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Issue title:

Gas industry & Corona crisis

Publication date:
08.04.2020
In this issue:

Economic and social life is, of course, dominated by the corona crisis. So naturally, the impact on the gas industry is topic of the month. I was surprised about how much 'business as usual' occurred in March. This will be one aspect of the story. But I do not want to be misunderstood. The gas industry will suffer from the dramatic economic crisis that is the consequence of the shutdown of life taking place in Germany, too. And it will be felt on all stages of the value chain. Nevertheless, a lot of business was still done in March. This can be seen in the figures, but it is also what market participants are reporting. However, towards the end of the month, activities became weaker. It was also quite remarkable to hear how the Vier Gas Participations' acquisition of a share in Route4Gas could be finished by organising virtual solicitor meetings for the necessary signings in several countries. But the Vier Gas acquisition of the Route4Gas share is still interesting. Find out more about it in this edition.

The corona crisis is already having a significant impact on market region conversion from L-gas to h-gas. In the topic of the month, I report about the developments and the background. The report is the result of many informal discussions and the gathering of information. But it is also work in progress because the situation is "dynamic", as a network operator described it in an email to me. Presumably, the process will be at least partly delayed. But until this edition went to press, the assessments were constantly changing.

The corona crisis is having an impact on many of the topics in this edition. The BNetzA Ruling Chamber (BK) 9 wanted to discuss the REGENT 2021 ruling at least in a web conference with stakeholders. It had to be postponed for organisational reasons. The Gas-Union shareholders formally launched the sales process for the company. It remains to be seen whether it makes sense under the current conditions to talk about a company takeover. And all business prospects that I write about in this edition may be influenced deeply by the current crisis.

Nevertheless, the energy industry is privileged; the business can and must continue. I hope, dear readers, that I can support you in looking forward.

TOPIC OF THE MONTH Gas industry & Corona crisis

So far, the gas industry - with one exception, more about that below - seems to be remarkably "unaffected" by the corona crisis. Sure, staff members of companies, agencies, ministries and associations that can work from home are in their home offices. And infrastructure operators took special precaution measures to guarantee security of supply. OGE (see also chapter 3), the biggest German TSO, already published on February 28 an excerpt from its intranet with behavioural rules for its staff as a press release on its website. The restrictions on travelling and contacts imposed at the time look harmless now, taking into account that public life in Germany is almost shut down in the meantime. But it demonstrates the risk awareness at a time when it was still being discussed what measures were needed and made sense. But all TSOs took similar measures. Distribution network operators started in mid-March to stop all activities during which contact with customers could occur - mainly metering activities. Allegedly, the main association of the energy industry recommended this step.

Work from home with the necessary communication devices for telephone and video conferences also has some positive side effects: "We are now learning very fast how to use all these devices. It works much better than a boring training", someone from a German utility told ener|gate Gasmarkt. Independent of the current mayhem, his employer is planning to reduce office presences and to rely more on virtual communication.

Framework conditionsGas Coalition

In the January edition, this publication reported in the market rumour section about the draft of a paper from the informal so-called "Gas Coalition". The Gas Coalition sought for the small paper a co-operation with associations that represent energy-intensive industries. The idea: The gas industry and the energy-intensive industry should present themselves jointly as a discussion partner for policymakers. They want to propose and discuss energy and climate policies that simultaneously secure the German industrial basis. The coalition has now been established: 17 companies from the gas industry plus the association of the chemical industry (VCI) and the association of large industrial energy users (VIK) signed the final version the paper. The companies and association want to be a dialogue partner of policymakers in the area of energy, in particular for energy efficiency in the industry, industrial CHP plants, and de-carbonised hydrogen. Wintershall, one of the signing companies, published the latest and agreed version.