ENTSOG Southern Corridor (SC) Gas Regional Investment Plan (GRIP) 2014-2023 / Main Report

40 €/MWh

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PSV (Italy)

CEGH (Austria)

Greece

Figure 4.10: Comparison of gas prices in the SC Region

Figure 4.10 shows another side of the gas prices issue, namely the difference between the more liquid markets of the western parts of the Region (Austria and Italy), where hubs are operating, and less liquid markets like the one of Greece which however, thanks to the existence of an LNG terminal, offers more supply options than, for instance, the ones of Croatia or Bulgaria. The graph reveals: \\ A trend of progressive price-alignment between the Italian and the Austrian hubs, during the last two calendar years (2012 – 2013) which reflects the trend of increasing price correlation ongoing among all EU major gas hubs. \\ A difference between the above hub prices and the prices of a less liquid market like the one of Greece where the gas price is mainly set by the long term import contracts in place, with prices linked to oil or oil product prices, and may be further influenced by the price of occasional LNG or pipeline gas imports at spot prices. Most of the downward movements of the average Greek import prices correspond to such, one-off, imports. Additional factors contributing to this lack of alignment with the hub prices are also: a. The lack of physical (not congested) interconnections. We may assume that a bi-directional link between Italy and Greece might eventually extend the alignment dynamics already experienced elsewhere. b. The difference in climatic conditions (example: absence of cold snap in February 2012 in Greece) which, together with the lack of interconnec- tions, isolate Hellenic price from upward pressure in days of peak demand in neighbouring countries.

Southern Corridor GRIP 2014–2023 |

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