French gas system can meet domestic, export demand even in cold winter: TSOs

The French gas system is able to ensure that both domestic market and export demand are met this winter even in the event of cold temperatures, grid operators GRTgaz and Terega said Oct. 23 in their latest winter outlook.

The TSOs said that various simulations had shown that the gas system was able to supply French consumers and ensure gas solidarity with neighboring European countries "regardless of the harshness of the coming winter."

They said the outlook was based on "sustained" imports of both pipeline gas from Norway, the Netherlands and Spain, and LNG into French terminals.

In addition, market balance would require "rigorous" management of French gas storage stocks and maintaining energy efficiency at levels comparable to those observed in the previous winter.

"The French network is able to ensure the supplies necessary to cover consumption and transit needs towards Europe even in the event of a sharp drop in temperatures," they said.

However, the grid operators warned that in the event of a late cold snap -- where occasional deficit situations could appear -- the safety margin was low, particularly if storage was overused at the start of winter.

"It is therefore important that market players preserve storage at the start of winter to cover a possible late cold snap and that savings efforts are continued," they said.

As of Oct. 21, France's gas storage sites were filled to 95.1% of capacity, according to the latest data from Gas Infrastructure Europe.

That is a level comparable to previous winters and would be able to cover the consumption of a cold and late winter, the TSOs said in their outlook.

The TSOs also said that last winter, European solidarity was strengthened in France, with net outflows to Belgium, Germany and Switzerland amounting to 83 TWh.

Falling consumption

GRTgaz and Terega said their scenarios for winter 2024/25 took into account supply flows, the production of renewable gas, the high level of storage filling, and recent falls in consumption.

French production of biomethane is forecast at 5 TWh this winter, which corresponds to a nuclear power plant unit, they said.

French gas consumption fell by 11.4% year on year in 2023 to 381 TWh, due mostly to mild weather and continued gas savings, according to GRTgaz.

This confirmed the trend of falling gas demand in France observed since 2021. French consumption fell by 20% between 2021 and 2023.

Gas saving efforts were also incentivized by high European gas prices in recent years.

Platts, part of S&P Global Commodity Insights, assessed the benchmark Dutch TTF month-ahead price at an all-time high of Eur319.98/MWh on Aug. 26, 2022.

Prices are now back closer to pre-crisis levels thanks to healthy storage levels and demand curtailments, though remain high, with Platts assessing the TTF month-ahead price on Oct. 22 at Eur40.81/MWh.

According to a report published last month by GRTgaz, Terega and GRDF, French gas consumption is expected to continue to fall and reach 320 TWh/year by 2030, of which around 20% will be made up of renewable and low-carbon gases.

They said gas consumption in France would follow a trajectory largely compatible with the EU’s Fit for 55 climate objectives, noting green gases would help decarbonize the gas grid and ensure flexibility in the energy system.