While short-term gas supply disruptions have occurred in the past, there are several factors which distinguish the situation in 2022 from previous security of gas supply crises. The escalation of the Russian military aggression against Ukraine since February 2022 has led to unprecedented price increases. Those price increases are likely to fundamentally change the incentives to fill underground gas storage facilities in the Union. In the current geopolitical situation, further disruptions of gas supplies cannot be excluded. Such supply disruptions could severely harm citizens and the economy of the Union because the Union is still, to a significant extent, dependent on external gas supplies, which can be affected by the conflict.
(2)
The nature and consequences of recent events are large-scale and Union-wide and therefore require a comprehensive Union response. That response should prioritise measures that can reinforce the security of gas supply at Union level, in particular gas supplies to protected customers. Energy savings and energy efficiency are key contributors to that objective. It is therefore crucial that the Union acts in a coordinated manner to avoid potential risks resulting from possible gas supply disruptions, without prejudice to Member States’ right to choose between different energy sources and the general structure of their energy supply in accordance with Article 194 of the Treaty on the Functioning of the European Union (TFEU).
(3)
Underground gas storage facilities contribute to the security of gas supply and well-filled underground gas storage facilities lead to the security of gas supply by providing additional gas in the event of high demand or supply disruptions. Since supply disruptions of pipeline gas can occur at any time, measures regarding the filling level of Union underground gas storage facilities should be introduced to safeguard the security of gas supply for the winter of 2022–2023.
(4)
Regulation (EU) 2017/1938 of the European Parliament and of the Council (3) introduced a solidarity mechanism as an instrument to mitigate the effects of a severe emergency within the Union in which gas supply to solidarity protected customers, as an essential security need and a necessary priority is at stake in a Member State. In the event of a Union emergency, an immediate response ensures that Member States are able to provide enhanced protection to customers.
(5)
The impact of the Russian military aggression against Ukraine has shown that the existing security of supply rules are not adapted to sudden major changes in the geopolitical situation, in which supply shortages and price peaks can result not only from the failure of infrastructure or extreme weather conditions but also from intentional major events and from longer-lasting or sudden supply disruptions. It is therefore necessary to address the sudden greatly increased risks resulting from the current changes in the geopolitical situation, including by diversifying the Union’s energy supplies.
(6)
Based on the Commission’s analysis of, inter alia, the adequacy of measures to secure gas supply and the Union-wide reinforced risk preparedness analysis carried out in February 2022 by the Commission and the Gas Coordination Group (the ‘GCG’) established by Regulation (EU) 2017/1938, each Member State should, in principle, ensure that the underground gas storage facilities that are located on its territory and directly interconnected to a market area of that Member State are filled to at least 90 % of their capacity at Member State level by 1 November of each year (filling target), with a series of intermediate targets for each Member State in May, July, September and February (filling trajectory) of the year thereafter. Some Member States that have significant underground storage capacity would be disproportionately affected by the obligation to meet the filling target for the underground gas storage facilities on their territory. In order to reflect that situation, the obligation to fill their underground gas storage facilities should be reduced to 35 % of their average annual gas consumption over the preceding five years. This should be without prejudice to the obligation of other Member States to contribute to the filling of the underground gas storage facilities concerned. Member States should be able to decide, subject to conditions, to partially meet the filling target by counting liquefied natural gas (LNG) stocks stored in LNG facilities. The filling targets are necessary to ensure that consumers in the Union are adequately protected against gas supply shortages. For 2022, a lower filling target of 80 % and a reduced number of intermediate targets should apply, taking into account the fact that this Regulation is to enter into force after the start of the storage filling season and that Member States will have limited time to implement it.
(7)
When filling their storage facilities, Member States should aim to diversify their gas suppliers with a view to reducing their dependence where that may endanger the security of energy supply or the essential security interests of the Union or of the Member States.
(8)
Each year from 2023, gas storage should be specifically monitored from February to avoid the sudden withdrawal of gas from underground gas storage facilities in the middle of winter, which could cause security of supply challenges before the end of winter. The filling trajectories should enable continuous monitoring throughout the storage filling season.
(9)
Each year from 2023, each Member State with underground gas storage facilities should submit to the Commission a draft filling trajectory for such facilities on its territory and directly interconnected to its market area in an aggregated form. Taking into account the assessment of the GCG, the Commission should take a decision setting the filling trajectory for each Member State in a manner that does not unduly distort the competitive position of underground gas storage facilities in that Member State in comparison with such facilities located in neighbouring Member States.
(10)
In order to set the filling trajectory for each Member State with underground gas storage facilities from 2023 based on the draft filling trajectory submitted by each such Member State, implementing powers should be conferred on the Commission. Those powers should be exercised in accordance with Regulation (EU) No 182/2011 of the European Parliament and of the Council (4).
