World's Energy

January 20, 2009 - AFX News Limited - Germany's energy regulator aims to achieve a further concentration of gas market zones into eight units by October 2009, further easing market conditions for traders, the authority's vice president said on Tuesday. "I assume that we will be down to eight zones from the start of the (winter) 2009 gas season," Johannes Kindler, the second in command at the Bundesnetzagentur in Bonn, told reporters during an energy conference in Berlin. The agency started reforming operational modalities and prices charged to users on the country's gas and power networks in 2005 to ease access and cut overall energy costs. Last October, it had forced the number of delivery zones down to 12 from over 700 four years ago, creating bigger geographic units and creating more transparency for users. But it started proceedings last August against five gas transport companies over their failure to combine five market areas for low-calorific (L) gas into two from Oct. 1, 2008. The companies are E.ON Gastransport, RWE Transportnetz Gas, Gasunie Deutschland Transport Services, EWE Netz GmbH, and Erdgas Muenster Transport. The operators said they found it too hard to deal with capacity bottlenecks and technical restrictions in time. Kindler said the agency would work with operators to resolve the issues blocking progress before the next winter season. Too many zones mean that traders cannot reliably put a cost on the transport charges they will levy on their customers, which means they cannot make competitive alternative offers. The concentration of bigger H-gas zones, a highly calorific type piped from Russia and the North Sea, is more advanced. The H-gas transport area of market leader E.ON's Ruhrgas for example has become a flourishing gas trading hub and since last October has encompassed a transport corridor allowing traders to book flows from the North Sea to the Alps. But a significant zone merger involving the H-gas zones of Gasversorgung Sueddeutschland (GVS), Italy's Eni's and French Gaz de France's is still on hold.