EN    EN EN 
 
EN    EN  COMMISSION OF THE E UROPEAN COMMUNITIES 
Brussels, 16.7.2009 
SEC(2009) 977 final 
  
COMMISSION STAFF WORKING DOCUMENT 
 
Accompanying document to the 
Proposal for a 
 
REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL 
 
concerning measures to safegu ard security of gas supply  
and repealing Directive 2004/67/EC 
  
THE JANUARY 2009 GAS SUPPLY DISRUPTION TO THE EU:  
AN ASSESSMENT  
{COM(2009) 363} 
 
 
EN 2   EN INTRODUCTION  
From 6-20 January 2009, gas flow s were interrupted from Russi a to the EU via Ukraine. A 
majority of Member States were affected dir ectly and indirectly. A lthough the disruption was 
a commercial matter between Gazprom of Russia  and Naftogaz of Ukraine, the EU was in 
regular contact with both parties before the onset of the disruption and throughout the event 
and was instrumental in the agreement on creatin g an international monitoring mission as well 
as facilitating negotia tions on an agreement for gas supplies into the EU to resume.  
This paper considers how the crisis developed and why exis ting provisions were not enough 
to avoid major disruptions to EU gas supplies in January 2009. It considers what the EU can 
learn from these events in order to make th e framework more resili ent and effective in 
responding to gas supply threats, both in an emergency situation and over the medium to 
longer term.  
This paper also responds to a specific request  from the European Parliament and from four 
individual MEP's for an analys is of the Russia-Ukraine gas crisis including the lessons 
learned.  
It reflects discussions and c onsultations which the Commission has held with Member States, 
including in the Energy Counc il and Gas Coordination Group, th e European Parliament and 
the industry, including Eurogas1, the European Federation of Energy Traders (EFET)2, the 
European Energy Regulators Group (ERGEG)3, and Gas Infrastructure Europe (GIE)4, 
Eurelectric and the International Federation of  Industrial Energy Consumers (IFIEC), as well 
as the assessment of the International Energy Agency. 
BACKGROUND  
One quarter of all energy consumed in the EU is  gas. 58% of this gas is imported. Of this, 
42% comes from Russia, and around 80% of EU im ports of gas from Russia pass via Ukraine. 
Among the 8 new eastern European Member Stat es, dependence on Russian imports averages 
77%. In practical terms, some 300-350 million c ubic metres per day (m cm/day) of gas passes 
through Ukraine towards the EU, around one fifth of total gas demand in the EU. Ukraine 
transits the same quantity of ga s on behalf of the EU as it consumes in its national market 
(around 300 mcm/day in winter). 
In November 2008, the European Commission a nnounced a revision to the Gas Security of 
Supply Directive 2004/67/EC in its assessment5 on the grounds that "today's legal framework 
could be improved. In particular greater harm onisation of security of supply standards and 
pre-defined emergency measures on regi onal and EU levels are needed".  
The EU legal framework for gas security of supply is largely regulat ed under the internal 
market framework, which governs issues such as transparency and access to networks, as well 
                                                 
1 Letter to Commissioner Piebalgs of 22 April 2009 
2 Letter to Commissioner Piebalgs of 30 March 2009 
3 Letter to Commissioner Piebalgs of 10 February 2009 
4 Letter to Commissioner Piebalgs of 30 April 2009 
5 Communication of the Commission … 
 
EN 3   EN as customers' rights. Trans-European Networks  for Energy funding is al so available to support 
key internal supply infrastructu re which has European priority6.  
As far as the response to potential supply disrup tions is concerned, the Gas Security of Supply 
Directive and the established Gas Coordination Group are the most important instruments, 
complemented by various levels of producer consumer dialogue, including the EU-Russia 
energy dialogue, EU energy relations with Norw ay, in the framework of the EU-Ukraine 
Memorandum of Understanding (MoU) on Energy as well other dialogue s with producing and 
transit countries.  
January 2009 is not the fi rst time that gas supplies to the EU  have been disrupted. Tensions 
between Russia and Ukraine and Russia and Belaru s have been raised several times since the 
break up of the Soviet Union due to the continuing difficulties to agree on the details of a new gas transit and supply regime. The absence of  a long term agreement has led to several 
disputes translating into supply uncertainty at  the start of calendar year. For the EU, with 
respect to EU’s gas supplies from Russia tr ansiting through Ukraine, the most serious 
disruption before that of January 2009 occu rred in January 2006. On that occasion, gas 
supplies to the EU were restored after one day of disruptions and available storage capacities 
easily made up the shortfall (some 80 mcm). 
In order to respond to increasi ng concerns of possible disrupti ons of gas supplies to the EU, 
several initiatives were developed by th e European Commission. An Early Warning 
Mechanism has been developed within the framework of the EU-Russia Energy Dialogue 
based on establishing direct communication lin ks between the European Commission and the 
Government of Russia for notifying in advance possible supply disruptions. Additionally, the 
Thematic Groups of the Energy Dialogue addre ss potential supply and demand risks in the 
medium and long-term. At the Permanent Pa rtnership Council meeting in October 2008, the 
EU and Russia agreed to enhance the Early Wa rning Mechanism and include also practical 
steps to resolve supply disr uptions. Moreover, in  the implementation of the EU-Ukraine 
energy MoU a specific working group has been esta blished to address the issue of enhancing 
the security of energy supplies. In this contex t, an International Inve stment Conference on the 
modernisation of Ukraine’s gas transit syst em was hosted by the Eu ropean Commission on 
23
rd March 2009 in Brussels, which resulted in  an agreement between the Commission, 
Ukraine and the international financial institu tions (EIB, EBRD and World Bank) on the way 
forward for the reform and modernisation of Ukraine’s gas transit system. In addition, an 
Early Warning Mechanism is under development with Belarus and energy discussions with Moldova have also addressed the issue. 
B
RIEF OVERVIEW OF THE JANUARY 2009  GAS CRISIS  
The January 2009 gas crisis resulted from an  unresolved commercial dispute between 
Naftogaz (Ukraine) and Gazprom (Russia). Re portedly, Gazprom stoppe d supplying gas for 
Ukrainian consumption on the 1 January 2009 while  gas to be transited through Ukraine for 
European consumption continued to be deliver ed to Ukraine. Normal transit to the EU 
continued through 1st January. 
                                                 
