“We were under a lot of time pressure” – Klaus Müller defends expensive filling of the gas storage tanks

The federal government had the goal that the gas storage should be 40 percent full by the beginning of February. In mid-January, the filling level is well over 90 percent. Germany’s top energy guardian explains the historically high value primarily with the above-average warm weather.

The temperatures in the first week of January were 5.1 degrees higher than in previous years – gas consumption was correspondingly 38 percent lower than the average. “I have to say clearly: Petrus helped us a lot,” said the 51-year-old.

In 2022, industry and consumers saved 14 percent of their total gas consumption. Müller attributed the majority to companies that switched to other energy sources (“fuel switch”) or reduced production.

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Müller went on to explain: “With private households, one has to say that the weather effect was dominant.” Some consumers saved for financial reasons or environmental concerns. But there were also people who didn’t think about it that much.

Unnecessary alarmism? “No”!

At the Handelsblatt Energy Summit, Müller struck a calmer tone for the first time since taking office in March 2022. In April, the head of the Bonn authority had warned of “terrible consequences for companies” with regard to the Russian war of aggression in Ukraine. In June he warned that “shock waves would go through the country” in Germany.

Müller’s brief answer to the question of whether he had spread unnecessary alarmism is “no”. In the summer, Russia gradually reduced gas deliveries through the Nord Stream 1 pipeline. At that time, social and economic concerns about a gas shortage were great, said the former Green Party politician and head of the consumer center.

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Bundesnetzagentur President Klaus Müller (left) in conversation with Handelsblatt editor Michael Scheppe.

At that time, neither the mild weather nor the “record speeds with which we launched the LNG terminals” were foreseeable, argues Müller. So far, Germany has put two LPG terminals into operation to compensate for the lack of gas supplies from Russia.

Just because the problem didn’t occur, some would have the feeling that they might have done too much, comments Müller: “But it’s not like that. This is how we averted the crisis in the first place.” A gas shortage would have led to “absolute upheavals” economically and socially.

Decisions under great time pressure

Müller also defended himself against allegations that the high levels had been bought too expensively. In the summer, the federal government commissioned Trading Hub Europe GmbH (THE) to procure gas for the storage facilities because the levels were too low at the time. The company is responsible for the market area for the whole of Germany and paid around eight billion euros for the filling of German gas storage facilities by the end of September.

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Industry experts consider this amount to be excessive. Accordingly, costs of ten to 20 percent could have been saved if THE had not only acted on the short-term spot market, but also on the futures market. The spot market is about the immediate delivery of gas, while on the futures market the delivery time can be agreed at a specific gas price.

“It’s easy to forget that we made the decision under great time pressure and in a situation in which the market suffered from extreme uncertainty and where I had a visit from the who’s who of the German gas industry,” counters Müller. It was right to make that decision.

Worry about the coming winter

Nobody was prepared last summer to optimally manage the crisis. However, Müller admitted that “probably a better decision could have been made”. There are plenty of opportunities on the stock exchanges to process transactions more efficiently than THE was allowed to do at the time. Müller announced an expert opinion to review the purchasing policy.

If we all try very hard, we also have a chance of surviving next winter without a gas shortage. Federal Network Agency President Klaus Müller

Müller looks to the 2023/24 heating season with greater concern: “The possibly harsher winter is the next.” Every percentage point more fill level now helps to be better prepared for the next cold season. If the market doesn’t refill the gas storage facilities, THE would do the job again.

“If we all try very hard, we also have a chance of surviving next winter without a gas shortage,” said Müller, especially with regard to private households. He fears that consumers will make fewer savings efforts in the second winter of the crisis. He compared this to the pandemic: In the second year of Covid, fewer citizens adhered to the restrictions.

Müller wants to encourage consumers to save by informing them more regularly about their gas consumption and costs: “Most people look at it once a year – that’s not enough.” Citizens would also often drive past gas stations, annoyed at the price and change their behavior. At the same time, Müller emphasized that the Federal Network Agency “is not a living room police force and does not want to become one”.

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