European energy planning relies heavily on official forecasts that project natural gas prices will stabilize at relatively low levels during the 2030s. However, recent market conditions demonstrate significant gaps between these projections and actual outcomes. The Dutch Climate and Energy Outlook, for example, assumes wholesale gas prices around €0.20–€0.25 per cubic metre in the 2030s, yet prices in late September were trading near €0.70 per cubic metre—roughly three times higher. This discrepancy raises fundamental questions about the reliability of long-term energy forecasting.
The challenge of predicting gas prices stems from their dependence on numerous interconnected variables beyond standard economic modeling. European gas costs fluctuate based on weather patterns, storage capacity, Asian demand levels, LNG export infrastructure, pipeline disruptions, geopolitical conflicts, shipping routes, currency movements, and decisions by a small number of major suppliers. Recent history illustrates this volatility: Russian supply cuts drove prices above €300 per megawatt-hour in 2022, they declined as global LNG expanded through early 2026, then spiked again above €70 following Middle East disruptions affecting the Strait of Hormuz. Energy analysts are not incompetent, but they face variables that are fundamentally political, meteorological, and strategic rather than purely economic.
The assumed gas price carries outsized importance in energy policy because it determines which investments appear economically justified. Under low-price assumptions, traditional gas infrastructure like boilers and furnaces seem cost-effective compared to heat pumps and renewable energy. Under higher-price scenarios, the same comparison reverses, making efficiency improvements and electrification more attractive. This assumption effectively shapes long-term infrastructure decisions affecting households, industries, and power systems for two or three decades. Gas-price volatility also indirectly impacts electricity costs because gas-fired plants frequently set marginal wholesale prices, meaning fuel-market instability ripples through the entire energy system.
Instead of debating which single price forecast is correct, policymakers should evaluate investments across multiple scenarios including sustained low-gas cases, central cases, prolonged high-gas cases, and shock scenarios. Renewable energy, storage, efficiency improvements, and demand-response systems function as hedges against price uncertainty rather than bets on specific forecasts. These technologies involve known capital costs at the time of investment and do not require purchasing fuel daily at volatile market prices. While gas will likely remain necessary for industrial applications and seasonal balancing during the energy transition, policy should avoid creating new long-term demand based on assumptions of permanently cheap imported gas. The goal is building energy systems resilient across multiple plausible futures rather than optimized for a single forecast that history suggests may prove incorrect.
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