German TSOs to start work on planned natural gas grid expansions
Germany's natural gas transmission system operators (TSOs) must immediately start the planning procedure for the grid expansion projects described in Germany's 2012 gas grid development plan, the regulator, Federal Network Agency (BNetzA), said on Tuesday.
At the same time, BNetzA ordered the TSOs to make a number of changes to the plan, which is now generally approved. Once these are concluded, Germany's first obligatory gas grid development plan will take immediate effect.
After receiving a total of 48 comments from market participants on the current version of the plan, BNetzA has asked the TSOs to include a more detailed and clearer overview of planned projects. This aspect of the grid development plan has caused misunderstandings between BNetzA and the TSOs once before, when during a regulator workshop held in Bonn, the two parties discovered disagreements regarding the envisaged completion dates. As it turned out, a number of projects listed in the draft were expected by the regulator to be finished by 2015, while the TSOs were aiming for completion in 2017 (see ESGM 28 June 2012).
BNetzA has now also demanded more details on the planned temperature-based transport product for new storage facilities, which has been causing widespread criticism (see ESGM 10 October 2012). According to market participants, the suggested product - which switches from firm to interruptible depending on the temperature - stands in contrast to the storage market's needs for short-term flexibilities.
In total, the grid development plan contains 47 projects, 32 of which will have to be finalised within the coming 10 years, while 15 of the projects are planned to be finished within the coming three years. The total investment is €3.2bn.
Most of the projects are aimed at connecting gas-fired power plants and storage facilities to the grid or at tackling the north-south bottleneck within the German gas grid, according to the regulator. The existing bottleneck became evident earlier this year, when a combination of reduced supply and high demand saw NCG Day-ahead prices shoot to €38.25/MWh on 7 February 2012 (see ESGM 7 February 2012) - the highest level ever recorded by ICIS. The spike was mainly caused by Russia's Gazprom not being able to meet rising incumbent nominations, which rallied as temperatures plunged, but in Germany, the tightness was additionally enhanced by grid issues.
BNetzA has also appointed certain TSOs to be responsible for those projects, for which the involved companies were unable to come to an amicable solution. WINGAS-subsidiary GASCADE will have to build the planned compressor station at Drohne - estimated at €55m - in order to connect the grid point with Rehden. Together with Open Grid Europe (OGE), GASCADE will also be in charge of expanding the existing infrastructure at Reckrod for €220m in order to improve the connection between the German market areas NCG and GASPOOL. Meanwhile, OGE will be in charge of building the planned Arresting-Finsing loop pipeline, estimated at €156m. JR
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