EU to propose keeping mandatory gas-filling goals despite pushback from countries

BRUSSELS — The European Union will this week propose to keep mandatory targets for refilling winter gas storage facilities, according to two European Commission officials, overriding pleas by countries like Germany to make the goals more flexible.

The bloc first agreed to emergency rules on gas storage at the height of the 2022 energy crisis to allay fears of supply shortages following Russia's all-out invasion of Ukraine. Currently, that means EU countries must ensure their facilities are 90 percent full by November each year.

The measure was designed to ensure the bloc has enough gas each winter and to reduce the risk of price spikes. But several countries argue that it is now contributing to higher prices, and are pushing for more flexibility on the annual goal and related interim monthly targets.

The debate comes at a critical time. Last week, the EU unveiled its Clean Industrial Deal plan to save struggling heavy industries like steel, cement and paper, which face persistently high energy prices that they say hurts their ability to compete. The bloc's firms currently pay twice as much for energy as do their U.S. rivals.

According to Laura Page, an analyst at the Kpler commodities platform, the EU is exiting this winter with its gas supplies more depleted than in 2022 and 2023, following a cold snap and the loss of Russian pipeline gas via Ukraine last month.

This "puts more pressure on Europe to import a lot of [liquefied natural gas] this summer," Page said, which increases competition with Asia, "ultimately keeping prices high, which is difficult for industries." EU gas storages are currently 39.5 percent full.

Meanwhile, the pressure to meet storage targets is prompting countries to subsidize gas purchases. According to one gas industry insider, granted anonymity to speak candidly about sensitive financial information, 10 EU countries and the United Kingdom will pay a total of €30 billion to fill and store gas this year.

That worries EU capitals. At a meeting of member country envoys in Brussels earlier this month, Germany, Italy, Austria, Denmark, Spain, Greece, the Czech Republic, France and the Netherlands all raised concerns about the current rules, according to two EU diplomats, who like other officials quoted in this story were granted anonymity to speak freely. The countries pushed to make the goals either more flexible ahead of this winter or completely voluntary.

However, while this week's proposal from the Commission will be "reflective of the flexibility" that EU countries have requested and will give them more "breathing space" for meeting interim targets, according to one of the Commission officials, both the interim monthly goals and the final November target will remain obligatory.

In its Clean Industrial Deal, the EU executive also said it would consider "more flexible rules" on storage, without providing further details.

The new proposal on targets will "help to reduce system stress and avoid market distortions linked to gas storage refilling, supporting refilling at better purchasing conditions and security of supply," it wrote in the text.