Regulators (ACER) has also cautioned against putting too much faith in optimistic forecasts, noting in a report issued on 22 May that so far only solar panels have been deployed at a pace compatible with the RePowerEU objectives.

EU companies have contracted more gas than needed from 2028 to 2030 – but only if the wartime demand reduction plan works. If the EU merely achieves its pre-war renewables, energy efficiency and climate goals – set out in a ‘fit-for-55’ package of legislation named after the 2030 emissions reduction target – it could need more, ACER warned.

The regulatory agency’s recommended accelerating the energy transition to get back on target, but also negotiating flexible LNG contracts to reduce exposure to sudden price changes over the next few years.

On balance, however, ACER says “gas demand is still expected to follow a trajectory closer to the REPowerEU than other scenarios”.

Stick to plans?
So the question of whether to increase US gas imports could be as much political as a matter of energy security, and will be complicated by the need to stick to the EU’s climate mitigation agenda. The European Commission is expected to unveil within weeks a new interim greenhouse gas reduction target for 2040.

So far,  the European Commission has appeared willing to stick to its decarbonisation goals – the 2040 greenhouse gas reduction target will be a litmus test of its determination. The second von der Leyen Commission has committed to following the advice of the EU independent climate advisory board and propose a target of no more than one tenth of 1990 emissions levels.

The second question to answer is how heavily the EU intends to rely on US gas imports at a time when Washington is using unpredictable tariffs to try to impose its will on the global trading system – and treating Europe as an adversary rather than an ally.

Since the 2022 energy crisis, the EU has been buying between 40 and 50% of its crucial LNG supplies from the US.

“Increasing LNG imports from the US will mean the EU is more dependent on one source,” Jaller-Makarewicz said.

(rh, bts)