Overview of the development of China's natural gas industry under the background of carbon neutrality

1 The role and prospects of natural gas in the energy system

Since the goal of "carbon neutrality" was proposed, many institutions and scholars have conducted research on the role and prospects of natural gas in China's energy system.

1.1 The role of natural gas in the "carbon neutral" process

China's energy structure is dominated by coal, and coal has long been in the leading position in the primary energy structure. In the context of the rapid growth of energy consumption in China, the use of low-carbon or non-fossil energy to replace high-carbon emissions of coal is one of the important means to reduce carbon dioxide emissions. Hong Tao [1] believes that deep electrification and high permeability green hydrogen will take a long time to achieve, and the use of low-carbon natural gas instead of coal in the medium term will greatly promote the realization of the "dual carbon" goal. Luozuo County [2] pointed out that coal must be reduced to reduce carbon, and the focus of coal reduction is to use gas electricity, renewable energy and nuclear power to replace coal electricity. Because large-scale energy storage technology has not yet been broken through, the lack of stability of renewable energy power generation is more prominent, and nuclear power is difficult to use on a large scale due to safety issues. In contrast, natural gas power generation has the advantages of stable resource supply and mature technology, and the use of natural gas to replace coal is a realistic choice for China to achieve "carbon peak" before 2030. Zhang Rongwang [3] pointed out that non-fossil energy cannot fully meet China's huge energy volume in the short term due to factors such as peak load capacity and application scope. Although natural gas is a fossil energy, in the case of equal calorific value, carbon emissions are reduced by about 45% than coal, which is a realistic choice to ensure energy security and energy structure transformation in the near future, and will play a bridge and support role in energy transformation. Duan Yanzhi et al. [4] pointed out that the proposal of the goal of "carbon neutrality" will accelerate the development of green energy such as wind energy, while the efficient and flexible characteristics of natural gas can be used to make up for the disadvantages of other green energy, so the large-scale use of wind energy will promote the growth of natural gas consumption in the long run. According to the research of Zhou Shuhui et al. [5], the role of natural gas in the path of "carbon neutrality" can be divided into four stages: from 2020 to 2030, natural gas will exert its low-carbon characteristics to help "carbon peak"; From 2030 to 2035, natural gas will enter a stage of integration with renewable energy; Full integration of natural gas and renewable energy in 2035-2050; From 2050 to 2060, natural gas will continue to play a supporting role for renewable energy.

1.2 Forecast of natural gas supply and demand

1.2.1 Forecast of natural gas consumption

According to the research of Zhou Shuhui et al. [5], in the carbon neutral scenario, China's natural gas consumption will peak at about 6 500×108 m3 in 2035, then have a plateau period of 5 to 10 years, drop to 5 500×108 m3 in 2050, and still remain at 4 300×108 m3 in 2060. Li, Children and Children [6] projected China's natural gas consumption in three scenarios. Although the results were slightly different, the peak time of natural gas consumption in the three scenarios was close to the peak: the peak time was about 5 000×108 m3, and the peak time was around 2035. Gao Zhenyu et al. [7], starting from the terminal consumption of natural gas and forecasting the consumption of natural gas by industry, predicted that the total consumption of natural gas in China would reach 6 000×108 m3 in 2035. Zhang Rongwang [3] believes that China's natural gas market will continue to grow during the 14th Five-Year Plan period. It is estimated that the total consumption of natural gas in 2025 will be about 4 500×108 m3, and the total consumption of natural gas in 2030 will be about 6 020×108 m3, and the peak consumption will come around 2045. Hong Tao [1] believes that China's natural gas consumption will peak around 2040, with a peak value of about 6 000×108 m3, accounting for less than 15% of the primary energy. According to the International Energy Agency's World Energy Outlook 2020 [8], under the scenario of sustainable development, China's natural gas consumption in 2025, 2030 and 2040 will be 3 980×108 m3, 4 460×108 m3 and 5 110×108 m3 respectively. According to the report "Research on China's Low-carbon Development and Transformation Path" released by Tsinghua University in October 2020 [9], under the 1.5 ℃ scenario, natural gas consumption will peak at 5,800 ×108 m3 around 2030 and drop to 3,380 ×108 m3 in 2040. In 2050, it will drop to 1 500×108 m3. In the "Road to Zero Carbon: The 14th Five-Year Plan Opens a New Chapter in China's Green Development" [10] enhanced action scenario released by the World Resources Institute in December 2020, China's natural gas consumption in 2050 will be about 4,600 ×108 m3, a slight increase over the consumption scale in 2030. In the net-zero emission scenario of BP's World Energy Outlook (2020 Edition) [11], peak gas demand is 5,020 ×108 m3 in 2030 and 4,670 ×108 m3 in 2050. According to China Energy and Power Development Outlook [12] released by State Grid Energy Research Institute Co., LTD., under the scenario of accelerated electrification, the demand for natural gas will peak around 2040 at a peak level of about 6 000×108 m3 and drop to 4 400×108 m3 in 2050. In 2060, it will be reduced to 4 100×108 m3. According to the Research Report on China's Carbon Neutrality before 2060 released by the Global Energy Internet Development Cooperation Organization [13], in the context of carbon neutrality, China's natural gas consumption will peak in 2035, with a peak consumption of about 5,000 ×108 m3.