On Monday 28 June, the European Commission validated the regulatory mechanism for natural gas storage implemented by France since 2017.
France has introduced a regulatory mechanism for natural gas storage which aims to keep existing storage capacity in operation, which is considered necessary to ensure the security of the country’s natural gas supply.
This mechanism involves auctioning the storage capacity and covering the storage operators’ costs. To this end, when the revenues of these operators are below the level of income defined by the independent energy regulatory authority in France (CRE), the storage operators receive compensation.
In February 2020, the Commission opened an in-depth investigation to verify that the scheme was in line with EU State aid rules.
The Commission’s in-depth investigation revealed that the remuneration method is established independently by CRE and the valuation of the regulated assets in particular leads to a proportionate compensation to limit the effects of the measure on the internal market.
Furthermore, the Commission concluded that the negative effects of the measure in terms of distortions of competition are sufficiently limited to ensure that the overall balance of the measure is positive. (Original version in French by Lionel Changeur)