2009 on conditions for access to natural gas transmission networks - Main contents

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dossier	COM(2022)135 - Amendment of Regulation 2017/1938 concerning measures to safeguard the security of gas supply and 715/2009 on conditions for ...
document	COM(2022)135
date	March 23, 2022

(1) While short-term gas supply interruptions have occurred in the past, there are several factors which distinguish the current situation from previous security of supply crises. The escalation of the armed conflict in Ukraine since February 2022 has led to unprecedented price increases. These price increases are likely to fundamentally change the incentives to fill storage facilities in the Union. In the current geopolitical context, further supply disruptions of gas can no longer be excluded. This could severely harm citizens and the economy of the Union, as the Union is still to a significant extent dependent on external gas supplies which can be affected by the conflict.

(2) The nature and consequences of these events are large-scale and Union-wide and therefore require a comprehensive response. The response should prioritise measures that can reinforce the security of supply at Union level, in particular to protected consumers. It is therefore crucial that the Union acts in a coordinated manner to avoid potential risks resulting from a possible gas supply interruption.

(3) Gas storage contributes to security of supply by providing additional supply in case of strong demand or supply disruptions, and well filled gas storage leads to secure gas supplies. Since supply disruptions of pipeline gas may occur anytime, measures regarding the filling level of Union storage sites have to be introduced to ensure supply for the winter 2022/2023.

(4) Regulation (EU) 2017/1938 of the European Parliament and of the Council ⁴ introduced solidarity mechanisms designed to address extreme situations in which supply of protected customers, as an essential security need and a necessary priority, is at stake in a Member State. In the event of a Union emergency, an immediate response should ensure that Member States are able to provide enhanced protection to customers.

(5) The impact of the armed conflict at the borders of the Union has shown that the existing security of supply rules are, however, not adapted to sudden major geopolitical developments, where supply shortages and price peaks may not only result from the failure of infrastructure or extreme weather conditions, but also for instance from intentional major events and longer lasting or sudden supply interruptions. It is therefore necessary to address the sudden greatly increased risks resulting from the current changes in the geopolitical situation.

(6) Based on the Commission’s analysis of adequate measures to secure gas supplies, inter alia, the EU wide reinforced risk preparedness analysis carried out in February 2022 by the Commission and the Gas Coordination Group, it is appropriate that Member States should, in principle, ensure that the storage infrastructures in their territory are full to at least 90% of their capacity at Member State level by 1 November, with intermediary targets for each Member State in May, July, September and February of the following year. This is necessary to ensure that European consumers are adequately protected against supply shortages. For 2022, a lower filling target of 80% and a reduced number of intermediary targets (August, September and October) will apply, taking into account that the Regulation will only become applicable after the start of the gas filling season and Member States have limited time to implement this Regulation.

(7) A “filling trajectory” system shall enable continuous monitoring throughout the filling season (from 1 April to 30 September). From the year 2023 onwards storage shall also be specifically monitored in February (the ‘February control point’) to avoid sudden withdrawal of gas from storage in the middle of the winter, which could cause security of supply challenges before the end of winter.

(8) The filling target and the filling trajectory can be adjusted by the Commission from 2023 onwards, by means of a delegated act, taking into account the annual ENTSOG simulations and the common analysis to be carried out by the regional risk groups defined in Regulation (EU) 2017/1938. The decision of the Commission to set the “filling trajectories” will be taken after consultation of the Gas Coordination Group.

(9) Member States may not always be able to meet the filling targets on time due to technical issues such as problems related to the pipelines feeding the storage site or with the injection facilities. In such cases, it is appropriate that Member States should have the flexibility to meet the target at a later stage. However, the filling target should be met as soon as technically possible and no later than on the 1 December in order to ensure the security of supply for the winter period.

(10) Moreover, Member States may not be able to meet the filling targets in case of an EU-wide emergency, that is in times of extreme scarcity of gas. Therefore, the filling targets should not apply where and for as long as the Commission has declared a Union or regional emergency pursuant to Article 12 of Regulation (EU) 2017/1938.

(11) Competent authorities shall continuously monitor the filling of the underground storage facilities in order to ensure that their national filling trajectories are met. The national filling trajectories are defined considering a bandwidth of two percentage points. If the filling level of a given Member State is more than 2 percentage points below the targets of the filling trajectory, the competent authorities shall immediately take effective measures to increase the filling level. Member States shall inform the Commission and the Gas Coordination Group of such measures..

