Germany has four months to decide on Nord Stream 2 certification
Germany 's energy regulator Bundesnetzagentur has four months to decide whether to certify the Nord Stream 2 operating company as an independent transmission system operator (TSO) – a ruling that will affect how much of the pipeline's capacity Gazprom can use.
Nord Stream 2 AG, a subsidiary of Gazprom, said in June it had applied for independent TSO status. In a post on its website on September 13, Bundesnetzagentur said it had received all necessary documents for the certification process, which began on September 8. It has four months to take a decision, which will then be submitted to the European Commission for review.
Nord Stream 2 also needs technical certification to begin the commercial flow of gas.
Bundesnetzagentur has to ensure that Nord Stream 2, which reached completion on September 10, complies with EU rules that require pipeline owners and the gas suppliers using them to be separate. But Nord Stream 2 enjoys the support of the German government, given the economic benefits Germany stands to gain.
"If Nord Stream 2 is considered an independent operator by the EC, it would be allowed to use the pipeline at 100% capacity," VTB Capital (VTBC) said in a research note on September 15. "Otherwise, according to the Third Energy Package, the utilisation rate would be limited to 50%, or 27.5bn m3 of nameplate capacity, depriving the company of the potential benefits of reduced transportation costs after 2024, when the existing ship-or-pay contract with Ukraine expires."
VTBC told NGW in June that Gazprom stood to save $1.3bn on annual transportation expenses once Nord Stream 2 is working at full capacity. The Moscow-based brokerage estimates that this will add 3-4% to Gazprom's core earnings (Ebitda).