6 Since 1995, TEN-E has supported 94 gas interconnection projects, with a total of €143,000,000  
 
EN 4   EN On 2nd January, gas deliveries to several European Member States were affected, notably 
Poland, Slovakia, Hungary, and above all Bulgaria and Romania. On the same day, Czech Prime Minister Topolanek (as President of th e Council) met consecutively with Russian and 
Ukrainian representatives. In parallel, Czech  Deputy Prime Minister for European Affairs 
Vondra met with the Gazprom deputy chairma n, Alexander Medvedev. On 8th January 2009, 
President Barroso held a meeting with the CEO of Gazprom. Alexei Miller.  
Until midnight of the 6
th January, minor reductions of gas volumes were encountered in the 
EU, gradually increasing to 33% on the West ern Balkan route and 11% at the Western 
Ukraine entry points. From 1 am on the 6th January, it was reported that all supplies through 
Western Balkan route were cut to Romania, Bulgaria, Greece, FYROM and Turkey. At 10am 
on the 6th January only 10% of gas was reported as flowing to Slovakia, the main entry point 
for Russian gas supplies towards the EU, to be distributed further to Austria, west Hungary, 
Czech Republic, Germany, Italy, France, Slovenia  and Croatia. Very low level of gas flows 
was reported from Poland and the east Romania entry points. East Hungary received only 
20% of gas, which also affected supplies to Serbia and Bosnia and Herzegovina.  
On the night of 6th to 7th January, all supplies from Russia through Ukraine to the EU were 
cut. There were no gas supplies from Russia to Europe from 7 January to 20 January.  
In response, the EU, led by the Czech presidency and the Commission, started their efforts 
aiming to facilitate an agreemen t between the partners at two levels: the Russian government 
and Gazprom in Russia, and the Ukrainian g overnment and Naftogaz in Ukraine. This 
resulted in the signing of a monitoring agr eement between Ukraine, Russia and the EU on 9th 
January, which provided for independent monitors from all the involved parties to oversee the 
gas transit on Russian and Ukrainian territor y. The agreement was ratif ied by all parties in 
Brussels on 12th January. As early as 8 January, the European gas industry associations, 
including Eurogas and Gas Infrastr ucture Europe (GIE), had identified experts to participate 
in the EU monitoring team along with the Co mmission’s representative s. These monitors 
were immediately dispatched to monitor the s ituation with respect to gas flows on the ground. 
On 17th January, Russia hosted a high level summit in  Moscow, with the participation of the 
EU and the Russian and Ukrainian representati ves. This resulted on 18th January in an 
agreement between Russian Prim e Minister Putin and Ukrainia n Prime Minister Timoshenko. 
On 19th January, within the scope of this po litical agreement, Gazp rom and Naftogaz signed 
new 10-year agreements on the purchase of gas by Ukraine and the transit of gas to the EU 
via Ukraine. On 20th January, normal gas transit towards the EU was resumed 
The EU was not the only victim of the crisis. Other non-EU countries in south-east Europe 
suffered significant disruptions to their ener gy supply, with the in ternational community 
stepping in to supply emergency fuel aid to Moldova. Finally, both Russia and Ukraine 
suffered damage to their reputations as relia ble energy partners for the EU as well as 
substantial losses of revenue (for example Gazprom estimates its lost sales to the EU to be around $2 billion in the first three weeks of January). 
7.  
                                                 
7 Additional information on the chronology of the events, including records of gas volumes and flows, 
can be found in the comprehensive IEA report Th e Ukraine-Russia Gas Disp ute (20.01.2009) and the 
IEA Secretariat's note Overview of the Russia - Ukraine gas dispute of January 2009 (11 March 2009). 
 
EN 5   EN LEADING UP TO THE CRISIS : EARLY WARNING AND CRISIS PREVENTION   
On 18th December 2008, Gazprom announced that it w ould interrupt supplies to Ukraine as of 
1st January 2009 unless agreement was reached over Ukraine's outstanding payments and a 
new contract signed. Russia offi cially activated the EU-Russia Early Warning Mechanism on 
18th December 2008. The Russian Deputy Prime Mi nister and Chairman of the Gazprom 
Board of Directors Viktor Zubkov wrote to Pres ident Barroso and 27 Member States to warn 
them that a gas interruption could be inevit able as a result of the impending gas supply 
dispute with Ukraine. 
Political contacts between the Commission (C ommissioner Piebalgs an d President Barroso) 
and the Russian authorities and leaders of Gazprom took place over the Christmas period. 
President Barroso spoke to Prime Minister on 31st December and again on 6th January 2009, 
when he also spoke to the Ukrainian Prime Minister, Ms Timoshenko.  
In anticipation of difficulties , the Commission alerted the Ga s Coordination Group and other 
concerned parties on 19th December and convoked a meeting of the Gas Coordination Group for 9th January 2009. In parallel, a monitoring sy stem was put in place by Gas Infrastructure 
Europe at the entry points of the EU invol ving Poland, Slovakia, Hungary and Romania on 
the 3
rd January.  
The European Network of Energy Security Correspondent (NESCO) was also used to 
exchange information in an impromptu way on th e evolution of the situation in EU Member 
States as well as other th ird countries concerned.  
Although the EU-Russia Early Warning Mechanism had warned about the possibility of the 
crisis in late December 2008, th ere was no further notification by Russia that supplies to and 
through Ukraine would be in fact be totally cut, which occurred on the 6th and 7th January. 
There was no contingency plan at national or EU  level as to how to react to an unforeseen 
major disruption, which industry repres entatives had thought "impossible". 
At the EU level, a major difficulty in assess ing how best to respond to the crisis was the 
limited access to important technical information w ith respect to the gas system and gas flows 
at a national and an EU level. There was not  enough reliable information about gas flows, 
how much gas was in the system, and demand pa tterns. This situation reflected on the fact 
that qualitatively different systems exist ac ross Member States, with unequal access to 
information by market players and ot hers, including public authorities.  
As the crisis developed, the Gas Coordination Group helped to fill this information gap and 
enabled an exchange of detailed daily informati on and the analysis of th e gas situation of the 
different EU Member States and Count ries of Energy Community Treaty.  
However, the crisis came too early to benefit fr om the provisions of the third internal market 
package that had been proposed by the Eu ropean Commission on September 2007 and only 
recently finally adopted, which includes an obli gation to publish data on forecast and actual 
gas flows, amount of gas in storage and av ailable pipeline and storage capacities. 
DIFFERENT MODELS OF DATA PROVISIO N RELATING TO SE CURITY OF GAS 
SUPPLY IN MEMBER STATES  
 
