Tag Archives: Natural gas

Internal market for natural gas

Outline of the Community (European Union) legislation about Internal market for natural gas

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These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Energy > Internal energy market

Internal market for natural gas

Document or Iniciative

Directive 2003/55/EC of the European Parliament and of the Council of 26 June 2003 concerning common rules for the internal market in natural gas and repealing Directive 98/30/EC.

Summary

Directive 2003/55/EC provides for the complete opening of national gas markets to competition and therefore helps create a true internal gas market within the European Union (EU).

Completion of the internal gas market increases competitiveness and improves service quality, guarantees fair prices for consumers, establishes rules on public service obligations, improves interconnection and bolsters security of supply.

Market access

Directive 2003/55/EC lays down the right of third parties to non-discriminatory access to transmission and distribution systems and to liquefied natural gas (LNG) facilities. Consequently, new suppliers can now enter the market and consumers are free to choose their gas supplier.

For the internal gas market to operate properly, all the companies, even the smallest ones, such as those which invest in renewable energy sources, must be able to enter the market. Fair competition conditions must be put in place to prevent the risk of dominant positions, in particular of the traditional operators, and predatory behaviour.

A gradual approach has been adopted so that companies can adapt whilst guaranteeing the protection of consumers’ interests. Since 1 July 2004, industrial consumers have been able to choose their supplier. Domestic consumers have had had this opportunity since 1 July 2007.

Access to storage facilities is covered by specific provisions by virtue of which access may be either negotiated or regulated.

System operation: system operators

In each Member State, system operators are appointed for the transmission system on the one hand, storage, liquefied natural gas and the distribution system. Their mission is the operation, maintenance and development of transmission and distribution, storage and liquefied natural gas (LNG) facilities. They are obliged to ensure the safety, reliability, efficiency and interconnection of facilities with due regard for the environment.

System operators must guarantee non-discriminatory and transparent access to the system for all users. Access must therefore be based on fair tariffs that are applied objectively.

System operators may not favour certain companies, in particular any with which they are associated. In order to avoid any discrimination relating to network access and enable equal access for new entrants, when companies are vertically integrated, the transmission and distribution activities must be legally and functionally separate from other activities, such as production and supply. This separation does not, however, mean ownership unbundling.

System operators are also obliged to provide other operators with the information necessary for safe and effective running of the interconnected system.

Public service obligations and consumer protection

The internal gas market can only become a reality if consumers play an active role and actually exercise their right to free choice of their gas supplier. It is therefore essential for operation of the internal gas market to inform consumers of their rights and to ensure their effective protection.

Directive 2003/55/EC lays down common minimum standards to ensure a high level of consumer protection (the right to change supplier, transparent contract conditions, general information, dispute settlement mechanisms, etc.) and takes particular care to provide adequate protection of vulnerable consumers (for example, by taking the appropriate steps to avoid disconnection of the gas supply).

Gas supply is considered as a public interest service that citizens have the right to access in return for payment. Therefore, the Directive provides for the possibility for Member States to impose public service obligations to guarantee security of supply, economic and social cohesion objectives, regularity, quality and price of the gas supply and protection of the environment.

Regulatory authorities

As key elements in the smooth operation of the internal gas market, independent regulators, appointed in each Member State, are responsible, in particular, for monitoring respect of the non-discrimination principle, the level of transparency and competition, and the tariffs and methods for calculating them. These regulatory authorities also act as dispute settlement authorities.

A European group bringing together the national regulatory authorities to consolidate the development of the internal gas market and ensure coherent application in all the Member States of the provisions of Directive 2003/55/EC (the European Regulators Group for Electricity and Gas – ERGEG) has been established through Decision 2003/796/EC.

