# EU could face gas shortage next year, IEA warns
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2022-12-12
Category: NEWS
Category URL: https://financedigest.com/category/news
Meta Title: EU faces potential gas shortage in 2023, urgent energy
Meta Description: The EU has enough gas for this winter but could face a shortage in 2023 if Russia cuts supplies further. Urging faster energy-saving actions and renewables
URL: https://financedigest.com/eu-could-face-gas-shortage-next-year-iea-warnshtml

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By Kate Abnett

BRUSSELS (Reuters) -The European Union has enough gas for the winter but could face a shortage next year if Russia cuts supplies further, the International Energy Agency (IEA) said on Monday, urging governments to act faster to save energy and expand renewables.

Despite Russia slashing gas deliveries this year, Europe has averted a severe shortage and started the winter with brimming gas storage tanks – thanks in part to emergency EU measures to fill storage, plus a lucky spell of mild weather and high gas prices that dampened demand for the fuel.

But next year may pose an even tougher test than the energy crunch that has this year hiked fuel bills for [European households and forced](https://www.financedigest.com/european-privacy-watchdog-creates-chatgpt-task-force.html "European privacy watchdog creates ChatGPT task force") industries to temporarily close to avoid crippling gas costs.

If Russia was to cut the small share of gas it still delivers to Europe, and Chinese gas [demand rebounded from COVID-19 lockdown-induced lows](https://www.financedigest.com/samsungs-quarterly-profit-plunges-to-8-year-low-on-demand-slump.html "Samsung’s quarterly profit plunges to 8-year low on demand slump"), the EU could face a gas shortfall of 27 billion cubic metres (bcm) in 2023, the IEA said. Total EU gas consumption was 412 bcm in 2021.

This is a serious challenge,” IEA Executive Director Fatih Birol told a [press conference](https://www.financedigest.com/5-top-tips-when-holding-a-crisis-press-conference.html "5 Top Tips When Holding a Crisis Press Conference") with the European Commission in Brussels.

The shortage could be averted by expanding subsidies and policies to renovate gas-guzzling buildings, replace fossil fuel-based heating with [heat pumps](https://www.financedigest.com/cutting-business-costs-pros-of-using-commercial-heat-pumps-in-2016.html "Cutting business costs: Pros of using commercial heat pumps in 2016") and massively expand renewable energy, the IEA said.

The 100 billion euro ($106 billion) investment this requires would be paid back within two [years through lower](https://www.financedigest.com/spains-inflation-to-be-lower-this-year-than-in-2022-minister.html "Spain’s inflation to be lower this year than in 2022 -minister") gas bills, Birol said.

European Commission President Ursula von der Leyen suggested forming an EU “solidarity fund” to [raise cash for energy investments](https://www.financedigest.com/5-tips-for-raising-investment-as-a-start-up.html "5 tips for raising investment as a start-up") – using both EU money and additional funding sources.

Von der Leyen said the bloc’s gas [supply was “safe for this winter”](https://www.financedigest.com/ceraweek-europe-gas-supplies-to-stay-tight-2-more-winters-equinor-ceo-says.html "CERAWEEK-Europe gas supplies to stay tight 2 more winters, Equinor CEO says") and the 27-country EU was preparing for the next one.

EU country leaders will call for the preparation of [early contingency plans](https://www.financedigest.com/are-the-over-55s-accessing-their-pensions-early-failing-to-plan-for-later-life.html "Are the over-55s accessing their pensions early failing to plan for later life?") for energy supply next winter at a summit in Brussels on Thursday, according to a draft of their meeting conclusions seen by Reuters.

However, [countries are still at odds over how to address high energy prices](https://www.financedigest.com/netflix-cuts-prices-in-some-countries-to-boost-subscriptions-shares-drop.html "Netflix cuts prices in some countries to boost subscriptions, shares drop"). Their [energy ministers hold an emergency meeting on Tuesday to attempt to agree](https://www.financedigest.com/exclusive-repsol-agrees-to-sell-alberta-oil-assets-to-cppib-backed-teine-energy-sources.html "Exclusive-Repsol agrees to sell Alberta oil assets to CPPIB backed-Teine Energy -sources") a gas price cap that has divided the bloc.

Last [month countries held up deals on other measures over the price cap spat – including faster permits for renewable energy projects that will be crucial to replacing Russian](https://www.financedigest.com/russian-services-activity-shrinks-for-third-month-running-in-dec-pmi.html "Russian services activity shrinks for third month running in Dec -PMI") gas and meeting the EU’s climate goals.

($1 = 0.9469 euros)

(Reporting by Kate Abnett, Jan Strupczewski and Bart MeijerEditing by Mark Potter)


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