EN 6   EN i) Live, updated and aggregated informati on on demand and supply forecasts, transmission 
and capacity detail and storage levels, disc losed to the public in real-time (e.g. UK).  
ii) Daily information on demand and supply foreca sts, storage capacities, contracted quantities 
and consumption patterns confid entially shared with the re gulator alone (e.g. Austria). 
iii) No information on storage levels even fo r the regulator or government representatives 
The absence of reliable information about the gas transiting through Ukraine to the EU also 
hindered decision-making. In effect, the EU ha d become victim to a commercial dispute 
between two non-EU companies resulting partly from  their move to put their relationship on a 
more commercial basis. The EU was aware of the shut-downs of gas supply that were causing 
major difficulties for industrial and household c onsumers, but did not have adequate access to 
information about the flows of gas which were c ontracted commercially for distribution to its 
customers.  
The uncertainties of whether and to what extent  the EU would be aff ected, and of how much 
gas was in the transit system once supplies were  reported to be resumed, were major barriers 
to developing a coherent response.  
Lessons for the EU:  
A disruption on the scale of the January 2009 ga s disruption might happen again. The EU is 
vulnerable not only to commercial disputes as happened in this ca se, but also to the risk of 
accidents or technical failures on major gas import pipelines. 
The early warning and crisis prevention mechanisms  at the EU level are weak in dealing with 
a sudden and unforeseen crisis. Th e situation at the moment is largely based on an assumption 
that national responses exist and will be enough.  
A major barrier to understanding the situation an d taking appropriate deci sions was a lack of 
transparency and access to up-to-date informati on. Decision makers at both the political and 
market level need reliable and aggregated information about demand, supply and storage in 
order to take adequate actions  responding to th e situations of gas s upply disruptions. Crisis 
prevention measures depend on having such  information available and updated on a 
permanent basis.  
The reliability of reporting mechanisms is even  more important in an emergency situation. 
Comprehensive market data needs to be avai lable, without restriction, on a daily basis, 
bearing in mind the possible need of recipien t bodies to respect th e standard commercial 
confidentiality requirements.  
There is inadequate coordination and coheren ce between national provisions to anticipate and 
avoid crises. Greater consistency in crisis  prevention might be achieved for example by 
regular exchanges between Member States about  the situation of emergency measures and 
peer reviews of risks assessments among Member  States. Existing bodies, such as the Gas 
Coordination Group and the Network of Energy Security Correspondents have to be involved. 
In spite of discussions in the Gas Coordina tion Group, where some disr uption scenarios (e.g. 
Yamal disruption) had been presented before al ong with the Winter Outlook of GIE, all based 
on rough data, common scenarios are lacking. There are no common scenarios for dealing 
 
EN 7   EN with emergency situations prepared in a dvance, involving regional or EU level risk 
assessments and detailed assessments of th e market situation (demand patterns, main 
suppliers, alternative sources, stor age possibilities etc). If these had been available, e.g. in Gas 
Coordination Group, it may have been easier to put in place contingenc y plans to cover for 
disruption of major supply route (e.g. acci dent, if not commercial dispute).  
Scenarios could also be usefully  coordinated with in frastructure planning  procedures, via the 
proposed European Network of Gas Transm ission System Operators (ENTSO – G).  
Enhanced engagement with EU’s major supplie r and transit countries can also provide an 
appropriate framework for developing ea rly warning mechanisms and adequate 
communication links for notifying of possible diffi culties and facilitating possible solutions in 
case of disruption of gas supplies.  
THE EXTENT OF THE CRISIS : ASSESSMENT OF THE EMERGENCY PREPAREDNESS AND 
RESPONSE MECHANISMS  
The January 2009 gas disruptions resulted in the mo st serious gas supply crisis to hit the EU 
in its history, depriving EU Member States of 20% of their gas suppli es (30% of imports). 
Coinciding with a cold spell in many parts of Europe, it demonstrated the vulnerability of the 
EU and some of its Member States to gas disruption and resulted in important economic 
repercussions in a numbe r of EU Member States8. Within days of the supply interruption of 6 
January, a total of 12 Member States and Memb er Countries of the Energy Community were 
affected. It was also clear that the interr uption could not be resolved by individual EU 
companies or TSO's alone. 
Although the existing Gas Security of Supply Directive obliges all Member States to have gas 
emergency measures, the emergency plans, triggers  and the extent of these mechanisms differ 
from country to country, or are not yet even  developed. During the January crisis, some 
Member States declared emergencies as a re sult of their national situation and launched 
emergency plans. Some adopted and implemented concrete plans and measures on the first day of crisis, while others had no detailed plans in place.  
The level of preparedness of the different Member States varied significantly. Where 
emergency planning existed, the em phasis was on small, practical steps at a local or national 
level. Also, the measures applied, such as use of  gas storage, focussed on  the first reaction to 
supply cuts in the short term. Substantially incr easing reliance on coal and fuel oil would also 
have been unsustainable due to environmen tal constraints (e.g. Large Combustion Plant 
Directive and emission quotas). Had the crisis continued for a longer period, or spread to 
other parts of the EU, the impact could have be en much more devastating in economic, social 
and environmental terms.  
The Gas Coordination Group met for the first time on 9
th January and immediately identified 
a list of response measures. The first response , where this was possible, was to access gas 
from storage. However, the rates of release and extent to which gas was available varied from 
Member State to Member State (e.g. storage re presents 35% of gas demand in Bulgaria, 97% 
in Slovakia). Most Member States and Energy  Community countries, with the exception of 
                                                 
