Natural Gas Market (Amendment) Regulations, 2016

L.N. 30 of 2016

REGULATOR FOR ENERGY AND WATER SERVICES ACT

(CAP. 545)

Natural Gas Market (Amendment) Regulations, 2016

IN exercise of the powers conferred by article 37 (1) of the

Regulator for Energy and Water Services Act, the Minister for Energy

and Health, after consultation with the Regulator for Energy and

Water Services, has made the following regulations:-

The title of these regulations is the Natural Gas Market Citation.

(Amendment) Regulations, 2016, and these regulations shall be read

and construed as one with the Natural Gas Market Regulations S.L. 545.12

hereinafter referred to as "the principal regulations".

Regulation 2 of the principal regulations shall be amended Amends

regulation 2 of

as follows

the principal

regulations.

(a)

immediately after the definition "system user"

there shall be added the following new definition

" "transmission" means the transport of natural gas

through a network, which mainly contains high-pressure

pipelines, other than an upstream pipeline network and

other than the part of high-pressure pipelines primarily

used in the context of local distribution of natural gas, with

a view to its delivery to customers, but not including

supply;"; and

(b)

immediately

after

the

new

definition

"transmission" there shall be added the following new

definition

" "transmission system operator" means a natural

or legal person who carries out the function of

transmission and is responsible for operating, ensuring the

maintenance of, and, if necessary, developing the

transmission system in a given area and, where applicable,

its interconnections with other systems, and for ensuring

the long-term ability of the system to meet reasonable

demands for the transport of gas;".

Regulation 7 of the principal regulations shall be amended Amends

regulation 7 of

as follows

the principal

regulations.

(a)

in sub-regulation (2) thereof, for the word

"Regulator" there shall be substituted the words "gas supplier";

and in the Maltese version thereof, for the words "L-Istati

Membri għandhom jiżguraw" there shall be substituted the

words "Il-provditur tal-gass għandu jiżgura"; and

(b)

immediately after sub-regulation (5) thereof, there

shall be added the following new sub-regulations

"(6) In order to promote energy efficiency, the

Regulator shall strongly recommend that natural gas

undertakings optimise the use of gas, for example by

providing energy management services, developing

innovative pricing formulas or introducing intelligent

metering systems or smart grids where appropriate.

(7) The Regulator shall provide a single point of

contact to provide consumers with all necessary

information concerning their rights, current legislation and

the means of dispute settlement available to them in the

event of a dispute. Such contact point may be part of

general consumer information points, where applicable.

(8) The Regulator shall carry out the function of

an energy ombudsman in order to ensure the efficient

treatment of complaints and out-of-court dispute

settlements.

(9) Where a household customer requests the

natural gas supplier to pass on his historic consumption

data and, or premises installation number either to the

household customer or to another natural gas supplier or to

any other third party, the supplier shall comply with that

request free of charge as soon as reasonably practicable;

provided that the customer has either already expressed

consent in the contract with the supplier upon signature

authorising the natural gas supplier to provide access to

other natural gas suppliers or energy service providers or

third parties to his historic consumption data or provides

such written and signed consent when submitting the

request for access to be given to his data.

For the purposes of this sub-regulation "historic

consumption data" means

(a)

except where a household customer

has held his contract for less than twelve months,

the quantity of natural gas

supplied to the

household customer’s premises during the previous

twelve months; or

(b)

where the household customer has

held his contract for less than twelve months, the

quantity of natural gas supplied to the household

customer’s premises during the duration of the

contract.".

Regulation 14 of the principal regulations shall be Substitutes

regulation 14 of

substituted by the following

the principal

regulations.

" Confidentiality

(1)

Without

prejudice

to

for transmission

regulation 20 or any other legal duty to disclose

system operators

information, each transmission, storage and, or

and transmission

system owners.

LNG system operator, and each transmission

system owner, shall preserve the confidentiality

of commercially sensitive information obtained

in the course of carrying out its activities, and

shall prevent information about its own activities

which may be commercially advantageous from

being disclosed in a discriminatory manner. In

particular, it shall not disclose any commercially

sensitive information to the remaining parts of

the undertaking, unless this is necessary for

carrying out a business transaction.

