Electricity Gas Transmission in Non-EU Countries

karanovic/nikolic
/Transmission of Electricity
& Transport of Gas in Non-
EU Countries
ELG 3rd Energy Event, Vienna, Austria
Workshop #6: Electricity and Gas Transmission Networks
and Certification
September 2013

karanovic/nikolic
2 ELG 3rd Energy Event / Transmission of Electricity & Transport of Gas in Non-EU Countries
Serbia: Electricity TSO
Company The Public Enterprise for Electric Energy Transmission and
Transmission System Control ''Elektromreža Srbije'' – EMS.
Purpose/focus Transmission of electricity and management of transmission
system (including allocation of cross-border capacities)
License 10 years, granted by the Energy Agency of the Republic of Serbia
Ownership 100% state-owned
Unbundling Unbundled from other energy activities since 2005 (provided that it
temporary acts also as Market Operator); no ownership unbundling
requirements (unlike under 2009/72EC)
Regulation Grid Code issued in 2008 (slightly amended in 2012)
Rates Tariffs for access established on the basis of the Tariff Methodology
issued by the Energy Agency

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Serbia: Electricity TSO
Outstanding issues — Grid Code not in line with the Energy Law.
— Underdeveloped infrastructure.
— Even though the development of new capacities is obligation
of EMS, investors in new generation capacities in practice
bear costs of development .
ELG 3rd Energy Event / Transmission of Electricity & Transport of Gas in Non-EU Countries

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Serbia: Gas TSO
Company SRBIJAGAS YUGOROSGAZ
Public Enterprise for transport,
distribution, storage and trade of
natural gas
Joint Stock Company gas pipeline
system construction, transport and
distribution of natural gas
Ownership 100% state-owned 50% owned by Gazprom, 25% Central
ME Energy and Gas, Vienna and 25%
Srbijagas
License 10 years, granted by the Energy
Agency of the Republic of Serbia
10 years, granted by the Energy Agency
of the Republic of Serbia
Unbundling Legal unbundling not performed
(required)
Legal unbundling not performed
(pending)
Regulation No transport system rules in place No transport system rules in place
Rates Tariffs for access established on the
basis of the Tariff Methodology issued
by the Energy Agency
Tariffs for access established on the
basis of the Tariff Methodology issued
by the Energy Agency

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Serbia: Gas TSO
Outstanding issues — Legal unbundling not performed .
— No transport rules in place.
— Underdeveloped infrastructure.
— Significant losses of Srbijagas.

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Macedonia: Electricity TSO
Company Electricity Transmission System Operator of Macedonia AD – MEPSO
Purpose/focus Transmission of electricity and management of transmission system
(including allocation of cross-border capacities)
Ownership 100% state owned
License 35 years, approved by the Energy Regulatory Commission of the
Republic of Macedonia (ERC)
Unbundling Unbundled since 2005; transmission and distribution SO in vertically
integrated undertakings need to be organised under different legal
entities, however, there are no ownership unbundling requirements
(unlike under the Directive 2009/72/EC)
Regulation Transmission Grid Code, approved by the ERC
Rates Determined by MEPSO, approved by the ERC based on ERC’s tariff
methodologies

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Macedonia: Electricity TSO
Outstanding issues — Grid code to be further harmonized with 2011 Energy Law.
— It is not possible to reserve transmission capacity.

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Macedonia: Gas TSO
Company Joint Stock Company GA-MAAD Skopje
Purpose/focus Operation, management, balancing and long-term development of
the transport system and the quality of delivery of natural gas
License 35 years, approved by the Macedonian ERC
Ownership Co-owned by the Republic of Macedonia and Makpetrol AD Skopje
(ownership is a matter of an on-going court dispute)
Unbundling Account unbundling in place, as required by the 2011 Energy Law;
no ownership unbundling requirements (unlike the Directive
2009/73/EC).
Regulation Transmission Grid Code, approved by the Macedonian ERC
Rates Determined by the ERC based on their tariff methodologies

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Macedonia: Gas TSO
Outstanding issues — Underdeveloped TS and DS in the country.
— Rules to be harmonised with 2011 Energy Law.
— The on-going dispute between the Republic of Macedonia
and Makpetrol AD Skopje regarding the ownership of the gas
transmission pipeline.
— There have been reports that GA-МА AD Skopje’s TSO
licence could be revoked.

