The prices of European natural gas are deflating. But, seen from the Italian industrial world, the energy emergency remains. Indeed, due to high bills, a large part of Italian manufacturing threatens not to reopen its doors after New Year's Eve. A sensational own goal - given that the order books, for once, are full - which the government will try to avert in extremis, even under pressure from Matteo Salvini, who was quick yesterday to rush to the Torbole foundry, in the heart of the Brescia area, to express its solidarity with the representatives of a large part of the Italian processing industry, who have gathered to ask for immediate support in the face of thesoaring cost of electricity (+280% since January, +650% since the beginning of 2020) and, above all, the new upcoming electricity and gas tariffs for the next quarter: barring government interventions, a sting between 40 (for gas) and 50% (electricity) seems to be taken for granted, as anticipated by the president of Arera (the Regulatory Authority for Energy, Networks and the Environment) Stefano Besseghini due to the soaring cost of raw materials.
Based on these numbers, there is very little satisfaction the drop in quotationsions in Europe of natural gas, which slipped this morning below 100 euro MWh against the peak of 187 euro per megawatt hour a week ago (+670% in one year). Partly because the decline is linked to the fact that many cargoes of LNG (liquefied natural gas) have diverted their routes from Asia or the United States and are heading towards the old continent. Furthermore, the mild temperatures of these days in continental Europe also affect the prices. The rains allow hydroelectric plants to operate at full capacity and a recovery of wind generation is underway in Germany. But the situation remains high risk. Partly because the price of natural gas is also rising in the United States because winters are very harsh in some areas of the country. On the border with central-western Canada, record temperatures were reached for the period in the Rabbittkettle station, a good minimum temperature of -51,1°C but also in California where it snows abundantly down to low altitudes.
Much because they remain stronger than ever the geopolitical causes of the crisis just as Davide Tabarelli, director of Nomisma Energy, listed them a few days ago. In summary: “Stockpiles are low, because Russia delivers less gas to Europe. Partly because it wants to push the Nord Stream pipeline, partly because it has transport problems, given that its network is very old. Then there was the recovery in production after the pandemic; China has increased demand for gas to exit coal; energy companies invest more in renewables and less in fossil fuels, but the demand for gas does not decrease; wind and hydroelectric in some countries have reduced production for weather reasons”.
In short, the knot is structural. Admittedly, the pressure on prices could ease in the coming months as inventories build up and, once the cold has passed, the pressure on demand eases. But, beyond the contingency, they emerge the usual problems. Italy, for example, now depends 90% on foreign countries for its overall natural gas needs. Every year the Bel Paese burns 70-75 million cubic meters. In the first nine months of 2021 we used 53,2 billion cubic meters (+6,8%) of which only 2,48 (-20,2%) extracted from deposits in the Po valley, the Adriatic and Sicily, compared of imports from Russia, Algeria and by ship from the Rovigo regasification terminal and the new Tap pipeline.
Meanwhile, with the exception of Argo Cassiopea in the Sicilian channel for which Eni has had the go-ahead for the works and which will supply one billion cubic meters of gas for a decade, several fields have been blocked for years for regulations, appeals, prohibitions and moratoriums. Without considering the 30 billion cubic meters under the seabed of the Upper Adriatic. The current situation is therefore also the price for having made certain choices, as Minister Roberto Cingolani said. “We decided it was better to buy gas from abroad instead of using our own”. “In the next 12-18 months we have to move in other directions as well. Like that of increasing national gas production with fields already open". The current 4 billion cubic meters could be “perhaps doubled”, he explains.
According to a study by Assorisorse, this is possible: the gas fields of Emilia Romagna alone on the mainland and in the Adriatic can double production from 800 million to 1,6 billion cubic meters with an investment of 322 million euros. To extract about 10 billion cubic meters a year for ten years in Italy a couple of billion would be needed. But you have to deal with the Pitesai, which stands for "Plan for the sustainable energy transition of suitable areas" introduced in 2018 by the Conte government which, in reality, has so far been above all an effective tool to prevent the exploitation of national deposits. But until the Pitesai, currently under examination by the Joint Conference, is issued, uncertainty will block investments.