(11)
The filling trajectory for each Member State with underground gas storage facilities should comprise a series of intermediate targets and should be based on the average filling rate for that Member State during the preceding five years. For Member States for which the filling target is reduced to 35 % of their average annual gas consumption, the intermediate targets of the filling trajectory should be reduced accordingly.
(12)
Where a Member State cannot meet the filling target on time due to technical issues such as problems related to the pipelines feeding the underground gas storage facilities or with injection facilities, the Member State should be allowed to meet the filling target at a later stage. However, each filling target should be met as soon as technically possible, and in any event no later than 1 December of the year concerned, in order to safeguard the security of gas supply for the winter period.
(13)
It is possible that a Member State cannot meet the filling target or an intermediate target due to a regional or Union emergency, such as where the gas supply is insufficient as referred to in Article 11(1), point (c), of Regulation (EU) 2017/1938, which the Commission has declared at the request of one or more Member States, as the case may be, which have declared a national emergency within the meaning of that Regulation. Therefore, the filling targets, including the burden-sharing target, should not apply where, and for as long as, the Commission has declared a regional or Union emergency pursuant to Article 12 of that Regulation.
(14)
To ensure that there is no deviation from the filling trajectories, the competent authorities should continuously monitor the filling levels of the underground gas storage facilities. The filling trajectories should be subject to a margin of five percentage points. Where the filling level of a Member State is more than five percentage points below the level of its filling trajectory, the competent authority should immediately take effective measures to increase it. Member States should inform the Commission and the GCG of such measures.
(15)
Any substantial and sustained deviation by a Member State from its filling trajectory can jeopardise adequate filling levels and the filling target, which are necessary to safeguard the security of gas supply in the Union in a spirit of solidarity. In the event of such a substantial and sustained deviation from the filling trajectory or of a deviation from the filling target, the Commission should be empowered to take effective measures to avoid security of gas supply problems resulting from unfilled storage facilities. When deciding upon such effective measures, the Commission should take into account the specific situation of the Member State concerned, such as the size of the underground gas storage facilities in relation to domestic gas consumption, the importance of the underground gas storage facilities for security of gas supply in the region and any existing LNG storage facilities. As this Regulation is to enter into force after the start of the storage filling season in 2022, any measures taken by the Commission to address deviations from the filling trajectory for 2022 should take into account the limited time available for the implementation of this Regulation at national level. The Commission should ensure that the measures do not go beyond what is necessary to safeguard the security of gas supply, without putting a disproportionate burden on Member States, gas market participants, storage system operators or consumers.
(16)
Member States should take all necessary measures to ensure that the filling targets are met. In so doing, they should aim to use market-based measures as a first recourse, where possible, so as to avoid unnecessary market disruption. Member States should be free to set a higher filling target, so that the Union could strive to reach collectively the filling of 85 % of the capacity of the underground gas storage facilities in the Union for 2022. Given the various regulatory regimes already in place in many Member States to support the filling of storage facilities, no specific instrument to meet the filling trajectories or the filling target should be imposed. Member States should remain free to decide which instrument is most appropriate for their national systems, provided that certain conditions are met. Member States or competent regulatory authorities should therefore have the possibility to determine which market participants are to be required to ensure the filling of the underground gas storage facilities. They should also be able to decide whether regulatory means, such as measures to oblige capacity holders to free up unused capacity, which are possible under existing Union market rules are sufficient to ensure that the filling targets are met, or whether financial incentives or storage tariff rebates are necessary. If a Member State imposes an obligation on suppliers of gas to protected customers on its territory to store gas in underground gas storage facilities, the amount of gas to be stored should be determined on the basis of the amount of natural gas supplied to those protected customers. Member States should coordinate with each other and use instruments such as platforms for the purchase of LNG in order to maximise the utilisation of LNG to fill storage facilities. In addition, Member States should reduce infrastructure and regulatory barriers to the shared use of LNG to fill storage facilities.
(17)
The Commission communication of 8 March 2022 entitled ‘REPowerEU: Joint European Action for more affordable, secure and sustainable energy’ clarified that Union law allows Member States to provide aid to gas suppliers under Article 107(3), point (c) TFEU in order to ensure the filling of storage facilities, for example in the form of guarantees (two-way contract for difference).
(18)
Any measure taken by Member States to ensure the filling of underground gas storage facilities, including the conditions to be imposed on filling based on burden-sharing and the conditions to be imposed on withdrawal of gas from underground gas storage facilities, should be necessary, clearly defined, transparent, proportionate, non-discriminatory and verifiable, and should not unduly distort competition or the proper functioning of the internal market in gas or endanger the security of gas supply of other Member States or of the Union. In particular, such measures should not lead to the strengthening of a dominant position, or to windfall gains for undertakings that control underground gas storage facilities or that have booked but have not used, storage capacity.
