EFET: Higher gas transit charges fragment the European market and raise import costs for eastern countries

The European Federation of Energy Traders has opposed increases in charges for cross-border gas transmission in Europe. Some European countries have raised charges for transporting gas through their territory to cover the costs of filling storage facilities in 2022. According to the association, such measures are not in line with the principle of solidarity and make gas imports from the west to eastern parts of Europe more expensive.

Rising transmission charges have become a major issue across the European gas market in recent weeks. The sharpest increase has been in Germany, which wants to use the charges to cover costs incurred when filling gas storage facilities in 2022. Italy and Austria are also considering similar measures.

Austrian company AGGM, which manages part of the country’s gas market and distribution system, has also opposed higher cross-border charges. According to a member of its executive board, they are contrary to EU legislation. EFET says countries should not pass these costs on to consumers in neighbouring countries through higher transmission charges. The association has therefore condemned both the existing charges in Germany and proposed charges in other countries.

Germany raised its transmission tariffs for this reason last October, and the charge has increased further this year. Earlier this week, according to Argus, a consultation launched by the Italian regulator over similar plans in Italy also concluded. In response, the Austrian regulator proposed raising charges for gas imports from Germany and Italy.

Such charges could significantly widen price differences between individual countries in Europe. According to the association, they could also reduce cross-border transmission volumes and capacity bookings, further undermining the revenues of transmission system operators.

More expensive imports from the west benefit Russian supplies

More expensive cross-border transmission could also hinder the EU’s efforts to further reduce imports of Russian gas. Charges in Germany and other countries increase the cost of importing gas from the west for Central and Eastern European countries. The association points out that EU rules prohibit charges of this kind to cover the costs of meeting gas storage targets, although those rules apply only to regulated facilities. The association says the European Commission should clarify the rules to make clear that more of the costs should be borne in the individual countries.