Decentralization of Power Generation and Consumption Model: New Role of Natural Gas

DOI: 10.20542/0131-2227-2018-62-5-62-71
E. Telegina (,
Gubkin Russian State University of Oil and Gas (National Research University), 65, Leninskii Prosp., 119991, Moscow, Russian Federation;
S. Eremin (,
Gubkin Russian State University of Oil and Gas (National Research University), 65, Leninskii Prosp., 119991, Moscow, Russian Federation;
Gubkin Russian State University of Oil and Gas (National Research University), 65, Leninskii Prosp., 119991, Moscow, Russian Federation 


Abstract. The article deals with the effects of production and consumption decentralization on gas markets. It results in a radical change of the energy markets structure, the roles of its actors, their business competences and the dominant trading mechanisms. The main reason causing the process of decentralization is implementation of new disruptive technologies, which provide incremental growth of renewables share in the energy mix, form an interactive business environment and determine the energy transition from a commodity to a service concept. These transformations create new quality characteristics of gas demand in the power sector that should be considered by producers and suppliers. Flexible gas and energy products in the power sector are expected to be in high demand to comply the targets of decentralized energy concept with considerable share of renewables. At the same time, the authors note the change of competition nature in gas markets. In addition to competition between gas and renewables, between gas from different suppliers, including increasing prospects of LNG and unconventional gas, there will a new type of competition, namely among different gas energy products. The suppliers will be competing to meet to the fullest extent possible the needs of consumers in the necessary directions, terms and delivery time. The understanding of this perspective, besides the general theoretical interest, is important in terms of assessing the competitiveness of Russian gas in the world natural gas markets in the next decades. Special attention should be paid on the transformation of the Russian gas export strategy to European direction to manage the newly emerging risks, especially the loss of revenue from gas export to Europe. Actors of gas markets have either challenges or new opportunities under mentioned transformations. 

Keywords: energy markets, renewable energy, energy transition, transactive energy, demand response, smart grid, prosumers, disintermediation, gas and energy products 


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For citation:
Telegina E., Eremin S., Tyrtyshova D. Decentralization of Power Generation and Consumption Model: New Role of Natural Gas. World Eonomy and International Relations, 2018, vol. 62, no. 5, pp. 62-71.

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