Gas emergency plan launched: What does that mean for consumers now?

Created: 03/30/2022, 14:39

Private consumers do not need to worry about the gas emergency plan just yet.

© Fabian Sommer/dpa

Because of a possible delivery embargo for Russian gas, Economics Minister Robert Habeck has launched the gas emergency plan.

We explain what that means for you.

Munich - By proclaiming the early warning level of the gas emergency plan, the federal government is sending a clear signal - the situation is serious because of the Ukraine war.

Private consumers do not have to worry about their gas supply for the time being, unlike industry.

An overview:

What is the Gas Contingency Plan?

The gas emergency plan is based on a European regulation to ensure a secure gas supply from 2017. Three escalation levels give the government different degrees of scope for action.

The first level is the early warning level, followed by the alert level and the emergency level.

So far, the emergency plan has never been used in Germany - Italy and Latvia declared the early warning level at the end of February and beginning of March.

What does the declaration of the early warning level mean?

The early warning level means that the federal government, under the direction of the Ministry of Economic Affairs, is closely monitoring the situation on the gas market.

A crisis team made up of authorities, energy suppliers, transmission system operators and representatives of the federal states meets regularly and advises the government.

Gas suppliers and network operators provide the federal government with regular assessments of the situation.

However, the state is not yet actively intervening in the gas market - on the contrary, gas suppliers and network operators must procure more gas as part of so-called market-based measures, fill the storage facilities as best as possible and optimize gas flows.

What are the next steps?

Even at the alarm level, the state is not yet actively intervening in what is happening on the market.

However, the frequency of crisis talks will be increased, and the authorities may ask freight forwarders and gas customers to voluntarily supply more gas or use less gas.

If the federal government declares the emergency level, it can actively intervene in market activity: the Federal Network Agency then decides who will receive how much gas.

Private consumers, social institutions such as hospitals and gas-fired power plants, which also serve to supply private heat, enjoy special protection - they must be supplied with gas "as far as possible", explains the Ministry of Economic Affairs.

What is the current supply situation in Germany?

"The security of supply is still guaranteed," emphasized Economics Minister Robert Habeck (Greens) on Wednesday.

The declaration of the early warning level is a measure “to be prepared in the event of an escalation on the part of Russia”.

The gas storage facilities in Germany are currently 26.5 percent full and are recording a daily net inflow of 0.21 percent.

Is the supply of consumers secured?

Private customers also enjoy special protection in the emergency phase.

According to the Energy Industry Act, a private customer is anyone who uses energy for their own consumption in the household or whose annual consumption for professional, agricultural or commercial purposes does not exceed 10,000 kilowatt hours.

Gas suppliers must guarantee the natural gas supply to these customers for a period of at least 30 days and take appropriate precautionary measures.

However, further price increases cannot be ruled out.

To what extent are companies affected?

The Federal Network Agency makes the decision on prioritizing the gas supply of companies in the event of an emergency.

The aim of this prioritization is to secure the vital need for gas, taking into account the protected customers and minimizing the consequential damage - an exact order as to which companies or sectors will be cut off from the gas network first is not specified.

According to the Federal Network Agency, it is preparing for the emergency level.

In such a case, damage is "hardly avoidable", it is then "damage to limit".

The network agency explained that the desire to prepare a sequence is understandable for reasons of planning security for the companies.

Due to the complexity of the situation, however, "decisions are always made on a case-by-case basis".

However, according to its own information, the Federal Network Agency is developing criteria that can be used for an "overall assessment".

Gas consumption in German industry is high: According to the Federal Statistical Office, around 31 percent of the energy consumed is covered by natural gas. Gas also plays an important role as a preliminary product, particularly in the chemical industry.

Almost 37 percent of gas consumption in industry in 2020 was used for the manufacture of chemical products, food and animal feed production accounted for a further eleven percent of gas consumption.

The metal industry consumed 10.3 percent.

(AFP)