EEM 2020 – WEGA and MInGa – Considering regional transmission capacities for global gas market models

Natural gas plays an important role in the European energy mix [1]. Its fields of application are diverse. To analyze global gas flows and gas prices SWM is using the WEGA gas market model [2, 3, 4]. This model works with perfect foresight and full competition and uses Linear Programming. It optimized worldwide gas flows in daily resolution and the worldwide gas markets are mapped with the help of different types of nodes and edges. For example, a demand zone is a node that can be a country, a region or a trading point.

Nevertheless, significant changes in European gas flows will occur in the future: less indigenous production, more imports of liquefied natural gas (LNG), additional gas flows via Nord Stream 2. It is also possible in the future, that small proportions of green or blue hydrogen will be mixed into the gas flows. The effects of these changes on gas prices and gas flows can be calculated with WEGA. However, analyses on the level of districts to discover regional bottlenecks are not possible. Thus, in this paper, a model coupling to the regional gas market model MInGa [5, 6] is performed.

The gas market model MInGa of the FfE describes the gas sector using as well linear optimization to minimize the economic total costs. Running a simulation results in a cost-optimized use of the gas infrastructure, containing gas production fields, LNG-terminals, European pipelines and storages. The regionalisation of the elements is performed on NUTS II level. A central input parameter for MInGa are regionalized gas consumption and transport capacities, which are therefore explained in detail in this paper.

To analyze potential regional bottlenecks for a given scenario in Central Europe, the coupling of the models is performed as shown in Figure 1. First, WEGA calculates worldwide daily gas flows and delivers these gas flows at the borders of Central Europe to MInGa. MInGa, then, finds the optimal way to contribute the gas within the area on NUTS II level.

It was shown that the model coupling is viable. The analysis at the regional level demonstrates that there is potential for bottlenecks in some regions. However, for the base case scenario no real bottlenecks can be identified, which results in very similar gas flows in WEGA and MInGa. The base case scenario does not consider injection of hydrogen into the gas pipelines. The next step is to analyze more advanced scenarios with the methodology from this paper to identify possible spots for power-to-gas plants or potential bottlenecks for an existing hydrogen scenario.

The published paper can be found here.

Figure 1: Algorithm to couple WEGA and MINGA

[1] Eurostat: Energy balances sheet – 2017 data (2019 edition), available online: https://ec.europa.eu/eurostat/de/web/energy/data/energy-balances.
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[3] Günther, M.; Nissen, V.: Impact of Nord Stream 2 on Gas Flows in Europe, in: 16th International Conference on the European Energy Market (EEM), IEEE Xplore, no. 388, 2019.
[4] Günther, M.; Fallahnejad, M.: Analysis of NCG prices under different shapes of oil price recovery with a worldwide gas market model, in: Handbook of Energy Finance. Theories, Practices and Simulations, 2020, in press.
[5] Kern, T.; Eberl, B.; Lencz, D.; von Roon, S.: Modellierung des europäischen Gasmarkts zur Darstellung verschiedener Gasimportszenarien, in: 10. Internationale Energiewirtschaftsta­gung (IEWT), 2017.
[6] Kern, T.; Buchwitz, K.; Guminski, A.; von Roon, S.: The impact of electrification on the gas sector, in: 15th International Conference on the European Energy Market (EEM), 2018.