Stay informed with free updates
Simply sign up to the EU energy myFT Digest — delivered directly to your inbox.
Austria, the Czech Republic, Hungary and Slovakia have warned they could be forced to increase Russian gas imports because of a German levy on supplies piped across its borders, highlighting strains in the EU’s bid to diversify sources of energy.
The four EU countries still receive significant volumes of piped gas from Russia despite the full-scale invasion of Ukraine two years ago, which has led Europe to attempt to wean itself off its dependence on energy from its eastern neighbour.
As Russia slashed pipeline supplies to Europe in retaliation for EU sanctions, European gas prices soared to record levels of more than €300 per megawatt hour in August 2022. Germany imposed the transit tariff in 2022 to cover the cost of refilling its gas storage tanks to hit European Commission targets intended to avoid winter shortages for businesses and consumers.
But central and eastern EU member states argue the additional costs have damaged their efforts to buy gas from western neighbours. In a paper circulated among EU countries and seen by the Financial Times, Vienna, Prague, Budapest and Bratislava said the tariff made it “more difficult for member states in this area to access gas imports from western Europe”.
“This could force some member states to rely more heavily on gas imports from Russia, potentially increasing their geopolitical dependencies and undermining all efforts to diversify energy sources,” they added.
The levy currently stands at €1.86/MWh, around a tenth of the current benchmark European gas price.
EU officials have said they are assessing the tariff amid concerns that it will prompt others to implement their own charges. Italy is contemplating introducing a similar measure as early as this year.
Jozef Síkela, the Czech energy minister, told the FT that EU countries should not “allow any devaluation of our efforts [to cut dependence on Russian fuels] by introducing fees that benefit the import of Russian gas”.
The complaint comes at a time when the EU is looking to cut all imports of Russian gas. Before Moscow’s invasion of Ukraine, Russian-piped gas previously made up 40 per cent of the bloc’s supply, a share that has since fallen to 8 per cent, according to the European Commission.
Leonore Gewessler, Austria’s energy minister, last week said her country was looking at options for an early end to its gas supply contract with Russia, which runs until 2040.
Brussels is also due to propose an extension of targets for cutting gas demand as a way to keep reducing the bloc’s reliance on fuel imports before a meeting of the bloc’s energy ministers on March 4, according to EU officials.
Germany has become a major buyer of liquefied natural gas and now acts as an import gateway for other European countries. LNG from countries such as the US and Qatar is seen as key to reducing the bloc’s dependence on Russian gas.
However, shipborne supplies of Russian LNG into the EU have also increased.
Aura Sabadus, energy market expert at energy consultancy ICIS, said the German levy was “a significant barrier” for eastern member states. It also “provides a good excuse to say they did their best to diversify [from Russian gas] but the levy blocked them from doing so”, she added.
The commission said it was aware of “the concerns expressed by various parties” about the German levy, citing “the protection of the internal market and the avoidance of market fragmentation”.
Germany’s economics and climate protection ministry did not respond to a request for comment.
Additional reporting by Sam Jones in Berlin