Derogations

The Directive lays down derogations or allows for their laying down according to the terms of the Directive in certain situations:

for isolated markets, i.e. when a Member State is not directly connected to the interconnected system of another Member State and has only one main external supplier;
for emergent markets, i.e. markets where the first commercial supply of a Member State from their first long-term natural gas supply contract was made not more than ten years earlier;
for geographically limited areas in Member States, for example depending on the size and maturity of the gas system in the area concerned, as well as the pay-back prospects of investments required for application of the Directive;
in the event of a lack of capacity;
during development of the infrastructure capacity or of new infrastructures;
if access to the system prevents delivery of public service obligations;
due to serious economic difficulties of a gas company, in particular due to its ‘take or pay’ commitments (clauses of a gas purchase contract obliging the supplier, on the one hand, to make defined quantities of gas available and the customer, on the other hand, to pay for the gas, whether he has taken it or not).

Furthermore, safeguard measures may be temporarily taken by a Member State in the event of a sudden crisis in the market, or the physical safety or security of persons, apparatus or installations or system integrity being threatened.

Monitoring and security of supply

The European Commission draws up an annual benchmarking report that evaluates the progress in the implementation of competitive electricity and gas markets, on the basis of information supplied by national governments and regulatory authorities.

It is also essential to improve security of supply by guaranteeing sufficient investment in the transmission systems, thus avoiding interruptions to the gas supply, by monitoring the supply and demand balance in the different Member States, the interconnection capacity and the quality and maintenance level of the systems. Such monitoring will enable appropriate measures to be prepared ahead of any supply problems.

Scope

Directive 2003/55/EC applies to the gas market, which must be taken to mean natural gas, as well as liquefied natural gas (LNG), biogas, gas from biomass and other types of gas that can technically be transported in the natural gas system.

As a consequence, and while taking into account quality requirements and technical and safety standards, Member States must make sure to guarantee non-discriminatory access to the gas system of biogas and gas from biomass, as well as other types of gas.

Background

The existence of an internal gas market, parallel to an internal market in electricity, is essential for completion of a true internal energy market within the EU. The internal gas market was put in place, firstly, by Directive 98/30/EC, which was then repealed and replaced by Directive 2003/55/EC.

References

Act	Entry into force – Date of expiry	Deadline for transposition in the Member States	Official Journal
Directive 2003/55/EC	4.8.2003	1.7.2004	OJ L 176, 15.7.2003

Related Acts

Communication from the Commission of 11 March 2009 to the Council and the European Parliament – Report on progress in creating the internal gas and electricity market [COM(2009) 115 final – Not published in the Official Journal].
The Report examines the transposition of the second package of measures on the internal energy market. Many efforts have been made to introduce true competition, particularly as part of regional initiatives.

However, gas prices increased considerably during the first half of 2008, and the functional unbundling of distribution system operators (compulsory since 1 July 2007) has not been applied systematically. Member States still make extensive use of derogations in this area.

Moreover, the Commission has few figures available concerning users changing gas suppliers, which makes the evaluation of competition on the market rather difficult.

The internal gas market is still too segmented. In order to remedy this segmentation priority should be given to action on the integration of markets, as well as the development of infrastructures and cross-border trade. Finally, it is highly recommended that price regulation be abandoned which hampers competition and dissuades other potential suppliers from entering the market.

Proposal for a Directive of the European Parliament and of the Council of 19 September 2007 amending Directive 2003/55/EC concerning common rules for the internal market in natural gas [COM(2007) 529 final – Not published in the Official Journal].
A third and final legislative package is proposed to complete opening of the European energy markets to competition and creation of the internal energy market.

The internal energy market demonstrates malfunctioning that cannot be corrected effectively by current rules, as stated by the Commission in its sector inquiry. The proposals of the third legislative package go in the same direction as the communication on the prospects for the internal gas and electricity market, and relate to:

the separation of production and supply activities from transmission system operation, either based on ownership unbundling (a single company could no longer own the transmission system at the same time as carrying out energy production or supply activities) or on an independent system operator (vertically integrated companies could retain ownership of the network on the condition that it is actually managed by a completely independent company or body), and provisions specify that non-European operators should meet these separation requirements if they wish to acquire a significant share in a European system;
the increased powers and the independence of national regulators as well as their cooperation through the setting up of a cooperation agency of the energy regulators authorised to make binding decisions and impose penalties;
formalisation of the European groups of transmission system operators for better coordination and, in particular, the drawing-up of joint market and technical codes;
improved market operation, notably greater transparency, effective access to storage facilities and LNG terminals.