8 Source: Regional Centre for En ergy Policy Research, Budapest 
 
EN 8   EN Bulgaria, Moldova and Serbia, were able to substitute the supplies from Russia in the short 
term, either by drawing on storage, by impor ting additional spot LNG cargoes (such as 
Greece) by fuel-switching and by extra commerci al deliveries from neighbouring countries 
(such as Austria, Hungary and Czech Republic).  
Diversification of routes but especially sources  was another widely used emergency measure: 
imports from alternative supplie rs increased, namely Norway and Libya, along with increased 
Russian imports via Belarus and Turkey. In so me cases, gas was cut off to large industrial 
companies (for example in Bulgaria, Romania, H ungary and Poland) in an attempt to keep gas 
flowing to households. 
Some fuel switching took place, particularly to wards fuel oil for heating and coal for power 
production (including Austria, Slovakia, Greece,  Poland, Bulgaria, and Romania). LNG also 
proved itself a useful alternative, although th e full compensation of the missing volumes was 
not possible.  
The existing Gas Security directive encourages Member States and companies to collaborate 
with neighbouring countries, including on access to storage. Such arrangements were highly 
necessary during this crisis and proved to be an  essential part of the response. However, there 
was no regional strategy among the Member States affected, despite their evident 
interdependence.  
Political bilateral agreements (e.g. Bulgaria and Serbia with Russi a) proved to be less 
effective than market arrangements between gas undertakings within the EU internal market 
framework in helping to keep supplies flow ing. The deepening crisis highlighted the 
importance of robust and consistent  regulation to ensure the ade quacy of networks, at both the 
transmission and distributions levels, to deal  with widely diverging demand and supply and 
maintain services.  
Pricing systems appeared to be relatively insensitive to the crisis. Price reactions were almost 
non-existent in eastern Member States. This su ggests a lack of market functioning in these 
regions. However, in other parts of the market, reactions were more dramatic with 10% rises 
on NBP in UK, and a 25% increase at Zeebrugge in  Belgium. Direct and indirect subsidies or 
price distortions, either at the public level or through commercial policies, were identified as 
reducing the capacity for markets to deal with supply emergencies by re moving incentives for 
investment in new infrastructure and for greater efficiency in energy use9. 
The crisis affected above all consumers. Ma intaining services to household consumers was 
generally given priority throughout  the crisis, although it appears that poorer households were 
most likely to shift to alternative and ineffi cient alternatives (ele ctricity, wood-burning, 
particularly in Bulgaria). Where major shorta ges occurred, industrial customers had to reduce 
demand (e.g. Bulgaria, Romania, Poland's largest fertiliser plant and refinery). Some Member 
States, such as Hungary, Slovakia,  issued calls to cut back on gas consumption for industry.  
Beyond this, energy demand management policies proved insufficient and largely irrelevant 
due to the need for mid-winter heating and the inefficiencies of district heating systems and 
insulation standards. There wa s no properly worked out strate gy which would have reduced 
energy demand more evenly, involved the w hole economy and ensured that no country 
                                                 
9 The Russo-Ukrainian gas dispute of January 2009: a comprehensive assessment, Oxford Institute for 
Energy Studies, Feb 2009 
 
EN 9   EN suffered an undue impact on its economy, an d on its environmental commitments (e.g. 
heightened emissions from coal plants). 
LESSONS FOR THE EU:   
There is considerable scope to improve the le vel of preparedness at national and EU level. 
Emergency planning was greatly hampered by a lack of consistency, coherence and 
comparability between the various definitions and measures which exist in the different 
Member States. Where measures were in place, their effectiveness was curbed by the narrow 
and localised approach to tackli ng supply difficulties, a lack of options to diversify supplies, 
and by a lack of access to up-to-date and complete information on supply, storage and 
demand.  
The EU needs to have common criteria on whic h Member States can base their emergency 
planning, and these need to be de veloped not just at the national level, but also at a regional 
and EU level with a view to the EU internal market dimension. Reactions based on national 
markets risk hampering the ability of gas traders to keep gas flowing efficiently in the internal 
market and thus exacerbate the situation for the EU as a whole. 
Energy saving and energy switching should be better highlighted w ithin prevention and 
emergency plans and seen as a firs t, rather than a last resort.  
Access to storage is a useful emergency measur e, but cannot be relied on for longer periods 
and cannot substitute for better interconnections  to keep gas flowing (see also below The EU 
gas market )  
RESPONDING TO THE CRISIS : THE FUNCTIONING OF THE EU GAS MARKET AND 
TRANSPARENCY  
Early in the crisis, Europe's gas industry showed its ability to deal with some aspects of the 
European dimension of the problem. The existence of trading agreements and supply contracts enabled companies to work together to maintain supplies to domestic customers, 
schools and hospitals, during the coldest days of the crisis. For example, Russian gas was made available to Czech Republic via the Ya mal pipeline, Czech gas storage was made 
available to Slovakia, Austri an gas storage to Slovenia. 
New supply contracts between companies emerge d during the first days of supply disruption 
(GDF/EON to Serbia and Bosnia and Herz egovina, ENI to Croatia). Hungary allowed 
domestic and transit gas to Serbia and Bosnia.  
New reverse flows from Greece to Bulgaria a nd from Czech Republic to Slovakia became 
operational after 18
th January.  
Cooperation between individual companies (e.g. EON to Hungary) also took place, according 
to pre-arranged commitments. According to the gas industry10, "commercial arrangements 
such as swaps and short term trades allowe d a quick response to customers needs".  
                                                 
