AGGM: German gas export fees breach EU law, raising Czech import costs

A special gas transmission charge levied by Germany at its borders is not in line with EU law, according to the head of Austria’s AGGM. The country introduced the charge to cover costs incurred from filling gas storage facilities in 2022. Since the start of the year, the charge has risen by more than a quarter, increasing the cost of gas imports into neighbouring countries, including Czechia.

During the peak of the energy crisis in 2022, a number of governments and public companies incurred additional expenses that they are now seeking to cover. One example is the cost of filling German gas storage facilities after Russia’s Gazprom lost its reserved capacity. To fill the facilities ahead of winter, the German market operator bought gas in the summer of 2022, when prices reached enormous levels.

Germany subsequently began levying a new charge on gas exports from the country, seeking to retrospectively recover the additional costs from 2022. According to Bernhard Painz, a board member of Austria’s AGGM, which manages part of the country’s gas market and distribution network, the charge breaches EU legislation. According to him, the high charge restricts cross-border trade and widens price differences between countries.

According to Painz, AGGM is surprised that the European Commission, which is aware of the details, has not intervened against the charge.

"In this situation, neither short-term trading nor long-term commitments for gas supplies from Germany can develop," Painz told Argus Media, adding that these charges are likely to rise further in the future.

German gas exports weakened last year

Last year, Germany saw not only a decline in electricity exports, but also in natural gas exports. The reason was a further year-on-year fall in supplies from Russia, as gas flowed to Germany via the Nord Stream pipeline for part of 2022. While Germany exported nearly 500 TWh of gas in 2022, according to Argus Media, exports amounted to only 187 TWh last year.

"Market participants’ response to the charge could mean that the total costs to be paid by users of the German gas system could be even higher than if the charge were not applied at cross-border points," Painz added.

Higher gas export charges have therefore likely also reduced the volume of gas flowing from Germany to Czechia in recent months. A decline in flows from Germany has been evident especially since the last quarter of last year, while gas is also flowing to Czechia via Slovakia.