The Commission proposes five drafts to amend Directives 2003/54/EC and 2003/55/EC relating to the electricity market and the gas market respectively, as well as Regulations (EC) No 1228/2003 and No 1775/2005 on access to the electricity networks and access to the gas networks respectively, and to set up an energy regulators cooperation agency.
Codecision procedure (COD/2007/0196)

Communication from the Commission to the Council and the European Parliament of 10 January 2007 entitled “Prospects for the internal gas and electricity market ” [COM(2006) 841 final – Not published in the Official Journal].

Communication from the Commission of 10 January 2007 entitled “Inquiry pursuant to Article 17 of Regulation (EC) No 1/2003 into the European gas and electricity sectors (final report)” [COM(2006) 851 final – Not published in the Official Journal].

Regulation (EC) No 1775/2005of the European Parliament and of the Council of 28 September 2005 on conditions for access to the natural gas transmission networks conditions for access to the natural gas transmission networks [Official Journal L 289, 3.11.2007].

Commission Decision 2003/796/EC of 11 November 2003 on establishing the European Regulators Group for Electricity and Gas [Official Journal L 296, 14.11.2003].

Conditions for access to the gas transmission networks

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Conditions for access to the gas transmission networks

Outline of the Community (European Union) legislation about Conditions for access to the gas transmission networks

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Energy > Internal energy market

Conditions for access to the gas transmission networks

Document or Iniciative

Regulation (EC) No 1775/2005 of the European Parliament and of the Council of 28 September 2005 on conditions for access to the natural gas transmission networks.

Summary

Provisions relating to the conditions for access to the natural gas transmission networks add to the provisions of Directive 2003/55/EC and contribute to completion of the internal gas market.

Complete opening-up of national gas markets, as provided for by Directive 2003/55/EC, has brought about a truly competitive internal gas market within the European Union (EU). In practice, industrial clients and domestic customers have had the freedom to choose their gas supplier since 1 July 2004 and 1 July 2007 respectively.

Effective and non-discriminatory access by third parties to the gas transmission networks is an essential condition for the existence of a genuine internal gas market. With the aim of ensuring a minimum level of harmonisation, Regulation (EC) No 1775/2005 therefore lays down the basic principles.

Service conditions for third-party network access

Gas transmission system operators are obliged to offer their services to all users on a non-discriminatory basis. They must therefore offer the same service to different users under identical contractual conditions (nature, duration, etc.). The operator can choose to draw up harmonised transmission contracts or a joint system code.

This does not mean, however, that other transmission system operators are obliged to offer the same contractual conditions, apart from the minimum contractual requirements.

Capacity allocation mechanisms and balancing rules

The system operator makes the technical network capacity available to users in its entirety, taking into account system integrity and efficient use of the network. Capacity allocation is performed on the basis of non-discriminatory and transparent mechanisms.

Different rules, both technical and commercial, allow balancing of the network and guarantee its smooth operation.

Therefore, in the event of contractual congestion, i.e. when the level of demand for firm capacity (transmission capacity which the operator has guaranteed by way of a non-interruptible contract) exceeds the system’s technical capacity, the operator may offer the unused capacity of certain users to other users on a short-term basis.

As for users, they have the freedom to freely trade their capacity rights, by selling or subletting their unused capacity. This trade is an essential factor in the development of a competitive internal market and creation of market liquidity.

