Liquefied natural gas and gas storage valuation: Lessons from the integrated Irish and UK markets

To guarantee European countries greater access to competitive energy sources, the European Union has identified new infrastructures as Projects of Common Interest (PCIs). This paper aims to evaluate the implications for consumers of new investments in liquefied natural gas (LNG) import capacity and gas storage capacity. We utilise a stochastic mixed complementarity problem model with daily timesteps, incorporating stochastic natural gas supply cost and demand scenarios. Therefore, we assess the expected benefits for consumers of a diversified natural gas supply, and their sensitivity to changing market conditions. We use the integrated UK-Ireland gas system, which represents an ideal framework to evaluate new energy routes. We underscore the complementary of LNG and gas storage investments to manage short-term peak loads and long-term seasonal loads, and reduce energy bills. This study has implications for decision- and policy-makers when addressing new gas infrastructure development and the flexibility of energy systems.