Politico: EU to stick to gas storage targets despite growing pressure for flexibility

The European Union is set to propose next week that mandatory targets for filling winter gas storage facilities remain in place, despite calls from several member states, including Germany, for more flexibility.

The bloc first introduced emergency gas storage rules during the 2022 energy crisis in response to fears of supply shortages following Russia's invasion of Ukraine, Caliber.Az reports via Politico.

Under the current system, EU countries must ensure their gas storage is 90 percent full by November each year.

These regulations were designed to guarantee sufficient gas supplies during the winter months and mitigate the risk of price spikes. However, several countries argue that the rules are contributing to higher energy prices and have urged for more leniency, particularly concerning the annual targets and the related interim monthly goals.

The issue comes at a critical moment, with the EU unveiling its Clean Industrial Deal plan this week, aimed at supporting struggling heavy industries such as steel, cement, and paper. These sectors are grappling with high energy costs that hamper their global competitiveness, with EU firms currently paying double for energy compared to their US counterparts.

Laura Page, an analyst at the Kpler commodities platform, noted that the EU is entering this winter with its gas reserves more depleted than in 2022 and 2023, after a cold snap and a recent reduction in Russian pipeline gas deliveries via Ukraine. This has intensified pressure on Europe to import more liquefied natural gas (LNG) during the summer, increasing competition with Asia and maintaining high prices, which poses challenges for industries.

As of now, EU gas storage is at 39.5 percent capacity. In response to the pressure to meet storage targets, some countries are subsidising gas purchases. According to an anonymous gas industry insider, ten EU nations and the UK will spend a total of €30 billion this year on filling and storing gas.

The issue is causing concern among EU capitals. During a meeting in Brussels earlier this month, countries including Germany, Italy, Austria, Denmark, Spain, Greece, the Czech Republic, France, and the Netherlands voiced their objections to the current rules. They pushed for either more flexible targets ahead of this winter or for the targets to be made entirely voluntary.

Despite these concerns, the European Commission is expected to maintain mandatory interim monthly targets and the final November goal. However, next week's proposal will offer more "breathing space" and flexibility for EU countries in meeting these targets, according to Commission officials.

The Commission's Clean Industrial Deal also indicated that it would explore "more flexible rules" on gas storage, though further details have not been provided. The proposed changes aim to reduce system stress, avoid market distortions, and support gas refilling at more favourable purchasing conditions, while ensuring energy security for the bloc.

By Aghakazim Guliyev