1. Role of Storage Facilities GTE 2nd Annual Conference, 23./24.09.2004 – Copenhagen © VNG 2004 Barbknecht Speaker: Klaus-Dieter Barbknecht Director Gas Transport and Storage VNG – Verbundnetz Gas AG

2. Role of Storage Facilities GTE 2nd Annual Conference, 23./24.09.2004 – Copenhagen © VNG 2004 Barbknecht Download To get this presentation as pdf-file please send an e-mail to vortrag@vng.de with „ GTE storage“ in the subject field and without any further text. vortrag@vng.de To: vortrag@vng.de GTE storage subject: GTE storage The presentation will be sent directly to your e-mail address.

3. Role of Storage Facilities GTE 2nd Annual Conference, 23./24.09.2004 – Copenhagen © VNG 2004 Barbknecht  Role of storage facilities  Flexibility market  GTE Storage Study Group  Access rules to storage in European countries  Development of GGPSSO  Further steps: GTE Action list  Final Conclusion Agenda

4. Role of Storage Facilities GTE 2nd Annual Conference, 23./24.09.2004 – Copenhagen © VNG 2004 Barbknecht Role of natural gas storage facilities Balancing seasonal variations in consumption Securing gas supply in case of interferences in production, transport or supply Covering demand peaks Enhancing cost effectiveness of gas transport

5. Role of Storage Facilities GTE 2nd Annual Conference, 23./24.09.2004 – Copenhagen © VNG 2004 Barbknecht Flexibility market I  Storage is not the only relevant market. There are other tools offering flexibility to network users, traders and consumers.  Flexibility services are for instance:  Interruptible Contracts  Contractual swing  Production swing  Short term contracts  Linepack etc.

6. Role of Storage Facilities GTE 2nd Annual Conference, 23./24.09.2004 – Copenhagen © VNG 2004 Barbknecht Flexibility market II All these products including storage facilities constitute the flexibility market, which is characterised by a functioning competition. In principle, a regulatory approach would thus be superfluous and inappropriate.

7. Role of Storage Facilities GTE 2nd Annual Conference, 23./24.09.2004 – Copenhagen © VNG 2004 Barbknecht GTE Storage Study Group (SSG)  Working group of storage operators and owners  Members are most SSOs (e.g. Gasunie, Transgaz, BEB, Fluxys, Wingas, Total, OMV, GdF, Transco, Ruhrgas, Gasum Oy, RWE, Snam Rete gas, VNG) including independent SSOs as for example Essent, RAG and Nafta.  The aim is to facilitate the process of further developing the EU-internal market for natural gas with respect to TPA to gas storage facilities.  Current task:  Cooperation in establishing of GGPSSO in the Madrid process by discussing the important issues with CEER, users, ERGEG and the EU-Commission

8. Role of Storage Facilities GTE 2nd Annual Conference, 23./24.09.2004 – Copenhagen © VNG 2004 Barbknecht Access rules to storage in European countries CountryTariffsConditionsCombined Operator AustriaNegotiated Yes BelgiumRegulated Yes DenmarkNegotiated No FranceNegotiatedUnder discussionYes/No GermanyNegotiated Yes ItalyRegulated No NetherlandsNegotiated No PortugalUnder discussion Yes SpainRegulated Yes UKNegotiatedRegulatedNo SlovakiaNegotiated No Czech Rep.Under discussion Yes/No

9. Role of Storage Facilities GTE 2nd Annual Conference, 23./24.09.2004 – Copenhagen © VNG 2004 Barbknecht Development of Guidelines for Good TPA Practice for Storage System Operators (GGPSSO) I  Outcome of the Madrid Forum VIII from 8 th – 9 th July 2004:  Expressed demand for minimum requirements of non- discriminatory and transparent access to storage facilities.  Key elements should include range of services, capacity allocation and congestion management mechanisms, transparency and confidentiality requirements, tariff structures and tariff derivations.  Application and implementation of the GGPSSO at the latest at the beginning of the next storage year (1 st April 2005).

10. Role of Storage Facilities GTE 2nd Annual Conference, 23./24.09.2004 – Copenhagen © VNG 2004 Barbknecht Development of Guidelines for Good TPA Practice for Storage System Operators (GGPSSO) II  Revised CEER/ERGEG Draft of GGPSSO from 6 th September 2004:  Main GTE comments were not taken into account.  New ERGEG consultation procedure imposes time constraint on GTE. Proposition of GTE to have further consultations between CEER/ERGEG, GTE and other parties involved e.g. by organising a second storage workshop in October 2004

11. Role of Storage Facilities GTE 2nd Annual Conference, 23./24.09.2004 – Copenhagen © VNG 2004 Barbknecht Development of GGPSSO III  Main points from GTE proposal :  Priority to market based solutions.  Preference for negotiated access where market conditions permit.  GTE supports common set of minimum requirements ensuring transparency and non-discriminatory access.  ERGEG deadline for implementation (April 2005) is not realistic.  Specific deadlines for the implementation of each service along market needs and in consideration of technical and economical constraints.

12. Role of Storage Facilities GTE 2nd Annual Conference, 23./24.09.2004 – Copenhagen © VNG 2004 Barbknecht Further steps: GTE Action List  Proposition of a concrete timetable with specific deadlines for the implementation of GGPSSO (GTE Implementation plan)  Comments on ERGEG revised GGPSSO  Comments on the Commission and ERGEG positions to common criteria for nTPA and rTPA  Optimisation of lobbying organisation regarding storage

13. Role of Storage Facilities GTE 2nd Annual Conference, 23./24.09.2004 – Copenhagen © VNG 2004 Barbknecht Final Conclusion The aim of the Commission and ERGEG to reach an agreement on GGPSSO at the Madrid Forum IX 3 rd December 2004 and thus the success of Madrid IX is strongly dependent on the progress in the cooperation between GTE, ERGEG, users, CEER and the Commission.