French Govt Tables Proposal to Accelerate LNG Import Facilities

France’s National Assembly has approved measures to ensure security of gas supply which focus on the power sector, LNG and underground storage.

LNG

The Port of Le Havre in France, where the proposed FSRU terminal will be set up. Credit: By Philippe Alès, CC BY-SA 4.0, Wikimedia Commons

France’s National Assembly has approved measures to ensure security of gas supply which focus on the power sector, LNG and underground storage. The legislation, which will now need to be approved by the senate, will allow the government to order gas-fired plant operators to reduce or halt production in the event of a threat to security of gas supply at a local, national or European level.

If electricity supply were threatened, the state could order gas-fired plant operators to function only under the orders and control of a designated operator. Co-generation plants would be lower down in the merit order for these measures.

The French parliament also approved measures to create a regime to accelerate the rollout of LNG import facilities and the floating storage and regasification unit (FSRU) at Le Havre, but specified that the operating life of the FSRU “may not exceed five years”. This legislation would be in force until 1 January 2025, and the operator of the new FSRU would be obliged to publish a study on the direct and indirect greenhouse gas emissions produced by the facility within six months of its commercial start.

The National Assembly has also approved measures to ensure the country’s underground gas stocks are sufficiently high by the start of winter. If stocks are not on track to reach a minimum level identified by the French energy minister, the minister will order storage operators to build “security stocks” to achieve the minimum fill levels.

Storage operators would initially be able to use unbooked capacity for this purpose and, if necessary, unused reserved capacity. The costs of such security stocks would be covered by the French state. Energy regulator the CRE would define the terms and conditions for the creation of these stocks and the terms of their sale, and would develop tools to forecast the risk level of not achieving storage objectives.

The legislation also envisages an increase in the Arenh cap — the fixed price at which EdF has to sell nuclear output — to at least €49.50/MWh on 1 January, up from €42/MWh at present. It creates conditions to issue a decree which could raise the ceiling for greenhouse gas emissions to facilitate the restart of the Saint-Avold coal-fired plant, which closed at the end of March.

The senate began its examination of the draft law in its finance commission yesterday. President Emmanuel Macron’s party does not have an absolute majority in either chamber and the bill could be modified in the senate.

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