Gas Storage – No gas in this storage

Russia’s war against Ukraine is escalating and increasingly becoming an energy war. Russia’s most powerful weapon: its gas. After state-owned Gazprom turned off the gas supply to Bulgaria and Greece earlier this month, Finland is now fearing the same because the country wants to join NATO for fear of a Russian invasion. But Russia is also exerting pressure on the gas pipeline in other EU countries.

Gazprom has its own gas storage facilities in Germany, the Netherlands and also in Austria. The gas storage power plant in Haidach near Straßwalchen near the German border is now becoming a political issue. Two-thirds of the storage capacity in Haidach was to be filled by Gazprom Storage Austria (GSA), based in Moscow, a Gazprom subsidiary. However, this is not the case at the moment (see graphic). That’s why Chancellor Karl Nehammer (ÖVP) recently said in the “Kleine Zeitung” in the direction of Gazprom: “Use it or lose it.”

The memory must either be filled, or other solutions will be sought. “Either the current storage operators or rights holders will fill it, or we will find other ways,” added Vice Chancellor Werner Kogler (Greens).

Tyrol depends on Germany

But actually the gas storage facility in Haidach does not fall under the responsibility of Austrian federal politics. It is connected to the German gas network, so it mainly supplies Germany, and in the past it was used by Gazprom as a kind of backup to secure the supply contracts for its European customers, Markus Krug from the domestic regulator E-Control explains to the “Wiener Zeitung”.

Haidach is by far the largest gas storage facility on Austrian soil and the second largest in Europe. “33 terawatt hours of gas can be stored there. That corresponds to a third of Austria’s total annual consumption,” explains Krug. This storage capacity is marketed by two companies. A third is filled with “astora”. It in turn belongs to Gazprom Germania, which has been under the trusteeship of the German Federal Network Agency for several weeks. Two thirds of the storage capacity belong to the GSA, so it “rents” its storage capacity there.

“Currently, everyone is filling at maximum storage speed,” explains Krug. The rule of thumb used to be: Calculated over the year, around a third of the annual consumption should be stored as a reserve in order to get through the winter well. In the previous year, however, the gas storage facilities were significantly less full. On the one hand, because the gas was unusually expensive after the lockdowns in summer and energy suppliers did not want to stockpile it at such high prices. On the other hand, Gazprom also throttled deliveries a bit, which in turn drove up gas prices.

Now Gazprom is not filling its storage facilities either. This is presumably due to geopolitical calculations. This in turn could become a problem for Germany, and indirectly for Austria. Because Haidach is not connected to the Austrian gas network, but neither are large parts of Tyrol and Vorarlberg. A large proportion of these federal states are supplied with gas via Germany.

Regulation on the filling quantity

In view of the tense situation on the energy market and skyrocketing prices, the EU has issued what is known as the Gas Supply Security Ordinance. Firstly, this prescribes an EU-wide memory utilization of 80 percent; and secondly, a stockpiling of 35 percent of the annual gas requirement in the individual member states.

The fact that the government is now making threatening gestures towards Gazprom with regard to the gas storage facility in Haidach has to do with the fact that Haidach is part of Germany but is on Austrian soil. And Germany has little or no right of access here. But if this storage remains empty, it could also become a problem for western Austria.

“The use-or-lose principle is not uncommon in regulated infrastructure,” explains Krug. In this specific case, it should ensure that the urgently needed storage infrastructure, which is necessary for security of supply, is actually used. “Otherwise, it should be left to another market participant, who then fills the storage.”

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