Filenews 25 April 2023
As of today, European companies can participate for the first time in joint gas purchases through the European Union's Energy Platform and the Aggregate EU mechanism, as it has been called, according to the European Commission, which announced the launch of the mechanism.
The mechanism is part of efforts underway to prepare the European Union for next winter and replenish gas reserves as part of the EU's dependence on Russian fossil fuels. The logic of this approach lies in harnessing the collective power of the EU market to negotiate better gas prices with international suppliers.
Asked about this, an EU source said that the Commission will not announce which companies are participating as this is something that concerns the companies themselves.
As an EU official explained, Cyprus is one of the countries that is not obliged to participate in the joint procurement process as it is an island and has secured a relevant exemption.
In particular, the online platform launched by the Commission enables companies registered in the system to declare their gas needs, with the system then gathering the needs and identifying corresponding offers from international suppliers.
However, negotiations between companies and suppliers will take place outside the system, without the involvement of the Commission.
According to the timetable, registered companies have until May 2 to participate in the first call for interest. Requests for supply quantities will then be pooled and entered the global gas market. After May 17, the first contract negotiations are reportedly expected to begin, in order to reach the first agreements before the summer.
The Commission has proposed two different models of cooperation at company level, through a central buyer or through a representative.
The central buyer model envisages that a company, possibly a large gas company, will have agreed to buy gas on behalf of other companies under a bilateral contract, a model that can be used by companies whose needs do not reach the sizes needed to participate in the system or do not have the necessary credit rating or experience in negotiation.
The agent model refers to the provision of additional services to companies that have already negotiated directly with a supplier for the purchase of a certain amount of gas. Such services could for example be booking a delivery place at an LNG terminal, or transporting gas from a ship to the point of consumption.
The tenders will be launched every two months for the next 12 months, while the system remains open for any company wishing to register with it. So far, 67 companies from across the EU and the European Energy Community (which also includes Ukraine, Moldova, Georgia and the Western Balkan countries) have registered, while a further 11 companies have declared their readiness to participate by providing services as central buyers or representatives. In terms of interest from outside the EU, Ukraine, Moldova and Serbia have expressed interest so far.
Member states have committed, as part of the transition away from Russian fossil fuels, to participate in the mechanism for at least 15% of national gas storage targets, equivalent to about 13.5 billion cubic meters (bcm) of gas per year.
The platform is not open to companies from Russia or companies of Russian ownership or interests.
The AggregateEU online online platform, through which demand will be aggregated towards common markets, is managed by the private company Prisma.