(19)
The efficient use of the existing infrastructure, including cross-border transmission capacities, underground gas storage facilities and LNG facilities, is important to safeguard the security of gas supply in a spirit of solidarity. Open energy borders are key for the security of gas supply, including in times of gas supply disruptions at national, regional or Union level. Therefore, measures taken to ensure the filling of underground gas storage facilities should not block or restrict cross-border capacities allocated in accordance with Commission Regulation (EU) 2017/459 (5). In addition, Member States should ensure that storage remains available, including to neighbouring Member States and where an emergency as referred to in Article 11(1), point (c), of Regulation (EU) 2017/1938 is declared.
(20)
The storage obligation is likely to impose a financial burden on the relevant market participants in those Member States which have relevant underground gas storage facilities on their territory, while the increase in the level of security of gas supply is intended to benefit all Member States, including those that do not have underground gas storage facilities. To share the burden of ensuring that underground gas storage facilities in the Union are sufficiently filled to safeguard the security of gas supply, in a spirit of solidarity, Member States without underground gas storage facilities should use underground gas storage facilities in other Member States. In the event that a Member State has no interconnection with other Member States or if a Member State’s limited cross-border transmission capacity or other technical reasons make it impossible to use underground gas storage facilities in other Member States, that obligation should be reduced accordingly.
(21)
Member States without underground gas storage facilities should ensure that market participants within such Member States have in place arrangements in Member States that have such facilities that provide for the use, by 1 November, of storage volumes corresponding to at least 15 % of their average annual gas consumption over the preceding five years. However, Member States without underground gas storage facilities should also be able to develop an alternative burden-sharing mechanism with one or more Member States that have underground gas storage facilities. Also other existing equivalent measures to safeguard the security of gas supply should be taken into account when considering the burden-sharing mechanism, such as an equivalent obligation with regard to fuels other than natural gas, including oil, subject to certain conditions. Member States should notify such alternative burden-sharing mechanisms to the Commission and demonstrate the technical limitations, and the equivalence of the measures taken.
(22)
It is possible that the measures by which Member States without underground gas storage facilities share the burden of the storage obligation with Member States that have underground gas storage facilities have, in turn, a financial impact on the relevant market participants. Member States without underground gas storage facilities should therefore be allowed to provide financial incentives or compensation to market participants for the shortfall in revenues or for the costs of obligations imposed on them which cannot be covered by revenue. If such measures are financed through a levy, that levy should not be applied to cross-border interconnection points.
(23)
Effective monitoring and reporting is essential for the assessment of the nature and extent of the risks related to security of gas supply as well as for the choice of the appropriate measures to counter such risks. Operators of underground gas storage facilities should report filling levels to the competent authorities on a monthly basis during the storage filling season. Owners and operators of underground gas storage facilities are encouraged to enter the capacity and the filling level for each underground gas storage facility regularly on a central reporting platform.
(24)
The competent authorities play a significant role in monitoring the security of gas supply and ensure balance between the security of gas supply and the cost for consumers arising from the measures. The competent authority of each Member State or another entity designated by the Member State should monitor the filling levels of the underground gas storage facilities on their territory and report the results to the Commission. It should also be possible for the Commission, where appropriate, to invite the European Union Agency for the Cooperation of Energy Regulators (ACER) to assist with monitoring.
(25)
It is vital that the risk assessments carried out pursuant to Article 7 of Regulation (EU) 2017/1938 take into account all risks which could severely affect the security of gas supply. For that purpose, the risk-based approach to assessing the security of gas supply and the establishment of preventive and mitigating measures should also take into account scenarios in which there is a total disruption of a single supply source. To ensure maximum preparedness in order to avoid a disruption of gas supply and to mitigate the effects of such a disruption, the common risk assessment and the national risk assessments should be carried out by taking into account such scenarios. This would enable the coordination of measures to mitigate the effects of an emergency and the optimisation of resources to guarantee a continued supply, in the event of a total disruption of supply.
(26)
The role of the GCG should be reinforced, with an explicit mandate to monitor Member States’ performance and to develop best practices, with regard to the security of gas supply. The Commission should therefore regularly report to the GCG and the GCG should assist the Commission in monitoring the filling targets and in ensuring that they are met.
