Germany committed to 'ambitious' EU-level gas demand reduction targets: Giegold

Germany is committed to maintaining "ambitious" gas consumption reduction targets at the EU level in order to help fill storage facilities ahead of next winter and to avoid price spikes, a senior government official said late Feb. 27.

Sven Giegold, state secretary at the German economy ministry, said there was no room for complacency in ensuring European gas supply security.

"We must not be lulled into a false sense of security -- we must continue to work with all determination," Giegold said in a statement following a meeting of EU energy ministers in Stockholm.

"We must continue to pay attention to our energy consumption, and continue and increase our savings efforts," Giegold said. "At the European level, the German government is therefore committed to ambitious gas reduction targets."

EU member states in July last year agreed to reduce their gas demand between August 2022 and March 2023 by 15% compared with their average consumption from the previous five years through measures of their own choosing.

EU gas consumption in the period August 2022 to January 2023 was 19.3% lower than average for the same period from 2017-22, ahead of the EU's 15% savings target which expires at the end of March.

EU energy commissioner Kadri Simson said Feb. 27 following the ministerial meeting that continuing the voluntary gas demand reduction targets was a "no-regret" option to help member states to be well prepared for next winter.

Price spikes

Germany, though, has already gone further than most other countries in the EU, targeting continued gas savings of at least 20%.

Giegold said continued efforts to cut gas consumption would enable member states to fill gas storage sites over the summer and avoid price shocks.

"In this way, we guarantee that our storage tanks will be sufficiently filled again next winter and that prices will not go through the roof again," he said.

European gas prices hit record levels last summer as EU member states scrambled to meet storage targets against the backdrop of sharply lower Russian gas imports.

Platts, part of S&P Global Commodity Insights, assessed the benchmark Dutch TTF month-ahead price at an all-time high of Eur319.98/MWh on Aug. 26.

Prices have weakened since on the back of healthy storage and demand curtailments, with Platts assessing the TTF month-ahead price on Feb. 27 at Eur47/MWh.

The EU in June last year imposed a storage filling target of 80% by Nov. 1, 2022 -- with a collective aim to better the target and reach 85% -- as part of emergency measures to rebuild stocks ahead of the winter.

This year, EU countries are required to fill their storage facilities to 90% of capacity by Nov. 1.

Simson said Feb. 27 that the EU expected to end the heating season with over 50% of its storage filled, despite lower Russian imports.

According to data from Gas Infrastructure Europe, the EU's gas storage facilities are currently filled to 62% of capacity.