Bavaria’s state government has urged German Chancellor Angela Merkel to create a national gas reserve, Frankfurter Allgemeine Zeitung said. It will be able to provide German consumers with natural gas for 135 days in case Ukraine starts siphoning off gas from transit pipelines. Ilse Aigner, Deputy Minister-President of Bavaria and Bavarian Minister of Economic Affairs expressed concern over the security of gas supply, saying that current conflict in Ukraine shows that supplies’ security is not a matter of course. According to her, the government of Germany must guarantee that dependence on Russia’s natural gas will not increase in future.
Currently, Germany’s gas reserves are estimated at 20 billion cubic meters. This will be enough to ensure a constant supply of gas to German consumers for 90 days.
The reason for concern is said to be the breakdown of tripartite gas negotiations between Russia, Ukraine, and the EU. So there is a possibility that Ukraine starts siphoning off the gas transited to Europe.
Aigner believes Germany needs to increase its gas reserve by at least 10 billion cubic meters. Gazprom supplies gas to Germany at $346 for 1,000 cubic meters. Thus, additional costs for creating the reserve could come in at almost $3.5 billion.
However, according to experts, the main problem is that most gas storage companies in Germany are owned by foreigners who might not agree to increase costs for the purchase of additional volumes. Thus, German media reported that the government could allocate the money, but this will trigger German households’ prices growth by 15-40 euros a year.