(12) Substantial and sustained deviation from the filling trajectories can jeopardise reaching adequate levels of storage which are necessary to ensure security of supply in the Union, in a spirit of solidarity. In case of such substantial and sustained deviations, the Commission should therefore be empowered to take effective measures to avoid security of supply problems resulting from unfilled storages. When deciding upon the adequate measures, the Commission shall take into account the specific situation of the respective Member State, such as the size of the storage facilities in relation to the domestic gas consumption or the importance of the storage facilities for security of supply in the region. As this Regulation will enter into force after the start of the storage filling season in 2022, any measures taken by the Commission to address deviations from the filling trajectory for the year 2022 should take into account the limited time for the implementation of this Regulation at national level. The Commission should ensure that the measures do not go beyond what is necessary to maintain security of supply, without putting disproportionate burden on Member States, gas market participants, storage system operators or citizens.

(13) Member States should take all necessary measures to ensure that the mandatory filling targets are met. With a view to the different regulatory regimes already in place in many Member States to support storage filling, no specific instrument to meet the filling trajectory and reach the filling target is prescribed, and Member State enjoy freedom to choose the instrument which is most appropriate in their national system, provided the conditions in Article 6(b)(2) and (3) are respected. Member States therefore have the freedom to choose which market participant(s) to oblige to ensure the filling of the storages. They can also decide whether regulatory means, such as measures to oblige capacity holders to free up unused capacity which are possible under existing EU market rules, may be sufficient to meet the filling targets, or if financial incentives, which might constitute State aid, are necessary. Member States should use coordinated instruments, such as platforms for the purchase of LNG, with other Member States to maximise the utilisation of LNG to fill storages, and reduce infrastructure and regulatory barriers to the shared use of LNG to fill storages.

(14) The Commission Communication COM(2022) 108 final of 8 March 2022, entitled ‘REPowerEU: Joint European Action for more affordable, secure and sustainable energy’ has clarified in this respect that Union law allows Member States to provide State aid to suppliers under Article 107(3)(c) TFEU in order to ensure filling of storages, for example in the form of guarantees (‘two-way contract for difference’).

(15) Any measure taken to ensure the filling of gas storage should be necessary, clearly defined, transparent, proportionate, non-discriminatory and verifiable, and should not unduly distort competition or the effective functioning of the internal market in gas or endanger the security of gas supply of other Member States or of the Union. In particular, such measures taken should not lead to strengthening a dominant position or windfall gains for undertakings controlling storage facilities or having booked but not used storage capacity.

(16) The efficient use of the existing infrastructure, including cross-border transmission capacities, storage facilities and LNG facilities are important factors in ensuring security of supply in a spirit of solidarity. Open energy borders are key for security of supply, also in times of gas disruptions at national, regional or Union level. Therefore, any measure taken to ensure the filling of gas storage should not block or restrict cross-border capacities allocated in accordance with the provisions of Commission Regulation (EU) 2017/459.

(17) The storage obligation will impose financial burdens on the relevant actors in those Member States, which have relevant storage facilities in their territory, while the increase in the level of security of supply will benefit all Member States including those Member States, which do not have storage facilities. To share the burden, in a spirit of solidarity, of ensuring that storage facilities in the Union are sufficiently filled to ensure security of supply, Member States without storage facilities should comply with the obligation to use storage in other Member States. In case there is no interconnection with other Member States, or limited cross-border transmission capacity or other technical reasons make it impossible to use storage facilities in other Member States, the obligation should be reduced accordingly.

(18) However, Member States should not be subject to such an obligation if they jointly develop an alternative burden sharing mechanism with one or more Member States with storage facilities. Such alternative mechanism can take into consideration, among others, already existing equivalent legal obligations to store alternative fuels. Member States should notify such alternative burden sharing mechanisms to the Commission.

(19) The measures by which Member States without storage facilities share the burden of the storage obligation with Member States with storage facilities may in turn have a financial impact on the relevant market actors. Member States without storage facilities may therefore provide financial incentives or compensation to market participants for the shortfall of revenues or for costs incurred by obligations imposed on them which cannot be covered by revenue. If the measure is financed through a levy, that levy shall not be allocated to cross-border interconnection points.

