German economy and energy minister Katherina Reiche has said there is no need for state intervention as Germany's largest gas storage facility in Rehden is "not currently needed" for security of supply.
The legal storage fill levels of 80pc at most storage sites and 45pc at some slow-cycling sites are "still well reachable this year", Reiche said at a press conference in Berlin on 1 July. As such, it is "not necessary" for the state to fill storages through direct purchases by market area manager THE. While Germany has a lower fill level than in previous years because of a colder winter and the inverted summer-winter spread through the past winter weighing on incentives for injections, the "storage activity has now significantly picked up", Reiche said.
The 44.7TWh Rehden facility, which was filled to about 2pc of capacity on the morning of 1 July and has nearly no bookings for the ongoing storage year, is located in the north of Germany, Reiche said. There are other cavern storages near Rehden that are "quicker and easier to fill" than the slow-cycling depleted field and that are filled to "reasonable levels". While it is "uneconomic" to inject into Rehden at present, the low fill level is "no reason for concern" as there is sufficient LNG import capacity to ensure security of supply, meaning Germany can "fall back on a broad liquid offering" in the north of the country.
Lower gas alert level indicates less need for intervention
The now "early warning" level of the gas security of supply situation "means we currently do not have to enact, for example, significant market interventions through THE anymore", Reiche said.
The ministry, in co-ordination with regulator Bnetza, on 1 July lowered its assessment of the gas supply security level from "alert" to "early warning", after having been at the "alert" level since 2022. The definition of the early warning level is that there is "concrete, serious and reliable evidence that an event could occur that is likely to lead to a significant deterioration of the gas supply", Reiche said. But global events are still influencing gas supply so quickly that it seemed prudent to retain some powers to react quickly to potential adversities, she said. The early warning level also means "a permanent monitoring of the situation of gas storages" in order to react quickly and reactivate the "alert" level.
German energy and water association BDEW on 1 July said the lifting of the alert level "has little legal impact, as the specific regulations created in connection with the declaration of the alert level in 2022 already expired by spring 2024 at the latest". But the association said gas storage facilities are "an additional component in securing gas supplies" next to supply diversification and "sufficient quantities" should be in storage at the start of the heating season. German utility EWE underscored this sentiment today, saying it "must not happen" that storage facilities are not sufficiently filled before the coming winter. But there is "a real risk" of this if there is not sufficient commercial incentive to inject and the government "abdicates its responsibility", the utility said.
