Commercial developments in European underground gas storage

I read with interest Issue No. 89 of the Oxford Energy Forum about ‘Natural Gas Demand and Supply’ published in August. The articles are topical and contain very useful information about inter alia European markets, price indexations, producers’ market power and the global impact of shale gas. However, I believe, that none of the authors addresses the importance of underground gas storage for European gas supplies sufficiently. Gas storage is the key to balancing this continuous gas import and seasonal/ fluctuating demand of the markets and – more and more importantly – to realising the daily/weekly price spreads within the regional market and beyond. Europe is facing a rising need for storage capacities as the gas demand will be growing and supplies come from increasingly remote locations. In addition, there are technical as well as economic and political risks in the transit countries, which are a concern for Western and Central Europe in winter times on a regular basis, underlining the essence of security of supply for the European economy. Energy storage (gas, air, hydrogen) can also manage excess electricity supplies and thus help accommodate to renewable energies, which act as a game changer because they are extremely fluctuating and their share is growing.