By Paul Homewood
h/t Ian Magness
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The Guardian is getting worked up about the new wave of LNG projects being built.
They write:
A $200bn wave of new gas projects could lead to a “climate bomb” equivalent to releasing the annual emissions of all the world’s operating coal power plants, according to a report.
Large banks have invested $213bn into plans to build terminals that export and import gas that is chilled and shipped on ocean tankers. But a report has warned that they could be more damaging than coal power.
You can read the full story here:
Developing new LNG is of course very profitable, given the disruption of Russian supplies of gas and increasing global demand. Prices of natural gas are still high historically, but increasing supply will naturally bring prices back down again, which led the Guardian to comment:
This glut is expected to lead to falling fossil fuel prices, which could encourage a greater reliance on cheap gas in favour of renewable energy technologies and energy efficiency improvements, throwing climate targets further into doubt.
The IEA has predicted that the price of gas imported into the EU is expected to plunge from a record average high of more than $70 (£54) per million British thermal units (MBtu) in 2022 to $6.50 (£5) by the end of the decade, following a boom in planned gas projects in recent years.
If prices do fall to £5, this would only take us back to where they historically stood for a number of years before 2020.
In other words, the actual cost of gas from a production viewpoint is much lower than the current price, which is inflated because of an imbalance of supply and demand.
In turn, this makes a nonsense of the renewable lobby’s claim that renewables are much cheaper than fossil fuels.
Thanks to Ed Miliband, the UK will rapidly be locked into permanently high energy prices, while the rest of the world enjoys the benefits of cheap gas.