10 Letter from Eurogas to Commissioner Piebalgs, 22 April 2009 
 
EN 10   EN At least in some of the affected Member Stat es (Germany, Italy and Austria) the markets were 
able to continue supplies without any emergency interv ention due to adequate 
interconnections, adequate gas in the system and back-up storage. 
From the start, the gas industry made significant e fforts to deal with the shortages, as well as 
to cooperate with public authorities. Howe ver, common problems f aced by many suppliers 
included: the lack of alternative suppliers, lim ited or non-existent connections to alternative 
supplies, slowness of accessing gas from storag e, few options for fu el-switching and high 
levels of demand as a result of cold weat her. These technical problems highlighted 
weaknesses in the way the internal market  functions and whic h call for regulatory 
intervention.  
Gazprom, which was now in breach of its supp ly obligations to EU consumers which are 
normally supplied by transit through  Ukraine, took some steps to help reduce the extent of the 
disruption by increasing supplie s via alternative routes ( notably through the Yamal and 
Bluestream pipelines). Although limited (around 12% of the cut), thes e additional supplies 
replaced some of the mi ssing gas supplies where inte rconnections existed.  
Norway also increased production to help fi ll the shortfall in EU supplies. On 6th January 
2009, gas production in Norway, the EU's second mo st important source of gas imports, was 
at an all-time high (342mcm/d). This helped to  mitigate supply concerns in parts of the EU, 
although the additional supplies could not reach Eastern Eur ope due to the lack of 
interconnections, and different standards of gas.  
Two Norwegian production fields (Kristin a nd Åsgard) had to be shut down from 8th -12th 
January due to rough weather conditions. This le ft excess capacity in th e Norwegian transport 
system towards the EU. During this period, tota l deliveries of Norwegian gas amounted, with 
some exceptions, to 320-340 mcm/day, with a total transporting ca pacity of about 350 
mcm/day. In addition, a compressor facility (B11) was out of operation, which reduced flexibility in the overall export system. Bottlenecks further downstream in German 
infrastructure implied that gas that could have been rerouted to the Continent was instead sent to UK despite lower prices. Impor tantly, all available gas was routed to the market, but not 
necessarily to the market where prices were the highest.  
Although the UK was not directly a ffected by the crisis, an attemp t was made to help alleviate 
security concerns in continental European markets by transiting Norwegian gas to Belgium and from there across Europe. 
Despite reasonable cooperation between gas companies to exchange data, limitations on 
access to up-to-date and consistent information were an obstacle to making the most of market potential. In particular, the market wa s hampered by inadequate information on cross-
border gas flows and transparent informa tion on the flow of gas into the EU. 
Another obstacle was inadequate  coordination between Transmi ssion System Operators, who 
still had a largely national view of their market. This meant that in some cases such as Italy 
with Slovenia and with Germany, measures which brought local relief placed neighbours 
under additional strain.  
Events also highlighted shortcomings in th e gas pipeline network, on which the internal 
market is based. Additional supplies from th e Netherlands for example, where domestic 
production was increased in response to the crisis, could not reach  needy customers in 
 
EN 11   EN Bulgaria because the interconnections and sa me gas standards were not there. Lacking 
infrastructure also meant that available LNG supplies could not be supplied to where they were most needed, particul arly from Spain and Greece. 
Lessons for the EU  
The internal market principle, that one part of the market s hould help supply another at times 
of supply difficulty, proved valuable. 
The gas industry also showed that it can be la rgely relied on to deal w ith localised and very 
short term interruptions to s upply. In a wider or longer te rm emergency, or one involving 
external circumstances beyond th e control of market players,  political intervention or 
coordination is helpful. 
It was also the case that the market res ponse largely relied on ex isting obligations and 
commitments. Concrete scenarios to deal  with unexpected ri sks were lacking.  
Greater coordination among TSO’s and better coordination of access to pipeline networks 
could also have ensured that the available gas fl owed to the affected areas. This might have 
avoided some of the worst impacts of the disruption. 
While a well-functioning market is  beneficial for security of supply, account must be taken of 
the negative consequences which come from weaknesses in the existing market framework. 
Weak markets and/or inadequate regulat ion may not encourage spare capacity and 
infrastructure or transparen cy, including in pricing.  
Insufficient physical network integration, inadequa te transparency in network utilisation, as 
well as inflexibility in capaci ty reallocation and congestion management, inadequate price-
response mechanisms and lack of coordination are all factors which undermine the market’s 
response to a gas supply disruption. These will be at  least partly addressed in the new internal 
market legislation, but this makes it all the more  important to ensure th at the legislation is 
fully implemented and properly regulated. 
Differing understanding of public service obligati ons across Member States may also make it 
more difficult for the market to respond in a c onsistent manner to a cr isis. Again, the third 
internal market package shoul d help in this respect. 
Nevertheless, there is a strong case for strong er market regulation to tackle some of the 
weaknesses this crisis identified. The most seri ous and most immediately apparent of these 
was insufficient transparency. But other weakne sses which became apparent included missing 
connections or sustainable alternatives to pipelin ed gas, the absence of contingency plans, and 
an effective role for consumer s (energy demand management).  
Companies are willing to cooperate in a crisis, bu t to do so they need a clearly defined and 
consistent political framework. This needs to se t out clearly what const itutes a crisis, how to 
respond, and the respective role of ma rkets and public authorities.  
There is also a need for a be tter understanding of contract ual obligations among different 
market players, how adequate they are in an em ergency, and whether there is a risk of conflict 
if these come under strain. 
 