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Bosnia and Herzegovina: Electricity TSO
Company Elektroprenos – Elektroprijenos BiH"
a.d. Banja Luka (EPBH) -
Transmission of electricity
Independent System Operator in BH
(ISO BH) - management of electricity
TS
Ownership 58,90% owned by the Federation of
Bosnia and Herzegovina (FBH);
41,10% owned by the Republic of
Srpska (RS)
Owners of ISO BH are both FBH and
RS (no shares, ownership cannot be
transferred)
License Licence for Transmission of
Electricity, 10 year validity
Licence for Independent System
Operator, 7 year validity
Unbundling Since 2006. Transmission and distribution is organized in different entities, no
ownership requirements (unlike under the Directive 2009/72/EC)
Regulation Grid Code adopted by ISO BH and approved by the SERC
Rates Adopted and calculated in accordance with SERC rules

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Bosnia and Herzegovina: Electricity TSO
Outstanding issues Current legal framework on both state and entity level is not
entirely harmonized with EU law and therefore it is not
possible to achieve effective development of wholesale
market.
It is not ensured real independence of SERC.
Despite the fact that both RS and FBH are performed
revision of rates, there are still below the market prices.

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Bosnia and Herzegovina: Gas TSO
Company BH-GAS Ltd. Sarajevo (FBIH) Gas Promet a.d. (RS)
Purpose/focus Production and transport of gas Import, supply and transport of natural
gas (Gas Promet)
Ownership 100% owned by the Government
of FBIH
RS Share Fund 65 %, Zif Aktiva
Invest Fund 16 %, PREF a.d. Banja
Luka 10%, other
Unbundling No ownership unbundling requirements with respect to the TSO and
distribution/supply activities
Regulation Decree on Organisation and
Regulation of Gas
Rules on Work of Natural Gas
Transport Network
Rates The tariff system is still not
introduced
Determined by TSO, approved by
RCERS in accordance with Tariff
Methodology

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Bosnia and Herzegovina: Gas TSO
Outstanding issues Passing gas law in FBiH (in May 2013 the Federal
Government adopted the Draft Law on Gas, which will
supersede the current decree once this law is enacted).
Establishment of an independent regulatory agency for gas.
RS and FBH adopted different rules on market organisation,
unbundling, third party access and market liberalisation.
Additionally these rules are not harmonised with EU Law.
Connecting the gas network of BiH to the systems of the
neighbouring countries in order to provide new routes and
sources of supply.

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Montenegro: Electricity TSO
Company ―Crnogorski elektropenosni sistem‖ AD Podgorica – CGES
Purpose/focus Transmission of electricity and the operation of the transmission
system
License 15 years, granted by the Energy Agency of Montenegro
Ownership State of Montenegro: 55 %; Terna S.p.A. Italy: 22,0889 %; natural
persons: 8,6707; Funds and Companies: 14,2404 %
Unbundling Unbundled since 2010; transmission and distribution SO in
vertically integrated undertakings need to be organised under
different legal entities
Regulation Rules on Functioning of Transmission Grid, approved by the Energy
Agency of Montenegro in 2012
Rates Determined by CGES and approved by the Energy Agency of
Montenegro, based on tariff methodologies prepared by the Energy
Agency.

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Montenegro: Electricity TSO
Outstanding issues Procedural rules are currently not entirely clear as a result of the
failure to harmonise all regulations governing connection to the
grid with the 2010 Energy Law
The connection of power plants to the transmission grid involves
several steps and usually involves significant costs.
Generators usually have to finance the
revitalisation/development of the parts of grid, obtain licences
and approvals from different public bodies, etc.

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Montenegro: Gas TSO
No TSO in Montenegro
Gas TS is not yet developed in Montenegro. There is no infrastructure, nor any
legislation, apart from general rules set out in Energy Law
By-laws are expected to be passed during autumn of 2013. Potential development of
gas TS depends on Southern Stream Project (if Montenegro is to be connected to the
pipeline)

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Russia: Electricity TSO
Company The Federal Grid Company of Unified Energy System (FGC).
Purpose/focus Electricity transmission services provided to the participants of the
wholesale market of electricity and owners of the electrical energy
equipment connected to the unified energy system
License Not subject to licensing (however contracts for providing electricity
transmission services must be concluded only by FGC, in accordance
with law)
Ownership 79,55% is owned by the Russian Federation; 20,45% is owned by the
minority shareholders.
Unbundling Unbundled since 2008
Regulation Rules on non-discrimination access to electricity transmission
services and rendering of such services
Rates Determined by the authorities of constituent territories of the Russian
Federation on the basis of the Resolution of the Russian Government

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Russia: Electricity TSO
Outstanding issues Prices for technological connection to the transmission
system are not fixed and are different in different subjects
(constituent parts) of the Russian Federation. The connection
prices in Moscow are multiply higher compared to other
networks of medium-voltage system (from 6 to 20 kilowatt)
in inner Russia.
In case of insufficiency of power, absence of transforming
substation or electricity transmission lines technical
connection to grid is very time-consuming and complex.
Additional expenses related to building or modernizing of
transforming substations or electricity transmission lines -
are borne by the customer.

