La Russian-Ukrainian crisis of late winter-early spring 2014 once again brought to the fore the question of security of gas supplies. Having said that the risk of having to ration supplies to Italian consumers did not arise because the crisis broke out towards the end of a very mild winter and gas stocks were still at a good level, the crisis that has occurred still requires some reflection.
Undoubtedly the appropriate level at which the topic must be placed is the community level: the security of energy supplies can in fact be adequately addressed only if the often opportunistic logic of individual states is replaced by an approach that sees Europe create "critical mass" in order to dissolve a game with extremely relevant and complex economic and geopolitical values into an organic and overall vision. Precisely for this reason, and while waiting for the conditions necessary for this "qualitative leap" to mature - hopefully in the short term - it may be useful to think about some rules and methods that allow our country to start in the right direction.
In this sense, it may be useful to start from the rules that the European Union has so far given itself to guarantee the continuity of gas supply. As is known, Regulation no. 994/2010 of the EU focuses on two tools: infrastructure capacity and supply rules. As far as infrastructure is concerned, the Regulation requires that the "N-3" rule be respected by 2014 December 1, i.e. it must be able to satisfy the total demand for gas "during a day of particularly high demand" even if cut off the flow of gas from major infrastructure. A corollary to this provision is the obligation for the transmission network operators to make bidirectional flow possible on internal cross-border networks by 3 December 2013 (so as to also facilitate mutual assistance). As far as supply is concerned, gas companies are obliged to guarantee supply to protected customers also in the following three cases: a) for a period of seven days in case of extreme cold; b) for at least thirty days of very high demand; c) for a period of thirty days in the event of interruption of the main infrastructure. There are at least two issues raised by these provisions.
Firstly, according to the Regulation, the security of supply concerns only i "protected customers" which are "domestic users connected to a distribution network" to which the Member States can add small and medium-sized enterprises and entities that provide essential services (for no more than 20% of total consumption). In Italy “vulnerable customers” have been defined as protected, i.e all civilian customers including those who perform public service and/or assistance activities and non-residential customers with consumption of less than 50.000 cubic meters per year. The consumption of these customers does not exceed half of Italy's total consumption, therefore only a part of the consumption is "protected". But what is most worrying is that in Italy a substantial share of gas (about 1/3) is used by the electricity sector where gas-fired combined cycles are the masters and the possible choice between "staying in the cold or staying in the dark" it's not even imaginable.
Secondly, the priority for ensuring security of supplies seems to be given to the presence of infrastructure because it is assumed that the lack of gas can only be temporary. This preference is consistent with the setting of the Commission who strongly believes in the virtues of the market to lower prices and solve the supply problem. There is no other way to explain the aversion and criticism of long-term contracts seen as restrictive of competition. The problem is that the infrastructure is not enough to fill the pipes or gas regasifiers in the event of a crisis. An account is a fault in a pipeline that can be repaired in a limited period of time, an account is an interruption due to an indefinite crisis. Under today's conditions and in the near future it is quite illusory to think that the Spot LNG could permanently replace a possible lack of supplies of a large pipeline, for example such as the one that crosses the Ukraine and arrives in Slovakia. And even having a partially empty pipeline doesn't guarantee that whoever is on the other side of the pipe can and will fill it quickly.
In summary, it is a question of not forgetting the good old principles which suggested that to increase the security of supply one must diversify sources energy and the areas of supply. At this point the problem arises: who decides on diversification? Hardly the market because the market aims for the least expensive solution with a short-term perspective and certainly does not provide insurance if the policyholders are not willing to pay for it (a hypothesis that is all the more realistic the more security is a public good that pushes everyone to an attitude of free riders). There is therefore room for careful reflection to see if the public intervention imagined so far is sufficient.
Consider the case of Italy. The infrastructure situation seems not only reassuring (the import capacity is much higher than our consumption and if we add storage capacity and internal production to the import capacity we are able to easily cover peak demand), but also balanced. The two main supply routes are the same (from Russia via Tarvisio and from Algeria via Mazzara del Vallo); the other two pipelines (from Libya and Northern Europe) have an overall capacity approximately equivalent to those from Russia and Algeria. To all this must be added the three regasification terminals which further increase diversification. However, if we look at the trend of imports, the situation changes because there was a sharp change in 2013. For a long time, imports from Russia and Algeria were balanced and equal to about 1/3 of the total, but in 2013 imports from Algeria halved compared to 2010 and that from Russia grew by almost 1/3. This was due to the renegotiation of the existing ToP (take-or-pay) contracts, badly viewed by both Brussels and Rome.
It was so possible for Eni (but also for Enel ed Edison) strongly reduce imports from Algeria, probably also facilitated by that country's difficulties in maintaining the level of exports (the total export of Algerian gas has been declining for some years). On the other hand, however, the simultaneous renegotiation of contracts with Gazprom was probably facilitated by the withdrawal of greater quantities as requested by the Russians and this greater withdrawal made it possible to reduce. In any case, Eni has had an interest in increasing its own imports from Gazprom to reabsorb at least in part the minimum contractual quantities not collected in the previous four years (the previous debt fell from €2.367 million as at 31 December 2012 to €1.892 million as at 31 December 2013).
So it was there commercial logic, much desired to reduce prices, to ensure that in 2013, half of the gas imported into Italy came from Russia. E in the first two months of 2014 the trend continued to grow (57/% of gas imports in January and February came from Tarvisio). Is all this reasonable? From the point of view of the security of supplies it would not appear. From a general political point of view even less so. What capacity of resistance could we offer in the event of a lasting political crisis in relations with Russia? So maybe it's time to think not just emergency plans for situations limited in time, but also to measures that can respond to any unfortunate lasting political crises. put a ceiling on the quota of maximum imports from a country would have a probably limited "insurance cost" and instead of weakening it would also help importers both in the renegotiation of existing take-or-pay contracts and in defining their own future import decisions. For this reason it is suggested that the Government, by notifying the Parliament, better specify the limits for gas import authorizations already envisaged by Legislative Decree 164/2000.
Attachments: Imports-Gas-DEF (3).pdf