EN 12   EN The need for complete market transparency cannot be overemphasised. The internal market 
provisions on transparency may need to be tailored in case of a supply emergency. The 
market can only work at its most effective if al l market participants have equal access to all 
the available information.  
The question of infrastructure and interconnections is param ount. Markets work better when 
they are fully interconnected a nd where supply flexibilities ar e possible (see also below).  
RESPONDING TO THE CRISIS : EU ADDED VALUE  
During the crisis, a localised di sruption (in Eastern Europe) grew  into a EU-wide shortage of 
gas supplies affecting countries across the EU , including for example France, as well as 
Netherlands and UK that were actively involved in providing additional supplies. The scale of 
the gas supply disruptions required an adequate  response at the EU level, however, a clear 
strategy as well as concrete  instruments were lacking. 
The European Commission, in close coordina tion with the Council Presidency, ensured 
coordination within the EU and f acilitated contacts with the interested parties. These efforts 
were instrumental in ensuring a common EU position and speaking w ith a single voice in 
contacts with third partner countries.  
In addition, in order to address the difficulties  in access to the releva nt information, a fact 
finding mission composed of representatives of  the Commission and the Czech Presidency 
was deployed to Kiev and Moscow on the 4th January. This was complemented at a later stage 
by deployment of experts from the industry an d the European Commission, in cooperation 
with the European Gas Industry and the Eu ropean Gas Transmission Operators, on the 
Russian and Ukrainian territory for monitoring of gas flows to the EU. 
The European Commission also exchanged valuab le information with the Member States on a 
regular basis throughout the crisis. This t ook place mainly through the Gas Coordination 
Group (meetings on 9th and 19th January), through the Netw ork of Energy Security 
Correspondents where relevant information wa s disseminated and at the level Directors 
General for Energy in a meeting held on 21st January. The Czech presidency held an 
extraordinary Energy council on 12th January where Russian and Ukrainian Ministers 
attended to provide additional clarif ications on their re spective positions. 
With respect to third partner countries concer ned, namely Russia and Ukraine, the European 
Commission facilitated contacts between the part ies, in order to seek an adequate solution 
with the objective of resuming gas supplies to the EU. The high level po litical contacts that 
took place throughout the crisis were complemented  by regular contacts on a technical level 
with the Russian and Ukrainian officials and re presentatives of Gazprom and Naftogaz. This 
enabled also the above-mentioned deployment of experts and facil itated the eventual 
resumption of gas supplies to the EU. 
The Commission worked closely with the gas indu stry throughout the crisis. Regular meetings 
took place between the Commi ssion and Eurogas, including a high level meeting between 
President Barroso and head s of gas companies on 20th January 2009. 
The crisis therefore demonstrated some of the potential benefits of coordination, exchange of 
information and advice between the European  Commission, gas industr y and Member States 
 
EN 13   EN which took place, including at the level of the Gas Coordination Group (GCG). 
Representatives of the Energy Community11 were also present at the GCG meetings of 9th and 
19th January, as they were also seriously affected by the crisis. However, it remains the case 
that the provisions of the Gas Security directiv e were insufficient in order to enable the EU 
and Member States to fully understand the extent and the impact of the crisis.  
In the aftermath of the cris is, the GCG members responded to an ad-hoc questionnaire 
requiring more detailed data th an MS would be obliged to pr ovide under the provisions of the 
Gas Security of Supply Directive. All Member St ates cooperated and nearly all provided the 
replies. This contributed to being able to a ssess the situation correctly at an EU level.  
Finally, with respect to the European Parliame nt, information was provided on a regular basis 
throughout the crisis and in its aftermath by Commissioner Piebalgs and the Czech 
Presidency. This included the par ticipation at plenary sessions 14 January and 1 February 
2009, as well speaking to the Conference of Presidents on 8 January. The European 
Parliament held a further hear ing on this issue on 2nd April 2009. 
Lessons for the EU 
Security of supply clearly needs to be part of  a common and coherent energy policy of the EU 
and full consideration needs to be given to the long and short term dimension of security of 
gas supply. The internal market dimension ha s to be complemented by a strong external 
relations element.  
Interdependence in gas supply in the EU has increased and continues to do so. Within the 
internal energy market, a significant disrup tion affecting one Member State can quickly 
become an issue for the wider European ma rket. Therefore a greater consistency and 
collaboration is needed across the EU, in pa rticular as regards the common objectives and 
standards of EU’s security of gas supply. 
Within the EU, the work of the European Co mmission in terms of coordination and bringing 
together Member States and indus try contributed during the January  crisis to a more coherent 
action at the EU level. The Gas Coordinati on Group proved to be a very useful body, 
anticipating and contributi ng to identifying solutions to gas supply problems at the EU level. 
It is also a helpful instrument to bring togeth er all interested parties, at the political and 
industrial level. The GCG could also have th e potential to enhan ce communication between 
network operators and to coordinate  emergency and solidarity measures. 
Consultation, communication and exchange of info rmation are crucial at the European level, 
whether a disruption arises or not  in order to ensure a European  security of gas supply. It is 
vitally important that the EU communicates wi th a common voice, both at home and when 
speaking with third countries.  
During the January gas crisis, the EU succeeded in maintaining a common approach despite 
the pressure from some EU Member Stat es. The cooperation between the European 
Commission and the Czech Presidency, with the active support of the Gas Coordination 
Group, was key in maintaining a strong, consiste nt message internally and underpinned the 
                                                 
11 The Energy Community includes the European union, Albania, Bosnia and Herzegovina, Croatia, 
former Yugoslav Republic  of Macedonia, Monteneg ro, Serbia and Kosovo 
 
