Impacts of EU gas storage regulations examined in new ACER-CEER consultancy study

Today, ACER and the Council of European Energy Regulators (CEER) publish the second part of a two-fold consultancy study on the impact of the EU and national gas storage regulations.

What is the role of gas storage?

Gas storage is vital for supplying 25-30% of the EU’s winter gas demand and plays a key role in the security of gas supply. The increasing importance of well-filled gas storage facilities was highlighted by the recent energy crisis, helping to mitigate potential gas supply disruptions and strengthen Europe’s resilience.

The EU gas storage Regulation (2022) introduces storage filling targets and burden sharing mechanisms. From 2023, it requires underground storage facilities to be filled to 90% before starting the winter period.

What is the study about?

The aim of the study was to analyse the measures adopted by Member States to strengthen the use of underground storage facilities in the EU and their contribution to the objectives of the EU gas storage regulation.

ACER and CEER commissioned VIS Economic & Energy Consultants to conduct a two-part study on this topic. The first part (published in October 2023) focused on collecting and assessing storage measures recently applied by EU Member States. This second part assesses storage arrangements in Member States without gas storage facilities, identifies lessons learnt and makes recommendations for better use and implementation of storage measures

• Support schemes for storage: They have motivated market participants to use storage, especially when contracting capacity is linked with filling targets. Support mechanisms should complement storage users’ obligations.
• Storage filling of last resort: The efficiency of this measure could be enhanced by facilitating access to futures markets for price hedging and with implementing a strategy for releasing gas stocks back to market.
• Cross-border impacts and cost recovery:  The release of gas stocks should not oblige entities to reserve excess capacity at cross-border interconnection points (IPs). Cost recovery mechanisms should not include charges and levies imposed at IPs.
• Use-it-or-lose-it mechanism of storage capacity: A congestion management mechanism including a streamlined process for capacity release at specific milestones is useful for efficient use of storage capacity.
• Contracts for differences (CfDs): They should be defined and offered well in advance of the injection period. Direct subsidies should be provided as a last resort only if the interest in CfDs is limited.

Want to know more?

On 12 March 2024, ACER and CEER are hosting a webinar to:

• present the consultancy study’s finding on the impact of the EU and national gas storage regulations;
• offer insights into the ongoing implementation of the EU gas storage regulation;
• discuss the important role of storage with stakeholders through polls & Q&A session.

Register to the ACER-CEER webinar (12 March).