Borderless transport

The new market area GASPOOL was launched at the beginning of October. But what does it mean for the gas market? What will change for customers and traders? GASWINNER has the answers.

The market areas of five German network operators have been put together like a puzzle. Now they form one unit, a joint balancing zone for H-gas. The new market area and the company responsible for the job of balancing group management are collectively called GASPOOL. “The name GASPOOL reflects our objectives perfectly. It symbolizes our goal to build one of the leading gas trading places in Germany right in the heart of Europe,” GASPOOL Managing Director Ludger Hümbs, says.

The market areas of five trans-regional natural gas transport companies ONTRAS – VNG Gastransport and WINGAS TRANSPORT as well as three other companies, StatoilHydro Deutschland, Gasunie Deutschland and DONG Energy Pipelines, merged to form the joint market area H-gas Northern Germany.

“The merging of the market areas is a key building block in promoting more competition,” says Matthias Kurth, President of the Federal Network Agency, explaining that it allows gas to be transported through Germany more easily without constantly having to make arrangements with different network operators. Around 300 downstream networks lie in the transport and trading zone created by the partners. They connect the import points to the end consumers and pave the way for an open and competitive natural gas market in Germany.

“As far as the gas transport in and out of the GASPOOL market area is concerned, the system works very much like the EU’s Schengen Agreement,” Hümbs explains. “In order to get into the EU, citizens must show their ID cards at the border, after that they can move freely from country to country and do not have to show their ID again until they leave.”

GASPOOL works according to the same principle: in order to feed the natural gas into the pipeline network of the market area, the transport customer closes one entry contract with one network operator in the GASPOOL market area.

The natural gas can then be delivered to any exit point in the market area, provided the transport customer has closed an exit contract with a downstream network operator.



The magazine GASWINNER informs about the new market area GASPOOL.

Link to supply countries

“GASPOOL simplifies the transport and trading of natural gas in Germany,” Hümbs says. All the customers in the market area are connected to the most important natural gas suppliers, Norway and Russia, via the international network interconnection points. And 60 percent of the German storage capacities are located in the GASPOOL market area, including the largest natural gas storage facility in Western Europe, in Rehden in Germany. As many as 4.2 billion cubic meters of natural gas can be stored in the WINGAS storage facility.

GASPOOL also links up six EU countries: Poland, the Czech Republic, Denmark, the Netherlands and Belgium are all connected to the German market area thanks to their international network interconnection points. This means transport customers now have one single balancing zone between these countries.

“The two-contract model also applies here – transport customers can transport gas from Ellund in Denmark through the market area to the Czech Republic, for example, with just one entry and one exit contract,” Hümbs explains. Traders in the market area do have to be aware, however, that no additional transport capacities were created with GASPOOL.

The bottlenecks are simply transferred to the new outside borders of the market area. Trading at the GASPOOL hub, a virtual trading point for buying and selling natural gas, will also have to take into account transport-related restrictions.

Foothold for more competition

Every trader can transport the natural gas from the import points to the end customer via the pipelines in the market area. Companies wishing to supply household or industrial customers in the GASPOOL market area with natural gas in future merely have to feed this gas into one of the networks or purchase it in the market area, or alternatively at the GASPOOL hub. The network operators then make sure the gas gets to the end consumers. The transfers between market areas that were previously necessary for network operators that covered more than one market area are no longer required in the GASPOOL market area. This will attract new traders and further boost competition on the gas market.

The traders also see the benefits of the market area cooperation. “Processing customer deliveries will become much simpler,” Matthias Peter, Head of Natural Gas Sales II at WINGAS, explains. “Now we can also reach potential customers to whom we had no access previously.”

When the entry/exit system was introduced there were 28 market areas in Germany. This division into small parts was partly due to the various qualities of gas – in Germany there are H and L gas networks. But the main reason for this was that the German pipeline networks were owned by many different companies.

Since some of these are in competition with each other, initially they each formed their own market area. New legislation then required them to cooperate and this led to the gradual merging of the market areas. Now there are only six market areas in Germany, three for H-gas and three for L-gas.

Important trading point

“About half of the H-gas transported in Germany flows through the GASPOOL market area. Such volumes allow for smooth and flexible trading at the GASPOOL hub,” Hümbs explains. The operator of the new market area and the trading point is GASPOOL Balancing Services GmbH, which is based in Berlin. The company will take care of the balancing and control energy management of the market area. Market participants can also trade control energy directly with GASPOOL. These gas volumes and storage products are necessary in order to ensure the reliable operation of the networks in the market area and the natural gas supply for end consumers at all times. There are various gas products, the orders for which are fulfilled at the GASPOOL hub or at clearly defined physical points.

“We want to become an important gas trading point in Europe and continue to promote competition. To this end we have eliminated the borders,” Hümbs says, adding that the project had got off to a good start and was also open to other companies.

»Public utilities can trade gas flexibly and fast at GASPOOL «

GASPOOL Managing Director Ludger Hümbs speaks about the launch of the new market area and natural gas trading with public utilities. more