EN 14   EN efforts undertaken externally with Russia and Ukraine. It facilitated an agreement that 
eventually made possible the resumption of the supplies of gas to the EU.  
Likewise consultation, communication and exchange  of information are crucial with supplier 
and transit countries in order to prevent and carefully manage possible problems with respect 
to the EU’s external gas supplie s. The initiatives that  are already underway, such as within the 
EU-Russia Energy Dialogue, the implementation of the EU-Ukraine energy MoU as well as 
the ongoing energy discussions with Belaru s and Moldova, should continue and be 
intensified. In this context, the EU needs to insist that intern ational treaties and transit/supply 
agreements are respected. [Where possible, relevant provisions building on the existing 
frameworks and commitments should be reflected in bilateral agreements.] 
The appointment and prompt dispatching of EU monitors made a useful contribution to better 
understanding and identifying po ssible solutions to the probl ems in EU’s external gas 
supplies. A consideration should therefore be gi ven to providing the EU with an adequate 
capacity of experts able to  carry out this role.  
The involvement of the Commission, in collabora tion with the Council Presidency and with 
the support of the European Parliament and Euro pean industry, in speedin g a resolution of this 
crisis has important implicati ons for energy relations between the EU and external partners. 
The strength of its internal energy market and internal energy policy are factors which 
contribute to EU’s cr edibility externally. 
RESPONDING TO THE CRISIS – THE ADEQUACY OF INFRASTRUCTURE AND POTENTIAL FOR 
DIVERSIFICATION  
The gas supply disruption lasted a total of 14 days. It took almost as long for emergency 
network options, such as reverse flows, to be implemented where interconnections where 
already in place.  
It was assessed that it was mainly the inadequacies in gas transport which constrained flows 
(capacities, reverse flow capabil ities, unusual routes, insufficien t integration of gas networks 
in Central and South Eastern Europe), not an aggregate shortage of gas. Theoretically, the 
shortfall (300mcm per day) could have been fully compensated by increased imports from alternative sources and withdr awal from gas storage (availa ble spare storage withdrawal 
capacities at EU leve l of around 800mcm).  
The Commission has repeatedly warn ed of the risks to security of supply arising from the lack 
of adequate interconnections, the inadequate possibilities for re verse flows and the limits to 
fuel switching which exist in certain parts of the EU market, most recently in the November 
2008 Strategic Energy Review. The events of January 2009 vindicated these concerns and 
highlighted how the lack of interconnections and diversifi cation options (route and fuel 
source) can exacerbate a supply crisis.  
As the crisis developed, the importance of suffi cient infrastructure and of access to diverse 
sources of supply became evident. Countries wh ich coped best were able to take up other 
options very quickly, e.g. more frequent Liquefi ed Natural Gas deliveries in Greece, Italy and 
France, increased import via Yamal and Norw ay for Poland, Czech Republic and Germany, 
additional supplies from Libya to  Italy, more cross border trade within the EU, for example, 
from Austria to Hungary.  
 
EN 15   EN The most seriously affected Member State, Bu lgaria, had no other im port options, no other 
gas supply option such as LNG and no opti on to increase domestic gas supply.  
Access to additional domestic gas production was limited. In those countries which were 
affected with domestic gas resources (Romania , Hungary, Italy and Poland), there was limited 
scope to increase production. The other main producers, UK and Netherlands, were better 
able to increase supplies, and both increased their gas transpor t towards the affected area. 
However, this gas failed to reach the most affected areas due to missing pipeline links.  
Investment in alternat ive gas supplies paid off for thos e Member States who had already 
pursued a policy of supply diversification. Slov enia for example was able to compensate for 
Russian supplies as it only imports 50% of its gas from Russia, and more than one third from 
Algeria. Czech Republic, Austria and Hungary we re also able to compensate by Norwegian 
gas imports via Germany.  
Reverse flow proved a problematic option at the time and came too late to make a real 
difference, particularly in Bulgaria. However, had the crisis persisted, the role of reverse flows might have been signifi cant. On 18 January, Slovakia, together with RWE Transgas 
(the Czech Republic TSO), reversed the flow on the main East-West transit pipeline. The next 
day, one day before the resumption of Russian supplies via Ukraine, Greece reversed gas 
pipeline flows to Bulgaria. The fact this was possible is a promising development for the 
future. 
Those Member States where gas is an impo rtant fuel for electricity generation faced 
additional difficulties. In Slovakia, the cut in  gas supplies from Russia put the electricity 
system under severe strain. The situation was eased by the provision of additional gas from 
within the EU. In Germany, demand for lignite for power production increased such that the industry had difficulty to cope with demand. In Bu lgaria, there was pressu re to reopen nuclear 
reactors at Kozloduy. Likewise, Slovakia consider ed the possibility of  reopening the nuclear 
reactor at Bohunice in Slovakia in  response to the gas crisis.  
Lessons for the EU 
The crisis confirmed that the EU needs to di versify its supplies in terms of supply source, 
supplier, transit route and fuel fo rm (natural gas or LNG). It al so highlighted the benefits of 
diversifying energy sources toward s indigenous fuels, providing th ese are also sustainable and 
competitive.  
A more interconnected market, more flexibilit y in gas transport and more fuel-switching 
options can also help mitigate the risks of  a significant reliance of a single supplier. 
Reverse flow was recognised as potentially powerful tool for mitigating the effects of 
disruptions to supply. However, more investment in the relevant infrastr uctures are needed to 
ensure that this possibility exists across the EU’s internal market. The GIE task force to 
examine reverse flow options set up in February 2009 is a timely development. 
Access to gas storage is useful fall-back wh ere gas flows are restri cted. Development of 
commercial storage is a positive step where this  is attractive technically, economically and 
geographically. Ongoing investment in new storage sites confirms that storage is an option of 
growing interest to the gas sector.  
 
