The European Commission opened an in-depth investigation on Friday 28 February, to determine whether France's regulatory mechanism for natural gas storage is in line with EU state aid rules.
Margrethe Vestager, Executive Vice-President in charge of Competition Policy, said: “Our role is to ensure that the measures taken are cost-effective and preserve competition, so that consumers pay a fair price for natural gas”. France has introduced a mechanism providing for the auctioning of all storage capacities on French territory and covering of storage operators’ costs. There are three storage operators in France (Storengy, Géométhane and Teréga) and the amount of compensation paid was 540 million euros in 2019.
The Commission considers that the regulatory mechanism constitutes State aid. It doubts that the method for valuing regulated assets is sufficiently justified. France did not carry out an independent economic assessment of the market value of the assets at the time of implementation of the mechanism. In addition, the mechanism remunerates investments made before storage operators' revenues were regulated. Finally, the measure could create an incentive for gas suppliers to store gas in France rather than in neighbouring Member States. (Original version in French by Lionel Changeur)