In the framework of the proposed EU regulation on gas storage, the French Presidency of the EU Council transmitted to the Member States, on Friday 22 April, a draft compromise including the possibility to count Member States’ liquefied natural gas (LNG) stocks towards their objective of filling the gas reserves located on their territory.
Presented by the European Commission on 23 March in order to prepare the EU for possible disruptions to its gas supply as a result of the war in Ukraine, the proposed regulation would require EU countries to ensure that underground gas storage facilities on their territory are filled to at least 80% of their capacity by 1 November 2022, and then to 90% for the following years, through filling trajectories (see EUROPE 12917/7).
For Paris, it should be possible to partially meet this target by counting the LNG stored in Member States’ facilities.
The Presidency nevertheless links this possibility to the fulfilment of at least one of the following three conditions: (1) the gas system is highly dependent on LNG, which supplies more than X% of national demand (the percentage is not yet defined in the draft compromise); (2) the aggregate withdrawal capacity in underground facilities is small compared to the overall storage capacity, which makes it impossible to withdraw a volume of gas equivalent to 90% of the underground storage capacity during the winter season; (3) the availability of booked LNG is guaranteed by storage obligations in LNG tanks.
Details of the filling target
The draft compromise also introduces new elements regarding the obligation to fill storage facilities for those Member States that have them.
According to the French text, this obligation should be limited to 35% of the average annual gas consumption of the last 5 years in the Member State concerned.
It also clarifies that storage facilities in one Member State that are primarily used as a source of gas supply for consumers in one or more other Member States are excluded from the filling target and the filling trajectory.
In addition, Paris proposes to review the way in which national filling trajectories are set and how to define when they are not respected.
In the draft compromise, it would be up to each Member State with storage facilities to send the Commission the technical information determining its filling trajectory by a certain deadline (not yet indicated in the text).
On the basis of this information and taking into account the assessment of the ‘Gas Coordination Group’, the Commission would be required to adopt implementing acts to set each Member State’s individual filling trajectory, whereas the original text proposed to do so through delegated acts.
Deviation from the filling trajectory
According to the French document, the competent national authorities would be required to take effective measures without delay to increase the filling rate of the gas stocks of the Member State concerned, if this rate is more than five percentage points below the level of the Member State’s filling trajectory (as opposed to two percentage points in the Commission’s proposal).
Where, for technical reasons, one or more underground storage facilities cannot be sufficiently filled before 1 December, the Member State would be obliged to inform the Commission of the alternative measures to be taken in order to maintain an appropriate level of security of gas supply.
Effort sharing
Paris also proposes new arrangements for effort sharing between Member States.
While the Commission’s text provides for an obligation for countries without underground storage facilities to ensure that a level corresponding to at least 15% of their annual gas consumption is stored in other Member States by 1 November, the draft compromise adds that this obligation may exceptionally be fulfilled by the equivalent storage of alternative fuels “in the event, that exceptional and justified technical limitations do not allow the above obligation to be met”.
Exemption
In addition, the French Presidency suggests granting Cyprus, Malta and Ireland an exemption from the provisions on stockholding obligations and effort sharing, as long as these countries are not directly interconnected to the grid of a continental Member State.
The Member States’ ambassadors to the EU (Coreper) will meet on Wednesday to discuss the issue again.
See the draft compromise: https://aeur.eu/f/1cs (Original version in French by Damien Genicot)