EN 16   EN The importance of a stable regulatory framework to encourage urgently needed investment in 
infrastructure and interconnections was also confirmed. 
The crisis confirmed the politi cal and economic reasons for gr eater diversification of gas 
supply, particularly in Central and Eastern Europe . However, it also illu strated the barriers to 
investment in major new infrastructure projec ts: as long as the cost to industry of the 
disruption is limited, as was the case in Ja nuary 2009, the commercial justification for 
additional capacity for the worst case scenario remains weak.  
The importance of a speedy agreement on criter ia for the new 10-year network development 
plans by ENTSO-gas and regulators became ev ident. The experiences of January 2009 
suggest that these will need to take full acc ount of security of supply as a public good, and 
scenarios for crisis prevention and mitigation.  Both short term and longer term solutions 
should be considered. The aim should also be for heightened cooperation between regulators 
and TSO's in Member States when developing and implementing infrastructure plans with a 
view to improved cross-border measures  and greater reverse flow capacities.  
The EU needs to consider ways of making inve stment in infrastructure more attractive in 
Eastern Europe. One way might be via the Ne w Europe Transmission System (NETS) project 
to integrate gas transmission systems opera tors across central a nd eastern Europe.  
This situation requires longer term planning and investment . The measures included in the 
Economic Recovery Plan and Strategic Ener gy Review (e.g. Baltic Energy Market and 
Interconnection Plan, interconnect ions in central and south eas tern Europe, the Southern 
Corridor as well as an LNG strategy) and th e new provisions to oblige the new ENTSO to 
develop 10-year plans, will help address thes e shortcomings. The Commission's initiative, 
presented in the second Strategic Energy Re view, to develop a new Energy Security and 
Infrastructure Instrument is also relevant.  
An important element which has been greatly  overlooked as a tool in preventing and 
alleviating crises is energy efficiency. Great er energy efficiency across the whole energy 
spectrum, and a more efficient use of gas in a ll its processes (water and space heating, power 
generation) is needed to enable the EU to do more with the gas which it has. 
CONCLUSIONS  
A repeat of the January 2009 gas supply crisis, from a similar or  different cause, can not be 
ruled out.  
The Commission’s concerns that the EU energy s ecurity strategy must be strengthened are 
therefore completely vindicated.  
The crisis highlighted weaknesses in each stage of the gas supply security approach at EU 
level:  
– The early warning mechanisms at national an d EU level are inadequate. Early warning 
mechanisms within the EU as well as with  supplier and transit countries should be 
strengthened or put in place. They should be underpinned by appropriate bilateral and 
multilateral agreements with the EU’s gas suppl ier and transit countries, including energy 
 
EN 17   EN provisions, building where possible on the re levant existing frameworks and provisions, 
such as within the WTO and Energy Charter. 
– Emergency planning needs to be made more  consistent and coherent among Member 
States, with common standards and coordinated responses;  
– The new internal energy market legislation s hould be implemented as quickly as possible 
in order to address weaknesses in market functioning which undermine security of supply 
and limit the ability of the market to d eal with supply threat s and disruptions;  
– Greater transparency and easier access to market  information is necessary in order to assess 
the supply situation wisely and taken necessary preventive and remedial action;  
– The lack of interconnections and the physical isolation, in energy term s, of some Member 
States, proved to be a real impediment  to dealing with a supply crisis.  
The crisis also confirmed the importance of certain principles of EU energy policy which 
deserve to be strengthened:  
– As far as possible, the market should be ab le to manage risks and crisis situations. 
However, this requires the regulatory framework to be adequately robust. There also has to 
be room for political intervention should this be necessary;  
– A national energy supply crisis quickly become s a European issue; conversely, European 
intervention can work more effectively th an individual national reactions and ensure 
security of gas supply across the EU.  
– Political solidarity in the EU is vital both in domestic responses, to ensure that the market 
can work properly, and in dea ling with external partners; 
– The importance of demand side management as an  important energy secur ity tool, as it was 
conspicuously absent from most  reactions. Any emergency re sponse must also focus on 
ways of reducing energy demand and divert ing demand towards other low-carbon fuels 
and technologies. This also has to be fully incorporated into  any longer term strategy on 
energy supply security; 
- Effective and transparent c oordination at the EU levels at the political, commercial, 
regulatory, and network level is key to re solving a crisis with  EU implications; 
The crisis also served as a wake-up call to polic y makers to strengthen their energy strategies:  
– Growing dependence on gas for electricity and domestic heating, with  limited options for 
fuel-switching, further increases the risk that  a gas supply crisis will have a deeply 
damaging economic impact; 
– Likewise, the dependence of part s of the EU on a single supp lier or a single source is a 
major concern to consumers across the EU an d calls for new efforts to increase supply 
diversification in supplier, s upply route and supply source.  
The crisis also confirmed the benefits of EU collaboration:  
 
EN 18   EN – The central role of the Commission as inform ation gatherer, mediator and monitor, in 
collaboration with the Council Presidency and supported by the European Parliament, proved fundamental to f acilitating a solution.  
– The value of the Gas Coordination Group in te rms of coordination and development of a 
coherent internal approach was fully demons trated. The contributi on of the Network of 
Energy Security Correspondents, bringing together the represen tatives of Ministries of 
Foreign Affairs and Ministries  of Energy, involved a useful exchange of the available 
information. Participation of th e third partner countri es concerned (Russia, Ukraine as well 
as Energy Community countries) on an ad hoc basis in these discussion s also provided a 
positive feedback. 
The events of January 2009 confirmed the importance of having emergency plans and 
measures in place at a national level, the need  to improve the Community dimension and the 
added value of a coherent EU approach to th e EU’s external energy security. The disruption 
of supplies affected a large number of Member St ates and the ad-hoc measures facilitated at a 
Community level did help to mitigate somewhat  the major economic impact the dispute had 
on some EU Member States. Clearly there is a need to formalise these arrangements and 
ensure that the Community is  better placed to face such situations in the future.  
 
EN 19   EN ANNEX  
1. Situation in Ukraine before the gas cut with flows of 31 December 2008 
 
 
EN 20   EN Source: Gas Coordination Group, DG TREN 
2. Picture: Situation in Ukraine after th e gas cut with flows of 1 January 2009 
The red boxes indicate the drop in gas flow to Ukraine after the cut. The volume of lost  gas is under the name of affected entr y points from Russia to 
Ukraine.  
 
EN 21   EN 
 
Source: Gas Coordination Group, DG TREN 
3. Picture: Situation in Ukraine after the gas cut to EU on 7 January 2009 at midnight 
 
EN 22   EN 
 
Source: Gas Coordination Group, DG TREN 
 
EN 23   EN 4. Picture: Main responses in Europe during the period of gas cut (from 7 to 20 January 2009) 
 
Source: Analysis of gas crisis presen ted to Gas Coordination Group by IEA