This July 20, 2022 photo shows the Nord Stream 1 Baltic Sea pipeline and the transfer station of the OPAL gas pipeline, the Baltic Sea Pipeline Link, lit by the evening sun in Lubmin, Germany. (MARKUS SCHREIBER / AP)
BRUSSELS/LONDON/MADRID – The European Union told member states on Wednesday to cut gas usage by 15 percent until March as an emergency step after President Vladimir Putin warned that Russian supplies sent via the biggest pipeline to Europe could be reduced further and might even stop.
Deliveries via Nord Stream 1, which accounts for more than a third of Russian gas exports to the EU, are due to resume on Thursday after a 10-day halt for annual maintenance.
German gas network operator Gascade said on Wednesday it expects flows to resume at pre-maintenance levels based on current requests for gas.
On July 10, the last full day before maintenance on the pipeline started, flows stood at around 698 GWh.
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Supplies via the route had been reduced even before the maintenance outage in a dispute over sanctions, and may now be cut further, while flows via other routes, such as Ukraine, have also fallen since the start of Russia’s especial military operation in Ukraine in February.
The move, which needs the backing of EU states, will be discussed on Friday so ministers can approve it on July 26
The disruptions have hampered Europe's efforts to refill gas storage before winter, raising the risk of rationing and another hit to fragile economic growth if Moscow further restricts flows in retaliation for Western sanctions over the Russia-Ukraine conflict. EU states are trying to ensure storage facilities are 80 percent full by Nov 1, from about 65 percent now.
The European Commission proposed a voluntary target for all EU states to cut gas use by 15 percent from August to March, compared with their average consumption in the same period in 2016-2021.
The Commission proposal would enable Brussels to make the target mandatory in a supply emergency, if the EU declared a substantial risk of severe gas shortages.
The move, which needs the backing of EU states, will be discussed on Friday so ministers can approve it on July 26.
Gas prices have rocketed in volatile trade since the Russia-Ukraine conflict erupted. The front-month gas contract climbed above 160 euros per megawatt hour (MWh) on Wednesday, 360 percent up on a year ago but below its March peak of 335 euros.
Spain rejects EU proposal
Spain’s Minister for Ecological Transition Teresa Ribera said on Wednesday that the Spanish government has rejected the EU plan to cut gas consumption.
"Whatever happens, Spanish families will not suffer gas or electricity cuts in their homes and the government will defend the position of Spanish industry, which has paid a special price to guarantee the security of supply," said the minister.
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Saying that consumption in Spain had been within reasonable limits, she added: "We want to help, but we also want to be respected.” "A disproportionate sacrifice cannot be imposed on us," especially when "we have not been asked for an opinion", she said.
As per the European Commission's proposal, Spain needs to reduce consumption of 55 terawatt hours out of an average of 367.28 TWh.