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Italy should focus on flexible gas storage rules: Efet

08 Aug 2017 15:51 (+01:00 GMT)
Italy should focus on flexible gas storage rules: Efet

London, 8 August (Argus) — European energy traders association Efet called on the Italian economic development ministry to prioritise more flexible storage rules over capacity expansions.

The association called on the ministry to start a review of the Italian storage service aimed at removing restrictions to storage use that hamper the flexibility of this source of supply, it said.

The most efficient way to guarantee security of supply is to allow the market to determine the most efficient way to provide it, Efet said. In the case of Italian storage, this could be done by making storage capacity more flexible and commercially attractive, it said.

Storage use in Italy is heavily constrained by strict injection and withdrawal profiles "artificially" restricting how market participants can use their capacity, Efet said.

This has reduced the value of storage capacity, which has become a source of seasonal gas supply and demand that changes monthly rather than providing short-term flexibility and trading opportunities, market participants said.

The economic development ministry has long insisted on maintaining a trade-off between commercial attractiveness and security of supply, although energy regulator Aeegsi has not ruled out the possibility of reconsidering the balance.

The injection profiles are also necessary to safeguard storage facilities, particularly those in depleted fields, and ensure stocks are sufficient for the winter, which is needed to guarantee peak withdrawal capacity during the winter, system operator Snam said.

Italy's draft new energy strategy, which is under consultation until the end of August, included the expansion of storage capacity aimed at increasing security of supply.

Security of supply margins have tightened in recent years, mainly as a result of a lower technical withdrawal capacity available at some storage sites, the ministry said.