(27)
The GCG acts as a key adviser to the Commission to facilitate the coordination of security of supply measures, assisting the Commission at all times and, more specifically, in the event of a crisis. As necessary, in order to ensure maximum preparedness and to facilitate the quick exchange of information, the Commission will convene, without delay, the crisis management formation of the GCG, in anticipation of a possible crisis. The GCG crisis management formation should be available to assist the Commission for as long as necessary. To that end, the GCG should maintain channels of communication with Member States and all relevant market participants in the security of gas supply and collect information relevant to the security of gas supply at national, regional and Union level.
(28)
The storage system sector is of high importance to the Union, the security of its energy supplies and other essential security interests of the Union. Accordingly, underground gas storage facilities are considered to be critical infrastructure within the meaning of Council Directive 2008/114/EC (6). The Member States are encouraged to take into account the measures introduced by this Regulation in their national energy and climate plans and in the progress reports adopted pursuant to Regulation (EU) 2018/1999 of the European Parliament and of the Council (7).
(29)
Additional safeguards are necessary in the storage system network to avoid threats to public order and public security in the Union or to the welfare of Union citizens. Member States should ensure that each storage system operator, including storage system operators that are controlled by transmission system operators, is certified by the national regulatory authority or by another competent authority designated by the Member State, in order to ensure that the security of energy supply or any other essential security interest in the Union or any Member State is not endangered by the influence over the storage system operator. For the analysis of possible security of energy supply risks, coordination between Member States in carrying out the security of supply assessment is important. That assessment should not discriminate between market participants but should fully comply with the principles of a well-functioning internal market. In order to quickly alleviate the risk resulting from low filling levels, that certification should be prioritised and carried out faster for larger underground storage facilities which have recently been filled at consistently low levels, so as to ensure that potential security of gas supply problems resulting from control over such large storage facilities can be excluded or, if possible, rectified. Considering the average filling level of the preceding six years of all Union underground storage facilities on 31 March being 35 % of their maximum capacity, the threshold for the definition of an unusually low filling level in March 2021 and March 2022 should be set at 30 %.
(30)
National regulatory authorities or another competent authority designated by the Member States concerned (in either case, ‘certifying authority’) should refuse certification where they conclude that a person who directly or indirectly controls or exercises any right over the storage system operator could endanger the security of energy supply or any other essential security interest at national, regional or Union level. In making that assessment, the certifying authority should take into account commercial relationships that could negatively affect the incentives and ability of the storage system operator to fill the underground gas storage facility, as well as the international obligations of the Union and any other specific facts and circumstances of the case. To ensure the consistent application of certification rules across the Union, the observance of the international obligations of the Union and solidarity and energy security within the Union, the certifying authority should take the utmost account of the Commission’s opinion when it takes decisions on certification, including by revising its draft decision, where appropriate. Where a certifying authority refuses certification, it should have the power to require any person to dispose of the shareholding or rights they have over the storage system owner or storage system operator and to set a time limit for such disposal, to order any other appropriate measure to ensure that that person is not able to exercise any control or right over that storage system owner or storage system operator, and to decide on appropriate compensatory measures. Any measure taken in the certification decision to address security of gas supply risks or other essential security interests should be necessary, clearly defined, transparent, proportionate and non-discriminatory.
(31)
This Regulation respects fundamental rights and observes the principles recognised in particular by the Charter of Fundamental Rights of the European Union (the ‘Charter’). In particular, it respects the right not to be deprived of one’s possessions, except in the public interest and in the cases and under the conditions provided for by law, subject to fair compensation being paid in good time for their loss as provided for in Article 17 of the Charter and the right to an effective judicial remedy and to a fair trial as provided for in Article 47 of the Charter.
(32)
If undertakings are due to purchase more gas when the price of gas is high, this could further drive up prices. Therefore regulatory authorities should be able to apply a discount of up to 100 % to entry and exit tariffs for transmission and distribution capacity to and from storage, to both underground gas storage facilities and LNG facilities, making storage more attractive for market participants. National regulatory authorities and competition authorities are also encouraged to use their powers to effectively exclude undue increases of storage tariffs.
(33)
In view of the current exceptional circumstances and the uncertainties related to future changes in the geopolitical situation, Member States are encouraged to meet the filling targets as quickly as possible.
(34)
Considering the imminent danger for the security of gas supply brought about by the Russian military aggression against Ukraine, this Regulation should enter into force on the day after its publication. Due to the exceptional nature of the current circumstances, certain provisions introduced by this Regulation should apply only until 31 December 2025.
(35)
This Regulation should, as a matter of urgency, become part of the Energy Community acquis in accordance with the Energy Community Treaty, which was signed in Athens on 25 October 2005 and entered into force on 1 July 2006.
(36)
Regulation (EU) 2017/1938 and Regulation (EC) No 715/2009 of the European Parliament and of the Council (8) should therefore be amended accordingly,