The transmission system operator also sets fair and transparent technical balancing rules. In order to guarantee continuity of the gas supply, it must in fact ensure that the system pressure is constantly maintained at a certain level, which depends on the balance between the entry and exit of gas in the network. It provides users with relevant information on the balancing status and they then take the necessary corrective measures.

Criteria and methodologies for setting network access tariffs

Tariffs set by system operators are transparent and non-discriminatory. They reflect the actual costs borne by them.

The prices take into account not only maintenance of system integrity (guarantee of gas transmission from a technical point of view, in particular in relation to gas pressure and quality) but also its improvement (investment incentives and construction of new infrastructures).

Definition of the technical information needed by users and transparency requirements

To encourage effective access to the network, users must have relevant information, particularly on the services offered by the operator, and more specifically the methodology of tariffs, as well as on the technical capacity and available capacity. Users can also use the different commercial possibilities offered by the internal market. System operators publish this information with regard for the confidentiality of commercial information.

Background

The gas regulatory forum, or ” Madrid Forum “, a discussion group for concrete implementation of European regulations in the natural gas market, has enabled definition of guidelines relating to market access conditions. The experience gained from implementation has shown that it is useful to turn these guidelines into legally binding rules.

References

Act	Entry into force – Date of expiry	Deadline for transposition in the Member States	Official Journal
Regulation (EC) No 1775/2005	23.11.2005	–	OJ L 289, 3.11.2005

Related Acts

Proposal for a Regulation of the European Parliament and of the Council of 19 September 2007 amending Regulation (EC) No 1775/2005 concerning conditions for access to the natural gas transmission networks [COM(2007) 532 final – Not published in the Official Journal].

A third and final legislative package is proposed to complete the opening-up of the European energy markets to competition and creation of the internal energy market.

formalisation of the European groups of transmission system operators for better coordination and, in particular, the drawing-up of joint market and technical codes;
improved market operation, in particular greater transparency, effective access to storage facilities and liquefied natural gas (LNG) terminals.

Codecision procedure (COD/2007/0196)

Commission Decision 2003/796/EC of 11 November 2003 on establishing the European Regulators Group for Electricity and Gas [Official Journal L 296, 14.11.2003].

Directive 2003/55/EC of the European Parliament and of the Council of 26 June 2003 concerning common rules for the internal market in natural gas and repealing Directive 98/30/EC [Official Journal L 176, 15.7.2003].

Natural gas transmission networks

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Natural gas transmission networks

Outline of the Community (European Union) legislation about Natural gas transmission networks

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Energy > Internal energy market

Natural gas transmission networks (from 2011)

Document or Iniciative

Regulation (EC) No 715/2009 of the European Parliament and of the Council of 13 July 2009 on conditions for access to the natural gas transmission networks and repealing Regulation (EC) No 1775/2005 (Text with EEA relevance).

Summary

This Regulation aims at laying down rules for natural gas transmission networks, gas storage and liquefied natural gas (LNG) facilities. It concerns access to infrastructures, particularly by determining the establishment of tariffs (solely for access to networks), services to be offered, allocation of capacity, transparency and balancing of the network.

Certification of transmission system operators

National regulatory authorities shall send the European Commission notification of decisions relating to the certification of a transmission system operator. The Commission then has a period of two months to deliver its opinion to the national regulatory authority. The authority then adopts the final decision concerning the certification of the transmission system operator. This decision and the Commission’s opinion are published.

European Network of Transmission System Operators (ENTSO) for gas

Creation of the ENTSO for Gas

By 3 March 2011, the transmission system operators for gas shall submit to the Commission and to the Agency for the Cooperation of Energy Regulators the draft statutes for the ENTSO for Gas, a list of members and draft rules of procedure.

Tasks of the ENTSO for Gas concerning network codes

The Commission shall consult the Agency for the Cooperation of Energy Regulators and the ENTSO for Gas in order to establish an annual list of the priorities which are to contribute to developing network codes. These codes shall be developed using a non-binding framework guideline submitted to the Commission by the Agency. The codes include rules and procedures relating in particular to:

network security and reliability;
data interchange;
technical and operational exchanges;
transparency rules;
harmonised transmission tariff structures;
energy efficiency.

