FNB Gas statement on the draft law amending the Energy Security Act 1975 and other laws (EnSiG amendment)

The amendment of the Energy Security Act is absolutely necessary against the background of the current crisis situation in the energy sector.

Transmission system operators (TSOs) welcome the introduction of the digital platform for natural gas to better manage gas reduction at companies. The platform is a central and exclusive instrument of the Federal Network Agency (BNetzA) to manage gas supply according to economic and other political criteria in the event of a gas shortage. Against this backdrop, the amount of the compensation payable pursuant to Sec. 15 para. 2 EnSiG, limited to up to 25,000 euros or up to 10,000 euros, should be reconsidered. It seems questionable, given the current market situation and the economic impact of reductions in gas volumes for energy-intensive industries under discussion, whether this sum is a motive for large companies to comply with the authority’s instructions and acts as a deterrent.

The TSOs consider the unclear demarcation or interplay between the TSOs’ grid stabilization measures pursuant to Section 16 (1) to be a key shortcoming of the draft law. 2 EnWG and the measures taken by the federal load dispatcher under the EnSiG to reduce gas purchases. The TSOs point out that the regulations pursuant to Section 16 para. 2 EnWG were not introduced to cope with a prolonged gas shortage situation, but were given to the transmission system operators exclusively to maintain system and network stability.

In the event of such a gas shortage situation having a supraregional or even nationwide impact, situations are not unlikely in which the TSOs have already taken network stabilization measures pursuant to Section 16 para. 2 EnWG must apply, but the BNetzA does not yet necessarily act as a federal load dispatcher. At this point, the TSOs are responsible and, in the event of a supraregional gas shortage, can only make non-discriminatory cuts on a “pro-rata” basis. The TSOs believe it is urgently necessary to anchor the legally secure, swift transfer of responsibility to the Federal Network Agency as the federal load distributor, and thus also of liability, in the current draft legislation. Early instruction by the TSO to reduce gas purchases from connected end users by the BNetzA can ensure a consistent transition to the federal load dispatcher and help close a liability gap for TSOs until the federal load dispatcher is in place.

Also, the provisions set forth in § 16 para. 2 EnWG for a storage instruction are still not sufficiently specifically regulated against the background of the new Gas Storage Act. Here, within the framework of the legislation, it is essential to consider the interaction with the Act on the Introduction of Level Requirements for Gas Storage Facilities and the minimum storage levels and processes for the release of storage quantities by Trading Hub Europe GmbH (THE) provided for therein, on the one hand, and the authority of the transmission system operators to issue instructions to storage operators or storage customers pursuant to Section 16 para.2 EnWG, on the other hand, should be clarified.

In addition to the additional statutory tasks for the market area manager (THE) already provided for in the recently adopted Storage Act, the proposed legislation on the EnSiG (pursuant to section 2a (2) and section 2b (1) EnSiG-E) provides for further new tasks. The FNB considers this task performance by THE to be sensible and purposeful. With the imposition of these new statutory tasks, however, it must be equally ensured by law that THE, as a privately organized company (GmbH), is remunerated at market rates for the tasks to be assumed and that the costs of setting up and operating the platform, as well as its own expenses for procuring the quantities pursuant to Section 2 EnSiG, can be apportioned. However, there is no statutory provision to this effect, so that appropriate and required adequate remuneration is not ensured.

The TSOs welcome the fact that, in future, decommissioning of gas storage facilities will have to be notified and approved by the Federal Network Agency (BNetzA) (Section 35h EnWG). However, it remains unclear whether the regulation also covers conversions of gas storage facilities from L-gas to H-gas. Against the backdrop of the new storage law, the TSOs see a risk that, due to the legally defined minimum filling level, L-gas storage operators may decide early on to switch to H-gas due to higher yield expectations for H-gas storage. To secure the supply of L-gas, there must be no distortions here. Therefore, a conversion of storage facilities from L- to H-gas should also have to be approved by the BNetzA.

In addition, the regulation so far only applies to gas storage facilities connected to the transmission system, but the handling of storage facilities in the DSO network should also be addressed, as these can also contribute to relieving the load on the TSO network. For gas storage facilities connected to the DSO network, a notification requirement would appear to make sense.

Further notes:

Regarding § 3 para. 6 No. 3 EnSiG-E:

The new provision in § 3 para. 6 No. 3 EnSiG-E lacks a responsibility provision for anyone who determines that fulfillment of the obligations cannot be achieved by market-based measures, cannot be achieved in a timely manner, or can only be achieved by disproportionate means.

Regarding § 14 para. 1 No. 2 and No. 3 EnSiG-E:

§ 14 para. 1 No. 2 EnSiG-E is, in the opinion of the FNB, too broad, as the large number of media – without, for example, concrete naming of the exact references – means that there is an obligation to review that goes beyond the normal scope for the companies that may be affected. It would be advisable here to limit the announcement channels in such a way that a review is still possible in the course of normal business operations.

The possibility of dispensing with a written confirmation of an orally communicated administrative act pursuant to Art. § 14 para. 1 No. 3 EnSiG-E appears critical in order to maintain legal certainty. It is questionable whether this option will be used at all, since the authority bears the risk of having to prove the content of the orally communicated administrative act.