ACER confident gas hub liquidity assessments will be conducted

EU policymaker recommendations that smaller natural gas hubs merge if they cannot meet liquidity targets are not mandatory, according to the Agency for the Cooperation of Energy Regulators (ACER). But there will be enough pressure on regulators from national stakeholders to ensure the required structural reform takes place, said Walter Boltz, chair of the ACER gas working group on Friday.

Energy watchdogs from across Europe, working under the ACER umbrella, have revamped the EU’s gas target model, which aims to create a common plan for a harmonised European wholesale market. In the updated model, ACER recommends that if a member state cannot achieve the requirements for market participants to access a “well-functioning” wholesale market before 2017, some form of market merger is needed.

Conducting an assessment of whether a country can meet liquidity targets and then putting in place hub mergers if the targets cannot be met is voluntary, but the updated model has the support of all national regulatory authorities, according to Boltz who was speaking at the presentation of the updated gas target model in Brussels on Friday. This will ensure the recommendations will be met.

He said ACER was also confident stakeholders will place pressure on regulators to make sure the requirements to ensure liquidity targets are met, including hub mergers.

Integration projects under consideration include western Austria and Germany; Austria, the Czech Republic and Slovakia; Spain and Portugal; Belgium and Luxembourg; and Poland, Czech Republic, Slovakia and Hungary.

Illiquid hubs need to have a minimum of eight daily deals per product and per hub to be executed. These hubs also need to have a minimum time horizon of 22-24 months within which trading in gas products should be possible.

The minimum threshold of gas offered or bid simultaneously is 120MW.

The first version of the model was published in 2011, but regulators have readjusted the criteria initially proposed as EU gas hubs have developed at different speeds since then. Miriam Siers