Tasks of the ENTSO for Gas

The ENTSO for Gas is responsible for adopting:

common network operation tools;
a ten-year network development plan;
recommendations relating to the coordination of technical cooperation between Community transmission system operators;
an annual work programme;
an annual report;
annual summer and winter supply outlooks.

Costs and tariffs

The regulatory authorities shall determine tariffs or methodologies for their calculation. Member States may take decisions relating to tariffs such as fixing auction arrangements.

Third-party access services

Transmission system operators shall offer their services equitably to all network users on a rolling basis in the long and short term.

LNG and storage facility operators must also offer their services according to the procedure described above and make them compatible with the use of interconnected gas transport networks.

Allocation of capacity and congestion management

All market participants must have access to maximum network capacity as well as storage and LNG facilities.

Infrastructure operators shall implement and publish non-discriminatory and transparent congestion-management procedures which facilitate cross-border exchanges in gas on a non-discriminatory basis.

This Regulation repeals Regulation (EC) No 1775/2005 as from 3 March 2011.

Context

The 2002 and 2003 European Gas Regulatory Forums (the Madrid Forums) were at the origin of guidelines on best practice. However, experience acquired has demonstrated that these guidelines should be made legally enforceable. This Regulation is based on the guidelines in order to strengthen the internal market in natural gas.

References

Act	Entry into force	Deadline for transposition in the Member States	Official Journal
Regulation (EC) No 715/2009	3.9.2009	–	OJ L211 of 14.8.2009

Internal market in gas

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Internal market in gas

Outline of the Community (European Union) legislation about Internal market in gas

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Energy > Internal energy market

Internal market in gas (from March 2011)

Document or Iniciative

Directive 2009/73/EC of the European Parliament and of the Council of 13 July 2009 concerning common rules for the internal market in natural gas and repealing Directive 2003/55/EC (Text with EEA relevance).

Summary

This Directive aims at introducing common rules for the transmission, distribution, supply and storage of natural gas. It concerns mainly natural gas, liquefied natural gas (LNG), biogas and gas from biomass.

Rules for the organisation of the sector

The rules for the organisation of the sector are aimed at creating a competitive, secure and environmentally sustainable market in natural gas.

Member States may impose on undertakings operating in the gas sector public service obligations which cover issues of security and security of supply, regularity and quality of service, price, environmental protection and energy efficiency.

Member States shall ensure that all customers have the right to choose their gas supplier and to change supplier easily, with their operator’s assistance, within three weeks. They shall also ensure that customers receive relevant consumption data.

Member States are responsible for monitoring security of supply issues and in particular those related to the balance of supply and demand on the national market, available supplies, maintenance of the networks and the measures to be taken in the event of supply problems. Regional or international cooperation may be put in place to ensure security of supply.

Member States shall ensure the integration of national markets at one or more regional levels, as a first step towards the integration of a fully liberalised internal market. The gas islands in isolated regions shall also be integrated. In this context, the national regulatory authorities shall cooperate with the Agency for the Cooperation of Energy Regulators.

Transmission, storage and LNG

From 3 March 2012, Member States shall unbundle transmission systems and transmission system operators.

An undertaking must first be certified before being officially designated as a transmission system operator. A list of transmission system operators designated by Member States shall then be published in the Official Journal of the European Union.

In addition, Member States shall designate one or more storage and LNG system operators responsible for:

operating, maintaining and developing transmission systems, storage and/or LNG facilities with due regard to the environment;
ensuring non-discrimination between system users;
providing information to any other transmission system operator, any other storage system operator, any other LNG system operator and/or any distribution system operator to ensure the interconnection of the transmission and storage of natural gas;
providing system users with the information they need to access the system.

