Germany on Wednesday triggered the first of three stages of its emergency gas plan.
Effectively warning of potential disruptions of energy imports from Russia, its biggest supplier.
Here is a closer look at the three stages, which are all communicated by Germany's Economy Ministry:
1. EARLY WARNING PHASE
- This stage is triggered when there are "concrete, serious and reliable indications that an event may occur.
Which is likely to lead to a significant deterioration of the gas supply situation and probably to the alarm or emergency level."
- Gas companies continue to ensure supplies, there are no supply disruptions yet.
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- Gas transmission system operators (TSOs), or network operators, update Germany's Economy Ministry at least once a day on the supply situation.
- Electricity TSOs coordinate to ensure the stability of their grids.
- Gas suppliers advise the government and are part of the crisis team.
- The government immediately informs the European Commission about potential further measures.
Which can include revoking the early emergency status if the conditions are no longer met.
2. ALARM PHASE
- This stage is triggered when there "is a disruption in the gas supply or an exceptionally high demand for gas.
This leads to a significant deterioration of the gas supply situation.
But the market is still able to cope with this disruption or demand without the need to take non-market based measures."
- It kicks in when there is a high risk of long-term supply shortages of gas.
- There are no changes compared with the first phase, but all market players, including TSOs and gas suppliers.
Are under more pressure to balance out disruptions via efficiency and short-term measures such as procuring gas from alternative sources.
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3. EMERGENCY PHASE
- This stage is triggered when there "is an exceptionally high demand for gas, a significant disruption in gas supplies or another significant supply situation.
And all relevant market-based measures have been implemented, but gas supply is insufficient to meet the remaining gas demand so that additional.
Non-market based measures need to be taken, in particular, to ensure the supply of gas to protected customers."
- State intervention kicks in because market fundamentals no longer apply, effectively meaning that remaining gas supplies are rationed.
- This is done by the German network regulator, the Bundesnetzagentur, which is tasked with securing.
The "vital demand for gas with special consideration of protected customers and minimizing consequential damage."
- In broad-brush terms, supply to the industry is curtailed first, while households and critical institutions such as hospitals continue to receive available gas. - INVESTING
