Gas storage requirements discussed in Czech Republic

Shippers could have to keep a further 10% of natural gas in store in winter according to new requirements being discussed by the country’s energy regulator ERU and the Ministry of Industry and Trade, Jakub Necesany, head of the gas balance department at OTE, told ICIS. A final decision is expected by 1 July.

The Czech Republic is revising its energy act to bring it in line with the EU-wide third energy package that aims to create a single gas and electricity market. As part of the revision, the regulator and ministry are discussing whether to raise the required gas storage from 20% to 30% of the peak demand of socially sensitive customers from 30 September to 1 April of each year.

The revised public notice regarding energy security is expected to be published by 1 July.

The three options under discussion are

raise the requirements gradually by 2% each year over the next five years as proposed by the Ministry of Industry and Trade,

raise the threshold to 30% immediately as proposed by ERU,

or leave the threshold at 20%, an option favoured by traders and OTE, the Czech market operator.

ERU has initially proposed to raise the storage requirements to 40% but settled to discuss a 30% increase amid resistance from the ministry and suppliers, a source close to the matter said.

The regulator declined to comment on the issue or confirm the planned increases. “We assessed current legislature as insufficient and we are working on improving the legislature with regard to energy security and the protection of the Czech consumers,” said a spokesman.

The ministry refused to comment on the proposed increases as it has not made a formal proposal on the issue.

Storage capacity

Necesany argues that the Czech Republic is not yet up to speed with accommodating even the 20% storage requirements that were enforced two years ago.

RWE Gas Storage, a storage supplier in the Czech Republic disagrees. “We have enough storage capacity in the Czech Republic and neighbouring countries to fulfil even the 30% requirements,” a spokesman at RWE Gas Storage said.

Traders have the option to either store the gas in any EU country or prove they have bought it on the market. If traders buy or store the gas abroad, shippers are required to prove the origin of the gas and that enough firm Czech cross-border capacity has been booked to ship it into the Czech Republic.

ERU has initially demanded to have the percentage fixed into the new energy act to guarantee compliance. The ministry on the other hand opted to include the storage requirements in a revised public notice on security of supply that was first enacted in 2012. This would guarantee more long-term flexibility if amendments are necessary in the future. Marcello Kolax