Transmission system operators shall build sufficient cross-border capacity to integrate the European transmission infrastructure. Every year, they shall submit to the regulatory authority a ten-year network development plan indicating the main infrastructure that needs to be built or modernised as well as the investments to be executed over the next ten years.

Distribution and supply

Member States shall designate distribution system operators or require undertakings which own or are responsible for distribution systems to do so.

Distribution system operators are mainly responsible for:

ensuring the long-term capacity of the system in terms of the distribution of gas, operation, maintenance, development and environmental protection;
ensuring transparency with respect to system users;
providing system users with information;
covering energy losses and maintaining reserve capacity.

The distribution system operator shall be independent in legal terms from other activities not relating to distribution.

Distribution systems responsible for distributing natural gas within a geographically confined industrial, commercial or shared services site may be classified by the competent authorities as closed distribution systems. On this basis, they may be exempted from the requirement to have their tariffs, or the methodologies underlying their calculation, approved in advance.

Unbundling and transparency of accounts

Member States and the competent authorities shall have right of access to the accounts of natural gas undertakings but shall preserve the confidentiality of certain information.

Natural gas undertakings shall keep separate accounts for all of their activities relating to the supply of gas, such as transmission and distribution.

Organisation of access to the system

Member States or the competent regulatory authorities shall define the conditions for access to storage facilities and linepack. They shall take measures to ensure that eligible customers can obtain access to upstream pipeline networks. Moreover, they shall organise a system of third party access to transmission and distribution systems.

Natural gas undertakings may refuse access to the system on the basis of lack of capacity or where access to the system would compromise the performance of their public service obligations. Substantiated reasons shall be given for any such a refusal.

Final provisions

A Member State may take the necessary safeguard measures in the event of a sudden crisis in the market or where the safety of persons is threatened. These measures shall be notified to the other Member States and to the Commission.

This Directive repeals Directive 2003/55/EC as from 3 March 2011.

Context

The 2007 Commission Communications entitled “Prospects for the internal gas and electricity market” and “Sector inquiry into the gas and electricity markets” highlighted the inadequacy of the rules and measures in force relating to the internal market in gas in meeting the objectives laid down for the proper functioning of the internal market. The adoption of new rules was required.

REFERENCES

Act	Entry into force	Deadline for transposition in the Member States	Official Journal
Directive 2009/73/EC	3.9.2009	3.3.2011	OJ L211 of 14.8.2009

Information on investment projects in energy infrastructure

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Information on investment projects in energy infrastructure

Outline of the Community (European Union) legislation about Information on investment projects in energy infrastructure

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Energy > European energy policy

Information on investment projects in energy infrastructure

Document or Iniciative

Council Regulation (EU, Euratom) No 617/2010 of 24 June 2010 concerning the notification to the Commission of investment projects in energy infrastructure within the European Union and repealing Regulation (EC) No 736/96.

Summary

This Regulation defines a common framework for the notification to the European Commission of information relating to investment projects * in energy infrastructure *.

Sectors and types of investment projects concerned

This Regulation applies to energy infrastructure in the following sectors:

oil (refining, transport and storage);
natural gas (transmission, LNG terminals and storage);
electricity (production and transmission);
biofuel (production);
carbon dioxide (transport and storage).

Notification of information to the Commission

In the case of infrastructure which is planned or under construction, the following data shall be notified to the Commission:

the volume of the capacities planned or under construction;
the type and main characteristics of infrastructure or capacities planned or under construction;
the probable year of commissioning;
the energy source used;
the installations capable of responding to security of supply crises;
the equipment of carbon capture systems.

With regard to decommissioning, the Commission shall receive information on the character and the capacity of the infrastructure concerned, and the probable year of decommissioning.

Member States shall collect this data from the undertakings which make the investments concerned or by any other equivalent means. Member States shall notify the Commission of this data in aggregated form by 31 July of the reporting year. The first reporting year shall be 2011 and from then onwards every two years. This task may be delegated to a specific body *.

