FNB Gas on the NEST process

Statement by Barbara Fischer, FNB Gas Managing Director, on the Federal Network Agency’s NEST (Netze, Effizient, Sicher, Transformiert) process for the further development of the regulatory framework for gas grids:

“The NEST process for the further development of the regulatory system is to be welcomed in principle. However, the BNetzA is not achieving its goal of making the regulatory framework fit for the challenges of the transformation with its current considerations.

The current incentive regulation defines the path for the future based on values from the past. For the upcoming transformation phase on the path to climate neutrality, however, a continuation of this system with the basic assumption of a steady state and the sole focus on cost optimization would act as an obstacle. Efficiency is important and right, but cannot be ensured with the same instruments as in the past.

The transmission system operators do not yet see the current proposals of the Federal Network Agency as a further development suitable for transformation to enable flexible and resilient network development for the transformation. On the contrary, the transmission system operators perceive a tightening of regulation in many areas and are concerned that the special requirements of the transmission level with its responsibility for security of supply and integrated network development for gas and hydrogen have not yet been taken into account. This creates serious uncertainties for transmission system operators in particular.

Grid operators and their shareholders as well as their other investors need a reliable and sustainable regulatory framework in order to ensure the necessary investments in system security and transformation. The high availability and performance of the transport infrastructure represents a relevant locational advantage for Germany and must not be jeopardized.”