Berlin, Brussels The EU Commission wants to standardize the management of natural gas storage facilities within Europe in order to increase security of supply and reduce price fluctuations. It wants to oblige the member states to impose minimum fill levels on the storage operators. By November 1, 2022, the filling level should be 80 percent, and 90 percent in the years thereafter. States without their own gas storage facilities should contribute to the costs of gas storage in other countries.
According to this, operators of gas storage facilities must be certified in order to rule out that they pose a risk to the security of supply. The Commission wants to first target particularly large storage facilities that reported noticeably low filling levels last year. “This could lead to Gazprom storage facilities being considered as a priority,” said a senior Commission official.
If certification is denied, the operators have to meet conditions or sell their shares in the gas storage facilities. With this, the EU Commission is going beyond the plans of the Federal Government. The reason given in the EU Commission’s draft is that distortions on the gas market in the past six months have led to a sharp increase in gas prices. The storage level in the EU at the end of winter was far below the level of previous years. “Last year, utilities waited too long for lower prices. We don’t want to allow that to happen any longer,” said the Commission official.
Gas storage facilities are secured against misuse by other countries
According to the Commission, a total of 1110.7 terawatt hours of gas can be stored in the EU. A filling level of 90 percent would therefore mean around 1000 terawatt hours. That is about a quarter of the average annual consumption.
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The Commission also wants to set intermediate targets and operators should regularly report how much gas they have currently stored. If the values are more than two percent below the specifications, the member states should impose penalties.
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The EU Commission received approval for its plans from the Berlin traffic light coalition, for example from Michael Kruse, the energy policy spokesman for the FDP parliamentary group in the Bundestag: He welcomes “the fact that the EU Commission has recognized the importance of gas storage for energy security and is acting here want,” Kruse told the Handelsblatt. Gas storage facilities would have to be secured against misuse by third countries. “It must not be that countries like Russia secure access to our critical energy infrastructure and use it against us,” said Kruse.
He is committed to the rapid implementation of the filling level specifications for gas storage so that there is already enough gas available for the coming winter. “It is particularly important to me that we in Germany quickly tackle the certification of storage operators. In this way we prevent Russian operators, for example, from using the storage facilities against our interests,” said the FDP politician.
The Federal Ministry of Economics has already submitted the draft of a gas storage law, which partly takes into account the future requirements of the EU Commission. The law is to be passed by the Bundestag on Friday. The draft law also provides for minimum filling levels on certain dates of the year.
However, the German law does not yet take into account the certification of storage owners planned by the EU Commission and the possibility of forcing the owners to sell shares. The German draft law may therefore need to be improved.
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FDP politician Kruse welcomes the course taken by the Brussels authorities: “I think the proposal to withdraw Gazprom’s control over gas storage facilities in Germany and thus improve security of supply is appropriate,” he said.
The point is particularly sensitive from a German point of view: In Germany, three natural gas storage facilities are wholly or partly owned by Russians, including the largest natural gas storage facility in Western Europe in Rehden. It is said in the industry that the filling levels of the gas storage facilities in Germany were already at a low level at the beginning of winter – and not just the filling levels of the three natural gas storage facilities that are wholly or partly in Russian hands.
Electricity should become cheaper
The EU Commission is taking a much more cautious approach to the electricity market. Expensive gas also makes electricity more expensive, although only a small part of electricity is generated from gas. “There is no easy way out of this situation,” said a Commission official. “Changes in the market can disrupt trade within the EU, pose supply risks and become very expensive.”
But at the urging of Spain and France, the Commission is presenting three options at the EU summit on Thursday and Friday for decoupling the electricity price from the gas price: subsidized gas for the operators of gas-fired power plants, a price cap for the wholesale price of electricity, for which the Gas-fired power plant operators would have to be compensated and profits siphoned off from other power plant operators whose costs are lower.
“We cannot continue as before,” confirms electricity market expert Georg Zachmann from the Bruegel Institute. “But the instruments of the market must be preserved. Politicians must make it clear that the interventions are only temporary. Otherwise investments in renewable energy could suffer.”
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