Member States may present estimated or preliminary information on investment projects for infrastructure falling within the scope of the Regulation if the work is scheduled to start within five years or for which decommissioning is scheduled within three years.

When this data is communicated, Member States shall ensure the quality, relevance, accuracy, clarity, timeliness and coherence thereof.

The Commission’s role

The Commission shall prepare an analysis of investment projects and development perspectives for the European energy system based on the data received. It shall discuss this analysis with interested parties such as the European Network of Transmission System Operators (ENTSO) for electricity, the ENTSO for gas, the Gas Coordination Group, and the Oil Supply Group. The Commission shall present the analysis to the Council, the European Parliament and the Economic and Social Committee, and shall publish its report.

The Commission may publish the data that it receives within the limits of personal data protection by virtue of Directive 95/46/EC and on condition that no confidential or sensitive information concerning an undertaking or installation is divulged.

This regulation repeals Regulation (EC) No 736/96.

Key terms of the Act
Investment projects: projects aiming at building new infrastructure, transforming, modernising, increasing or reducing capacities of existing infrastructure, partial or total decommissioning of existing infrastructure. Infrastructure: any type of installations or part of installations related to production, transmission and storage. Specific body: a body entrusted with the preparation and adoption of Union-wide multi-annual network development and investment plans in energy infrastructure.

Key terms of the Act

Investment projects: projects aiming at building new infrastructure, transforming, modernising, increasing or reducing capacities of existing infrastructure, partial or total decommissioning of existing infrastructure.
Infrastructure: any type of installations or part of installations related to production, transmission and storage.
Specific body: a body entrusted with the preparation and adoption of Union-wide multi-annual network development and investment plans in energy infrastructure.

Reference

Act	Entry into force	Deadline for transposition in the Member States	Official Journal
Regulation (EU, Euratom) No 617/2010	4.8.2010	–	OJ L 180 of 15.7.2010

Related Acts

Commission Regulation (EU, Euratom) No 833/2010 of 21 September 2010 implementing Council Regulation (EU, Euratom) No 617/2010 concerning the notification to the Commission of investment projects in energy infrastructure within the European Union.
This Regulation indicates how Member States are to notify the European Commission of information on investment projects in the field of energy. It repeals Regulation (EC) No 2386/96.

Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions of 17 November 2010 – Energy infrastructure priorities for 2020 and beyond – A Blueprint for an integrated European energy network [COM(2010) 677 final – Not published in the Official Journal].

This Communication stresses the need to implement a new European energy infrastructure policy in order to achieve the objectives laid down by the Energy 2020 strategy.
By 2020, the European Commission believes that nearly one trillion euros will have to be invested in the European energy system, 200 billion of which will have to be devoted to energy transmission networks alone. Although the costs of these investments are huge, it would be more expensive not to carry them out because national solutions would be 20% more expensive.
In the longer term, the Commission wishes to introduce networks of the future comprising European Electricity Highways and European CO2 transport infrastructure. To accelerate the introduction of these projects, permit granting procedures should be made faster and more transparent, and a stable framework for financing should be created. The Commission therefore intends to propose new tools combining existing financial mechanisms with other innovations.

Security of supply of natural gas

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Security of supply of natural gas

Outline of the Community (European Union) legislation about Security of supply of natural gas

Topics

These categories group together and put in context the legislative and non-legislative initiatives which deal with the same topic.

Energy > Security of supply external dimension and enlargement

Security of supply of natural gas

Gas consumption in Europe has rapidly increased during the last 10 years. With decreasing domestic production, gas imports have increased even more rapidly, thus creating higher import dependence and the need to address security of gas supply aspects.

Document or Iniciative

Regulation (EU) No 994/2010 concerning measures to safeguard security of gas supply and repealing Council Directive 2004/67/EC (Text with EEA relevance).