(20) Effective monitoring and reporting is essential, both for the assessment of the nature and extent of the risks related to security of supply, as well as for the choice of the appropriate measures to counter such risks. Operators of storage facilities should report the filling levels to the national competent authorities on a monthly basis during the filling period. Owners and operators of storage facilities are also encouraged to encode regularly the capacity and the filling level for each storage site at a central reporting platform.

(21) The regulatory authorities should play an important role in monitoring security of supply, one of the tasks attributed to the regulators by the Internal Energy Market legislation, and ensure a balance between security and the cost of the measures for consumers. The Commission will monitor the filling levels, jointly with the competent authorities of Member States.

(22) The role of the Gas Coordination Group should be reinforced, with an explicit mandate to monitor Member States' performance in the area of gas security of supply, and to develop best practices on that basis in that area. The Commission shall therefore regularly report to the Gas Coordination Group, which shall support the Commission in monitoring the filling targets, and in ensuring that the filling targets are met.

(23) The Union considers that the storage system sector is of high importance to the Union, its security of energy supplies and its other essential security interests. Accordingly, storage facilities are considered critical infrastructure within the meaning of Council Directive 2008/114/EC of 8 December 2008 on the identification and designation of European critical infrastructures and the assessment of the need to improve their protection. The Member States should take into account the measures under this Regulation in their national energy and climate plans and the progress reports adopted pursuant Regulation 2018/1999.

(24) The Union considers that additional safeguards are necessary in the storage system network to avoid any threats to public order and public security in the Union and to the welfare of the citizens of the Union. Member States should ensure that each storage system operator, including such operators controlled by transmission system operators, is certified under this Regulation by the regulatory authority or another competent authority designated by the Member State to ensure that the influence over storage system operators does not put at risk the security of energy supply or any other essential security interest in the Union or any Member State. For the analysis of possible security of supply risks in other Member States, coordination between Member States in the security of supply assessment, is important and should not discriminate between market participants and should fully comply with the principles of a well-functioning internal market. In order to quickly alleviate the danger of low storage levels, the certification should be prioritised and carried out faster for larger storages and storages which have recently been filled at consistently low levels, so as to ensure that potential security of supply problems resulting from the control over such large storages can be excluded.

(25) Regulatory authorities should refuse the certification if a person who directly or indirectly controls or exercises any right over the storage system operator may put at risk the security of energy supply or any other essential security interest Member State, regional or Union level. In this assessment the regulatory authorities should take into account commercial relationships that could negatively affect the incentives and ability of the storage operator to fill the storage facility, as well as the international obligations of the Union and any other specific facts and circumstances of the case. To ensure the consistent application of those rules across the Union, respect for the international obligations of the Union and solidarity and energy security within the Union, the regulatory authorities should take into utmost account the Commission’s opinion when they take decisions on certification. Where a regulatory authority refuses the certification, it should have the power to require any person to dispose of the shareholding or rights they have over the storage system operator and to set a time limit for such disposal, to order any other appropriate measure to ensure that that person or those persons cannot exercise any control or right over that storage system operator, and to decide on appropriate compensatory measures. Any measure taken in the certification decision to address security of supply risks or other essential security interests should be necessary, clearly defined, transparent, proportionate and non-discriminatory.

(26) If enterprises are due to purchase more gas when such gas is expensive, this could further drive up prices. Therefore this Regulation is accompanied by the removal of entry and exit tariffs for transmission capacity to and from storage, making storage more attractive for market participants. Regulatory and competition authorities should also use their competences to effectively exclude undue increases of storage tariffs.

(27) In view of the exceptional circumstances of the current situation and the uncertainties related to future geopolitical developments, Member States are encouraged to meet the filling targets as quickly as possible, and in any event no later than within the timeframes set out in this Regulation.

(28) Considering the imminent danger for the security of supply brought about by the current armed conflict, this Regulation should enter into force the day after its publication in the Official Journal. In order to ensure coherence with the Commission Proposal COM/2021/804 final for a Regulation of the European Parliament and of the Council on the internal markets for renewable and natural gases and for hydrogen (recast), this Regulation should only apply until a regulation on the internal markets for renewable and natural gases and for hydrogen, following the above mentioned Commission Proposal COM/2021/804 final, is adopted and enters into force, reflecting the amendments introduced by this Regulation.