The EU is considering placing gas reserves in storage in Ukraine as gas inventories across the bloc reach 814 terawatt-hours (TWh) or 72% of the bloc’s gas storage capacity.
In salt caverns 2,000 meters underground, Ukrainian gas storage facilities can hold more than 30 billion cubic meters of gas. State-owned Naftogaz Group’s Ukrtransgaz is ready to provide a third of this capacity, equivalent to more than 100TWh -- around 10 percent of EU demand.
By comparison, in the week of June 4-10, Germany’s industry used 998GWh while households and businesses used 312GWh of gas -- a total of 1,310GWh or 1.31TWh.
“Ukrainian storage facilities can help balance supply and demand in the second half of summer 2023 given their good connection to EU gas markets,” German-based sustainable energy company RWE AG said in a statement.
The EU can store around 1,040TWh of gas, according to data compiled by Gas Infrastructure Europe (GIE). With EU storage sites expected to reach capacity limits as soon as early September, storing gas in Ukraine could also prevent a price glut in the coming months.
According to Reuters, prices for gas for July 2023 -- the height of the refill season -- fell to €48 per megawatt-hour on March 31 from €80 last December 30 and €177 in September.
“The Ukrainian market offers storage at a fixed cost rate, which makes gas storage in Ukraine a very attractive and competitive option,” Marco Saalfrank, the head of continental Europe merchant trading at Switzerland-based renewable energy firm Axpo, told Bloomberg.