Summary

The regulation aims to safeguard the security of gas supply by ensuring both prevention and a coordinated response in the event of a supply disruption and by securing the proper and continuous functioning of the internal gas market.

The regulation establishes a common framework where the security of supply is a shared responsibility of natural gas undertakings, European Union (EU) countries and the Commission. It also provides transparent mechanism, in a spirit of solidarity, for a coordinated response to an emergency at national, regional and EU levels.

Security of supply for protected customers

The regulation sets out a common concept of the customers whose gas supplies have to be protected. All households are protected customers. EU countries may also include as protected customers small and medium-sized enterprises and essential social services (provided that these additional customers do not represent more that 20% of the final use of gas) and/or district heating installations.

Common infrastructure and supply standards

The regulation provides common standards at EU level.

Infrastructure standard: EU countries must ensure that by 3 December 2014 at the latest, in the event of a disruption of the single largest infrastructure, they are able to satisfy total gas demand during a day of exceptional high gas demand. The regulation also requires reverse flows to be established in all cross border interconnections between EU countries by 3 December 2013.
Supply standard for protected customers: Natural gas undertakings must secure supplies to protected customers under severe conditions: in the event of a seven day temperature peak and for at least 30 days of high demand, as well as in the case of an infrastructure disruption under normal winter conditions.

Risk assessment, preventive action plan and emergency plan

By 3 December 2011, the competent authority shall make a full assessment of the risks affecting the security of gas supply. The risk assessment shall take into account the supply and infrastructure standards, all relevant national and regional circumstances, various scenarios of exceptionally high gas demand and supply disruption and the interaction and correlation of risks with other EU countries.

On the basis of the results of the risk assessment, no later than 3 December 2012, the competent authority shall adopt, make public and notify the Commission of a preventive action plan, containing the measures needed to remove or mitigate the risk identified, and an emergency plan containing the measures to be taken to remove or mitigate the impact of a gas supply disruption.

The risk assessment and the plans shall be updated every 2 years.

The Commission shall assess those plans in consultation with the Gas Coordination Group.

EU and regional emergency

The regulation defines three main crisis levels: early warning level, alert level, and emergency level.

The emergency plan shall build upon these crisis levels.

The Commission plays an important role with regard to the declaration of EU or regional emergency. The Commission may declare an EU or a regional emergency at the request of a competent authority that has declared an emergency. When the request comes from at least two competent authorities, the Commission shall declare an EU or regional emergency.

The Gas Coordination Group

The Gas Coordination Group is established to facilitate the coordination of measures concerning security of gas supply. The Group shall be consulted and shall assist the Commission on security of gas supply issues.

The Group shall be composed of representatives of the EU countries, in particular of their competent authorities, as well as the Agency for the Cooperation of Energy Regulators, the European Network of Transmission System Operators (ENTSO) for gas and representative bodies of the industry concerned and those of relevant customers. The Commission shall chair the Group.

Transparency and information exchange:

During an emergency, the natural gas undertakings concerned shall make available certain information to the competent authority on a daily basis.
In the event of an EU or regional emergency, the Commission is entitled to request that the competent authority provides at least information on the measures planned to be undertaken and already implemented to mitigate the emergency.

By 3 December 2011 at the latest EU countries shall inform the Commission of existing inter-governmental agreements concluded with non-EU countries. EU countries must also notify the Commission when any new such agreements are concluded.

Background

The Council Directive 2004/67/EC established for the first time a legal framework at EU level to safeguard security of gas supply. The Russian-Ukrainian gas crisis in January 2009 demonstrated that the provisions of the directive and their uneven implementation by the EU countries was not sufficient to prepare for, and to respond to a supply disruption, and there was a clear risk that measures developed unilaterally by the EU countries could jeopardise the functioning of the internal market.

References

Act	Entry into force	Deadline for transposition in the Member States	Official Journal
Regulation (EU) 994/2010	2.12.2010	–	OJ L295 of 12.11.2010