Natural Gas

Natural Gas

The Role of Natural Gas

Following coal, gas stands as the second most significant source of emissions in the power sector.

In the near term, it plays a crucial role in enhancing the flexibility of the power system to integrate a substantial increase in wind and solar energy.

Nevertheless, unmitigated gas (gas without carbon capture and storage) should be gradually phased out by 2040 to transition towards a cleaner power system.

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Long-Term Trends

Natural gas generation has experienced significant growth
over the past two decades

In the past two decades, natural gas production has increased by 2.3 times, going from 2,718 TWh in 2000 to 6,336 TWh in 2022. Gas generation in 2022 reached its second-highest level, coming close to the 2021 record of 6,348 TWh. The share of gas in the energy mix rose from 18% in 2000 to 23% in 2015 before slightly decreasing to 22% in 2022.

Over the past twenty years, only three calendar years saw a decline in gas generation: 2013 (-2.1%, -105 TWh), 2020 (-0.8%, -50 TWh), and 2022 (-0.2%, -12 TWh). While the drop in gas generation in 2022 was not as significant as in the other two years, it may be indicative of the impact of the global gas crisis.

From 2000 until the signing of the Paris Agreement in 2015, gas generation doubled, reaching 5,463 TWh in 2015, with an average annual growth rate of 4.8%. However, since 2015, the growth rate has slowed to an average of 2.1% per year.

Half of the G20 countries have increased the share of gas in their energy mix since 2015. Notable examples include Saudi Arabia, where the gas share increased from 46% in 2015 to 61% in 2021, Italy from 39% to 51% in 2022, Germany from 9.9% to 17%, France from 3.7% to 9.2%, the US from 33% to 40%, and South Korea from 22% to 28%.

On the other hand, Brazil's gas share fell from 13% in 2015 to 7% in 2022, Türkiye's from 38% to 23%, India's from 4.9% to 2.7%, Japan's from 40% to 34%, and Russia's from 49% to 43%.

Progress Towards Net Zero

According to the IEA Net Zero Emissions scenario, the global community needs to decrease gas generation, aiming to reach a total of 4,977 terawatt-hours (TWh) by 2030 in order to limit the rise in global temperatures to 1.5 degrees Celsius.

In this envisioned scenario, gas would make up 13% of the global power mix by 2030, necessitating an annual decline of 3% in gas generation from 2021 to 2030.

While gas generation has historically experienced steady growth, the pace of this growth has slowed since 2015. The gas crisis in 2022 may mark a pivotal moment, exposing vulnerabilities in the global gas supply chain and prompting many countries to reassess the role of gas in their power mix.

The potential acceleration of clean electricity growth could further expedite the decline of gas in the coming years.