In order to ensure the full respect of

the rules on information unbundling, the

transmission system owner including, in the case

of a combined operator, the distribution system

operator, and the remaining part of the

undertaking shall not use joint services, such as

joint legal services, apart from purely

administrative or IT functions.

(2) Transmission, storage and, or LNG

system operators shall not, in the context of sales

or purchases of natural gas by related

undertakings, misuse commercially sensitive

information obtained from third parties in the

context of providing or negotiating access to the

system. Storage and, or LNG system operators

shall make public information necessary for

effective competition and the efficient

functioning of the market

Provided that such an obligation shall

be without prejudice to preserving the

confidentiality of commercially sensitive

information.".

5. Immediately after regulation 14 of the principal

regulations there shall be added the following new regulation

" Tasks of

(1)

Each transmission, storage

transmission,

and, or LNG system operator shall

storage and, or

(a)

operate, maintain and develop

LNG system

operators.

under economic conditions secure, reliable

and efficient transmission, storage and, or

LNG facilities to secure an open market,

with due regard to the environment, and

ensure adequate means to meet service

obligations;

(b)

refrain from discriminating

between system users or classes of system

users, particularly in favour of its related

undertakings;

(c)

provide

any

other

transmission system operator, any other

storage system operator, any other LNG

system operator and, or any distribution

system operator, sufficient information to

ensure that the transport and storage of

natural gas may take place in a manner

compatible with the secure and efficient

operation of the interconnected system;

and

(d)

provide system users with the

information they need for efficient access

to the system.

(2) Each transmission system operator

shall build sufficient cross-border capacity to

integrate European transmission infrastructure

accommodating all economically reasonable and

technically feasible demands for capacity and

taking into account security of gas supply.

(3) Rules adopted by transmission

system operators for balancing the gas

transmission system shall be objective,

transparent and non-discriminatory, including

rules for the charging of system users of their

networks for energy imbalance. Terms and

conditions, including rules and tariffs, for the

provision of such services by transmission

system operators shall be established pursuant to

a methodology compatible with regulation 29(4)

in a non-discriminatory and cost-reflective way

and shall be published.

(4) The

Regulator

may

require

transmission system operators to comply with

minimum standards for the maintenance and

development of the transmission system,

including interconnection capacity.

(5) Transmission system operators shall

procure the energy they use for the carrying out

of their functions according to transparent, non-

discriminatory and market based procedures.".

6. Sub-regulation (3) of regulation 21 of the principal Amends

regulation 21 of

regulations shall be substituted by the following

the principal

regulations.

"(3)

Natural gas undertakings shall, in their internal

accounting, keep separate accounts for each of their

transmission, distribution, LNG and storage activities as they

would be required to do if the activities in question were carried

out by separate undertakings, with a view to avoiding

discrimination,

cross-subsidisation

and

distortion

of

competition. Natural gas undertakings shall also keep accounts,

which may be consolidated, for other gas activities not relating

to transmission, distribution, LNG and storage. Revenue from

ownership of the transmission or distribution network shall be

specified in the accounts. Where appropriate, natural gas

undertakings shall keep consolidated accounts for other, non-

gas activities. The internal accounts shall include a balance

sheet and a profit and loss account for each activity.".

7. Regulation 23 of the principal regulations shall be Substitutes

regulation 23 of

substituted by the following

the principal

regulations.

B

" Access to

(1)

The owner of a storage

storage.

facility shall publish at least once every year the

main commercial conditions relating to the use

of storage and the grant to another person of a

right to have gas stored in the facility on that

person’s behalf. The storage system operator

shall publish any changes to the published

conditions as soon as they become effective.

(2) The owner of a relevant facility shall

ensure that the conditions which he is required to

publish under sub-regulation (1) do not

discriminate against any applicants or

descriptions of applicants, or any potential

applicants or descriptions of potential

applicants, for a right to have gas stored in the

facility.

(3) Any person who seeks a right to have

gas stored on his behalf in a gas facility shall

submit an application to the owner of such

facility specifying what is being sought.

(4) The application shall, in particular,

specify

(a)

the period during which the

gas is to be stored in the facility;

(b)

the kind of gas to be stored

(which must be of, or similar to, the kind

the facility is designed to store); and

(c)

the quantities of gas to be

stored.

