The recent report by the Council of European Energy Regulators (CEER) outlines a comprehensive framework for the decarbonisation of liquefied natural gas (LNG) terminals across Europe, with significant implications for South-East Europe. This region, characterized by limited pipeline density and marginal domestic gas production, increasingly relies on a few strategically located LNG terminals to ensure gas security and price stability. The CEER report, while not specifically targeted at South-East Europe, provides essential insights into how these terminals can evolve amid the transition to a lower-carbon energy system.
In South-East Europe, two primary LNG gateways dominate: the Croatian terminal on Krk Island and the Greek system centered around Revythoussa. The Croatian terminal has expanded its regasification capacity to approximately 6 billion cubic meters (bcm) per year, enabling it to supply not only Croatia but also neighboring countries such as Hungary and Slovenia. This evolution from a national project to a regional balancing asset underscores the terminal’s importance in maintaining supply stability during winter months or in response to potential disruptions in pipeline flows.
The CEER report emphasizes that LNG terminals are evolving beyond their traditional role as single-purpose fossil fuel facilities. They are expected to become multi-molecule assets that can handle various low-carbon energy vectors, including biomethane, synthetic methane, liquefied hydrogen, and ammonia. This shift is particularly relevant for South-East Europe, where existing LNG terminals can play a pivotal role in integrating these new energy sources into the regional market.
Moreover, the Greek LNG system has broader regional significance due to its established connections with Bulgaria and other neighboring markets. Initiatives like ApolloCO₂ aim to utilize Revythoussa for capturing and exporting carbon dioxide from industrial sources across South-East Europe. This capability may become crucial as EU climate policies tighten, potentially allowing local industries to maintain operations while adhering to stricter emissions regulations.
The report also addresses the future potential of hydrogen as an energy carrier. While it stops short of designating LNG terminals as default hydrogen hubs, it recognizes the feasibility of adapting these facilities for ammonia and liquefied hydrogen imports. Given Greece’s advantageous position along Mediterranean shipping routes and energy corridors, it could serve as a key entry point for low-carbon molecules from regions such as the Middle East and North Africa.
As South-East European countries strive for deeper integration into EU energy markets, regulatory frameworks will play a critical role in facilitating this transition. The CEER advocates for flexible regulatory approaches that avoid locking terminals into narrow operational scopes. This flexibility is essential if these facilities are to invest in technologies that enhance their capacity for handling diverse energy types while ensuring compliance with EU standards on emissions and market transparency.
From a market perspective, LNG terminals are vital for managing price volatility in smaller gas markets that are vulnerable to external shocks. The flexibility offered by LNG imports has already proven effective in mitigating extreme price fluctuations in recent years. As decarbonisation progresses, these terminals will continue to provide essential security-of-supply functions while adapting to meet evolving regulatory requirements.
Ultimately, the CEER report does not prescribe a singular pathway for South-East Europe but rather presents a range of technological options that regional stakeholders can explore based on their unique circumstances. For industries facing pressures from EU carbon pricing mechanisms, evolving LNG terminals into multi-molecule hubs could foster credible decarbonisation strategies while ensuring compliance with new environmental standards.
The strategic importance of LNG infrastructure in South-East Europe cannot be overstated. As decarbonisation reshapes the energy landscape, timely regulatory actions and investments will be necessary to leverage existing assets effectively. The challenge remains for regional players to translate regulatory guidance into actionable policies that secure cleaner energy supplies and industrial competitiveness amidst an increasingly complex energy transition.
