Germany to Use Market Incentives to Boost Winter Gas Storage
Germany plans market incentives, a larger autumn tender and fuller use of Uniper and SEFE storage to shore up winter gas supplies.
Germany's Economy Minister, Katherina Reiche, intends to rely on market incentives rather than direct state purchases to encourage traders to hold more gas for the coming winter, a government source said.
Under the plan, an autumn tender for Long Term Options (LTOs) will be expanded by a volume of gas that has not yet been fixed. LTOs are instruments that allow Trading Hub Europe, the country's nationwide gas market coordinator, to lock in deliveries from traders for possible future use.
As part of the same effort, the government has reached an agreement with the state-owned energy companies Uniper and SEFE under which the two firms will make fuller use of their storage capacity.
A decision on the matter is expected by September 21, according to Politico.
The measures follow mounting concern about supply. Germany's gas storage sites were roughly 53% full in early September, the lowest level recorded for that time of year since data collection began 15 years ago, according to the storage association INES.
INES warned last week that an exceptionally cold winter could result in supply shortfalls as early as January.