(5) The applicant and the owner of the

storage facility shall negotiate in good faith and

endeavour to reach an agreement on the

application.

(6) If the owner and the applicant do not

reach any such agreement, the applicant may

apply to the Regulator for directions under sub-

regulation (8) which would secure to the

applicant the right to have the gas stored on his

behalf

Provided that the Regulator shall not

entertain an application unless he is satisfied that

the parties have had a reasonable time in which

to negotiate in terms of subsection (5).

(7) Where a person applies to the

Regulator under sub-regulation (6) and the

Regulator is satisfied as mentioned in sub-

regulation (6), the Regulator shall

(a)

decide

whether

the

application is to be adjourned (so as to

enable further negotiations to take place),

considered further or rejected;

(b)

give notice of his decision to

the applicant; and

(c)

in the case of a decision that

the application is to be considered further,

give to the owner of the facility notice that

the application is to be so considered and

an opportunity of being heard on the

matter.

(8) Where,

after

considering

an

application under sub-regulation (6), the

Regulator is satisfied that the giving of

directions under this sub-regulation would not

prejudice the efficient operation of the facility,

or the storage in the facility of -

(a)

the quantities of gas which the

owner of the facility requires or may

reasonably be expected to require to be

stored in the facility, and

(b)

the quantities of gas which

any person who has a right to have gas

stored in the facility is entitled to require to

be so stored in the exercise of that right,

then the Regulator may give such directions to

the owner of the facility.

(9) Directions under sub-regulation (8)

may -

(a)

specify the terms on which the

Regulator considers the owner of the

facility should enter into an agreement

with the applicant for all or any of the

following purposes;

(b)

specify the sums or the

method of determining the sums which the

Regulator considers should be paid by way

of consideration for any such right,

and require the owner, if the applicant pays or

agrees to pay those sums within a period

specified in the directions, to enter into an

agreement with him on the terms so specified.

(10) An owner of a storage facility shall

be entitled to refuse access thereto for any of the

following reasons

(a)

lack of capacity;

(b)

where access to the facility

would prevent the owner from carrying out

any public service obligations undertaken

by him; or

(c)

in the case of take-or-pay

contracts, where the owner would suffer

serious economic and financial difficulties

Provided that refusal on any of the

above grounds shall be duly substantiated by the

owner

Provided further that, in the case of

refusal on the grounds of lack of capacity, the

owner comprehensively proves that such refusal

was made on an objective, transparent and non-

discriminatory basis.".

8. Regulation 24 of the principal regulations shall be

substituted by the following

" Refusal of

Natural gas undertakings may refuse

access.

access to the system on the basis of lack of

capacity or where the access to the system would

prevent them from carrying out the public

service obligations which are assigned to them

or on the basis of serious economic and financial

difficulties with take-or-pay contracts having

regard to the criteria and procedures set out in

regulation 32 and the alternative chosen by the

Regulator in accordance with sub-regulation (1)

of that regulation. Duly substantiated reasons

shall be given for any such refusal.".

9. Regulation 35 of the principal regulations shall be

substituted by the following

" Administrative

(1)

The Regulator may impose an

fines.

administrative fine upon any person who

infringes any provision of these regulations or

who fails to comply with any directive or

decision given by the Regulator in ensuring

compliance with these regulations.

(2) An administrative fine imposed

under sub-regulation (1) shall not exceed one

hundred thousand euro (€100,000) for each

contravention and, or six hundred euro (€600)

for each day of non-compliance, from the date of

the decision given by the Regulator

Provided, however, that in the case of

undertakings (including vertically integrated

undertakings) or a body corporate, a fine of up to

ten per centum (10%) of the total turnover

concerned in the preceding business year may be

imposed even if such fine results in an amount

which exceeds the threshold provided in this

sub-regulation.".

10. Immediately after regulation 35 of the principal Adds new

regulation to the

regulations there shall be added the following new regulation

principal

regulations.

" Administrative

The Administrative Review Tribunal

Review

established by article 5 of the Administrative

Tribunal.

Justice Act shall have jurisdiction to hear and

determine appeals from decisions of the

Regulator made under these regulations.".

B

€0.90