The Czech Presidency of the Council of the European Union sent Member States, on Monday 31 October, a first draft compromise on the proposed EU Council Regulation aimed at reducing gas prices.
Unveiled on 18 October (see EUROPE 13045/1), the proposal includes giving the European Commission the possibility to present an EU Council decision establishing a price correction mechanism to limit excessive gas price episodes. This would be a temporary instrument, pending the development of an alternative gas price benchmark to the Dutch TTF (the benchmark currently used in the European gas market).
Stressing the political sensitivity of this proposal, Prague chose not to address it in its first draft compromise. “The Presidency is suggesting to introduce changes only after the seminar on this topic planned for 7 November”, the Czech document states.
The draft compromise does however make some changes to the part of the regulation dealing with joint gas procurement and the part defining default energy solidarity rules (applying in the absence of solidarity agreements between Member States).
Joint procurement
In particular, the Presidency introduces a new paragraph in the article requiring Member States to ensure that fossil gas companies under their jurisdiction participate in the aggregation of demand for a certain quantity of gas (at least 15% of the volumes needed to fill storage facilities - see EUROPE 13044/1). This paragraph clarifies that gas purchasing companies participating in this mandatory demand aggregation process may decide not to purchase gas after the aggregation process. In addition, the gas purchased “may be used also for other purposes than storage filling”, the document adds.
While the Commission’s original proposal provides for the exclusion of Russian gas entering the Member States or Contracting Parties of the Energy Community from the joint purchasing mechanism, the draft compromise extends this provision to all gas supplies originating in Russia. However, it clarifies that Russian companies now under the control of Member States can participate in this mechanism.
Instruments of solidarity
With regard to default solidarity rules in case of emergency in a Member State, the draft compromise adds that Member States are free to decide whether and how to distinguish between essential and non-essential consumption of protected customers. According to the Presidency, a Member State requesting solidarity measures which decides not to make this distinction should not be required to demonstrate that non-essential consumption could be reduced before it can make a request for solidarity. Similarly, a Member State providing solidarity should not be required to distinguish between essential and non-essential customers in determining the amount of gas available for solidarity measures.
While the Commission proposes to allow Member States, on an exceptional and temporary basis, to take measures to reduce non-essential consumption by protected customers, Prague adds a paragraph stressing that “such exceptional measures may be taken only after an assessment carried out by the competent authorities of the Member States with regard to the conditions to determine such non-essential volumes of gas”.
The Presidency also suggests that Member States which are only synchronised with the electricity system of a third country and are asked to take solidarity measures may exceptionally deduct higher volumes of gas from the solidarity offer to be provided in the case where the electricity system is out of sync with the system of that third country. This exception would be valid as long as isolated electricity network services or other electricity transmission services are necessary to ensure the safe and reliable operation of the electrical grid.
The draft compromise also introduces minor changes to clarify the information required when issuing a solidarity request. It increases the deadline for making such a request to 72 hours before the indicated delivery time (compared to 24 hours in the Commission proposal).
See the draft compromise: https://aeur.eu/f/3wk (Original version in French by Damien Genicot)