The players in the Danish gas market must prepare for the possibility of a real supply crisis. That is why the Danish Energy Agency is now stepping up its gas preparedness, it wrote in a press release on Monday evening.
This is happening because in recent times there has been increasing uncertainty about gas deliveries from Russia, after the country has reduced deliveries to Germany by 60 percent.
- It is a serious situation we are in, and it has been worsened by the reduced deliveries from Russia to the European gas market, says Deputy Director General of the Danish Energy Agency Martin Hansen in the release.
- We are closely following developments in the gas markets. We are still getting gas in Denmark, and we have plans ready to protect consumers. Fortunately, we are in a robust position in Denmark because we have a lot of green energy, it says.
The Danish Energy Agency has declared a so-called "Early Warning", which acts as a signal to the players in the gas market to prepare. This is the lowest of three different preparedness levels.
The gas storage facilities in Denmark are currently 75 percent full. They should be 80 percent full from November if they are to meet the common EU target.
Emergency plan ready
Should Denmark end up in a regular gas crisis, an emergency plan is ready so that Danes do not have to fear a cold home over the winter. This is according to Minister for Climate, Energy and Utilities Dan Jørgensen (S).
- We are prepared for an emergency situation to arise. We are not there yet, but we are prepared, he emphasizes.
The plan includes the possibility that the largest gas-consuming companies may end up having their gas supply completely or partially shut off for a period of time. The Danish Energy Agency has already been in dialogue with the business community about who may end up having to contribute in a possible crisis.
- Most of the companies that consume a lot of gas have plans ready to be able to replace gas, but we will now make renewed contact with the companies to hear whether the authorities can do anything to help them, says Deputy Director Martin Hansen.
Will Russia shut off the gas or will the EU say no
Both the Danish Energy Agency and the minister are urging Danes and Danish companies to save on gas where possible.
- We are in the process of filling our gas reserves and getting Denmark ready for any situation, says the minister.
Dan Jørgensen has no doubt that the issue of gas has also become part of the political game between the EU and Russia. Therefore, one must prepare for two scenarios, he says.
- One is that Russia completely shuts off the gas supply to Europe. The other is that we ourselves choose to say that we will no longer accept it.
In any case, Denmark should be prepared for a crisis, he says, mentioning that the Tyra field, which produces gas in the Danish part of the North Sea, will be reopened in mid-2023.
- And from there we will become self-sufficient, he says.
The EU has three crisis levels for gas supply
Russia has reduced its gas supplies to Germany, and this is affecting the entire market. The Danish Energy Agency is stepping up its gas preparedness and is issuing a so-called "early warning" on Monday evening due to increasing uncertainty about gas supplies from Russia. But what does it actually mean?
Here is an explanation:
- * Common EU rules on gas crises mean that there are three crisis levels: early warning, alert and emergency.
- Early warning is declared "when there is concrete, serious and reliable information that an event may occur that is likely to result in a significantly deteriorated gas supply situation", the Danish Energy Agency states. If the event occurs, it will likely lead to one of the next crisis levels being triggered. It is a signal to the players to prepare.
- Alert is a "significantly deteriorated gas supply situation" that the market is still able to handle.
- Emergency is declared when supply is insufficient to meet demand and "non-market-based measures" must be introduced. This could, for example, mean a halt to the supply of gas to certain companies that consume a lot.
- There are around 50 major Danish companies on the list of non-protected companies if the country is hit by a supply shortage. Arla and Danish Crown, among others, are on the list. They are not guaranteed gas supplies during a supply crisis. However, several have applied to use oil instead.
Source: Danish Energy Agency and Energinet.
Ritzau
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