EU deal reached on mandatory gas reserves for supply crises

Negotiators from the European Parliament and the 27 European Union member states have agreed on new regulations for mandatory gas reserve levels in the EU.

Gas reserves must be filled to 80 percent by November 1, rising to 90 percent from 2023 onwards until the regulation expires on December 31, 2025, the European Council, the EU body representing member states, announced in a statement on Thursday.

The European Commission proposed the rules in March, amid supply concerns over the war in Ukraine and Russian threats to cut gas supply, confirmed after Moscow cut deliveries to Poland and Bulgaria.

The commission and EU member states are to review reserve levels throughout the year with fees waived on transmission costs to incentivise suppliers to store gas despite high prices.

Negotiators also agreed on licences for operators to regulate their energy security obligations.

Should this be endangered through under-filling reserves, the licence may be withdrawn and the company compelled to forfeit control or ownership of storage facilities.

EU member states can also meet the storage obligations with stocks of liquefied natural gas (LNG).

Exemptions

Cyprus, Malta and Ireland secured exemptions from the regulations as long as they are not connected directly to the gas storage systems of other states.

EU member states with no storage facilities may access reserves in other member states and share the costs.

Allowances are to be made for EU countries with large storage facilities that they do not use completely themselves.

The European Parliament and the EU members now must adopt the regulations before their entry into force, but this is considered a formality.