Merging markets: connecting Germany and Austria

By Joshua Posaner 23 March 2012
The Austrian states of Vorarlberg and Tirol suffer from a lack of interconnection with the rest of the domestic gas network. (E-Control/Interfax) The Austrian states of Vorarlberg and Tirol suffer from a lack of interconnection with the rest of the domestic gas network. (E-Control/Interfax)

Parts of Germany and Austria could soon form a single gas trading market, if negotiations to connect the Alpine regions of Tirol and Vorarlberg with the NetConnect Germany (NCG) network come to fruition this year, underlining the energy interdependency of both countries.

The NCG already facilitates market area cooperation between a range of gas transmission operators and traders in Germany, including the Open Grid Europe network. The move by the Austrian energy regulator to connect two of its isolated regions with the NCG is in line with the Austrian government’s Natural Gas Act legislation, which will transform the national market into a single virtual hub, with all trading through the Baumgarten hub as opposed to a series of over the counter border transaction points, by 1 January 2013. The legislation is part of Austria's reaction to the EU's Third Energy Package legislation.

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