June 18, 2021 (03:44)

What can be the role of Slovak hydrocarbon energy industry in the decarbonisation of the European economy?

On June 15, professionals from the country’s oil and gas industry gathered in the Slovak city of Žilina to take part in a traditional event of the Slovak Gas and Oil Association (SPNZ) – a conference on “Operational Reliability and Security of Main Supply Systems of the Slovak Republic – gas, oil, water”. Experts and managers of the key enterprises in the industry discussed aspects of the current state and prospects of hydrocarbon energy in the Slovak Republic within two days.

According to SPNZ Adviser Ján Klepáč (former head of the Presidential Administration of the Slovak Republic, deputy head of state regulator of the energy sector URSO), the role of natural gas in meeting the energy needs of the Slovak Republic and the EU will grow in the long run by 2050. At present, the share of natural gas in the EU energy balance is 24%; this figure is expected to grow to 28% by 2050.

Veronika Vohlídkova, Director of the Legislative and Strategic Department of the Czech Gas Association (ČPZ), supports the expert. According to her opinion, the goal of achieving carbon neutrality in the European economy by 2050 is politicized and unjustified in terms of the real state of the economy, energy and development of modern technologies of the gas industry. According to experts, ‘European gas companies are already trying to resolve the dilemma of how to meet their obligations within the EU and at the same time maintain their business in other parts of the world. They try to balance short-term operational needs with long-term policy goals by making risky investments in RES projects’.

According to J. Klepač, the presence of a developed gas transportation industry in Slovakia, which plays an important role in the country’s economy and in meeting its energy needs, does not hinder the effectiveness of the process of reducing CO2 emissions. Thus, in the expert’s opinion, following the closure of the coal industry of Slovak energy in 2023, according to the relative emission indicator of gCO2/kWh, the country can reach 7th place among EU member-states. This position is also contingent upon the traditional features of the Slovak energy sector: the predominant division of the use of nuclear energy in the production of electricity and the use of the natural gas – in the production of heat.

Remaining one of the largest taxpayers in Slovakia, the operator of the Slovak GTS Eustream a.s. in 2020 transported 56.98 billion cubic meters of natural gas and thus covered a third of Russian gas supply into the EU. Domestic demand for natural gas in the Slovak Republic is 5 billion cubic meters (52.75 TWh) per year, which are consumed primarily for the purposes of heat production (2.5 billion cubic meters per year) and in the interests of industry (2.12 billion cubic meters per year).

Natural gas consumption in the industry of Slovakia reaches 40% of total gas consumption in the country, which is much higher than the EU average (33%). The largest industrial consumers of gas are Slovak enterprises in the chemical industry (Duslo a.s. in Šaľa), metallurgical industry (U.S. Steel s.r.o. in Košice), and oil refining (Slovnaft a.s. in Bratislava) industries.

Gas consumption for electricity production in Slovakia, in the growing role of NPPs as the basis of the national energy system (commissioning in 2021/23 of third and forth units of Mokhovce NPP will increase the share of nuclear power generation to 78%), was aimed primarily at balancing RES and is 330 million cubic meters per year.

In terms of the level of development of gas distribution networks, the Slovak Republic ranks second among EU member states (relenting to the Netherlands), 94% of the country’s population has access to natural gas.

At the political level, despite the change of the government, the Slovak Republic has been making consistent efforts to increase the country’s transit role by increasing the level of interconnection of the Slovak GTS with Europe’s regional gas markets. The strategic goal of the energy policy of the Slovak Republic in the conditions of decarbonisation of the EU is to create conditions for maximizing the potential of its own nuclear and gas industries. Hoping for a favorable adjustment of the EU energy mix for the Slovak side, Slovakia stands for an inclusive emission solution based on a combination of nuclear and gas energy capabilities.

Due to the commissioning of new nuclear generation capacity (Mochovce 3, 4) and increasing the capacity of cross-border flows of electricity (in April 2021 two 400kV transmission lines in the direction of Hungary Gabčíkovo-Gönyű-Veľký Ďur and Rimavská Sobota-Sajórovánka were put into operation) the Slovak Republic is aiming to become an exporter of energy and to position itself as an important element of the stability of the European energy system (taking into account the experience of the incident on 08.01.21 in Croatia, ENTSO-E report as of 26.02.2021).

In accordance with the directives of the European Commission, the Slovak side implements projects aimed at reducing the share of hydrocarbons in the gas industry by adding to natural gas methane and hydrogen obtained from RES:

1) Production of biogas and biomethane (by technologies of anaerobic fermentation and thermal gasification). Currently, there are 113 1 MW biogas plants in Slovakia; according to a study by the University of Technology in Nitra, the potential for biomethane production reaches 456 million cubic meters / year;

2) Development of hydrogen technologies and production of “green” hydrogen by electrolysis using RES, “blue” hydrogen through gas reforming processes.

In April 2021, the Slovak Republic adopted a national hydrogen strategy, and Eustream joined the European Hydrogen Backbone initiative, which sees Slovakia as one of the entry points into the CEE transportation network and also Ukraine as a potential exporter of green hydrogen.

Partly at the expense of EU funds Eustream together with Slovak companies SPP-distribúcia a.s. (monopoly operator of gas distribution networks) and NAFTA a.s. (main UGS operator) implements H2Infrastructure and H2Pilot projects. During the implementation of the H2I project, in the period of 2022-24 it is planned to conduct laboratory studies of the impact of hydrogen on the materials of the gas transportation infrastructure; 2024-27 – construction and operation of a research site for the production and transportation of hydrogen on the basis of compressor stations near Veľké Kapušany (point of interstate connection “Uzhhorod” / “Velke Kapušany” on the Slovak-Ukrainian border); 2027-30 – feasibility study of hydrogen transportation and formation of a liquid market for this energy source. The H2P project is exploring the possibilities and limitations of transporting a mixture of hydrogen and natural gas.

3) The use of “low-carbon” natural gas, CO2 emissions of which are reduced through the use of carbon capture, use and storage (CCUS).

Consistently implementing a policy aimed at maximizing the conservation and use of its energy potential, Slovakia potentially may position itself as a CEE energy hub, making efforts to implement modern technologies to reduce the share of hydrocarbons in the gas industry, participating in new products and services in the gas market, offering the neighboring countries new gas transportation opportunities, increasing the potential for electricity exports.

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