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Russia: Gas TSO
Company Russian Joint Stock Company ―Gazprom‖
Purpose/focus Federal Unified Gas Supply System comprised of unified gas
transmission system, regional transmission system, gas distribution
systems and independent organisations.
License No license requirements (gas transport may be carried out only by
the owner of the system - Gazprom).
Ownership 50,002% owned by the Russian Federation, 49,008 % owned by
other shareholders (including private investors).
Unbundling The Unified Gas Supply System is owned by Gazprom, a bundled
vertically integrated company.
Regulation Federal Law On Gas Supply of 1999, Federal law on Natural
Monopolies of 1995.
Rates Established by the Federal Tariff Service, in accordance with
resolutions and methodologies issued by the Russian Government.

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Russia: Gas TSO
Outstanding issues Since Gazprom not only provides gas transport services but
also produces gas, there is conflict of interests (satisfy its
own demand in transport and only in the second place
demand of other gas producers).
Independent organisation may get access to the gas
transmission services only if Gazprom has enough gas
transport capacity (in case of a lack of such capacity, the
services should be provided in the first place to organisation
satisfying public needs; second in the row are organisations
that intend to transport gas for a longer period; services to
other organisation are provided in the third place);
Information about gas transport services is not sufficiently
transparent (it is hard to figure out what is the transport
capacity at a moment).

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Switzerland: Electricity TSO
Company Swissgrid Ltd.
Purpose/focus Transmission of electricity and the operation of the transmission
system
License Unlimited in time. Granted by the Swiss Federal Electricity
Commission (ElCom)
Ownership Axpo Power, Alpiq, Alpiq Suisse, BKW, Axpo Trading, CKW and
other
Unbundling Fully unbundled since 2013. Transmission and distribution SO in
vertically integrated undertakings need to be organized under
different legal entities with independent decision-making
mechanisms
Regulation Swiss Federal Electricity Supply Act (StromVG)
Swiss Federal Electricity Supply Ordinance (StromVV)
Rates Defined by Swissgrid according to legal requirements. Swissgrid
submits the cost calculation on which these tariffs are based to the
Federal Electricity Commission ElCom on an annual basis

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Switzerland: Gas TSO
Company Swissgas AG
Purpose/focus Transports of gas for third parties; provided that this is technically
feasible and if the third party offers an appropriate consideration
License No license requirements
Ownership Gasverbund Mittelland Ltd. (26%), Erdgas Ostschweiz Ltd. (26%),
Gaznat Ltd. (26%), Verband Schweizerische Gasindustrie (16%)
Erdgas Zentralschweiz Ltd. (6%)
Unbundling No ownership unbundling requirements
Regulation Federal Law on Pipeline Installations for the Transport of Liquid or
Gaseous Heating or Motor Fuels, Pipeline Act (RLG)
Rates Rates are determined by the involved parties. There are no specific
principles determined by public law and no regulatory body is
obliged to review or approve the rates.

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Switzerland: Gas TSO
Outstanding issues Access to the grid is regulated legally only in rudiments and
only with regard to the high pressure grid.
The gap was closed by voluntary agreements of the gas
suppliers. In this way, free access to the entire gas grid is
available.

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Albania: Electricity TSO
Company Operatori i Sistemit te Transmetimit SH.A. (OST)
Purpose/focus Public enterprise operating in the transmission of electric power,
power system dispatching and operation of electricity market
License 25 years license on transmission of electricity and the operation of
the transmission system. License issued by the Energy Regulatory
Entity (ERE)
Ownership 100% owned by the Republic of Albania
Unbundling Unbundled since 2004. Transmission and distribution system
operators are organised in two different legal entities, licensed by
the Energy Regulatory Entity (ERE) respectively for their sectors of
operation, in compliance with the European Union requirements
Regulation Transmission Grid Code, approved by ERE
Rates Tariffs proposed by OST and approved by ERE, in accordance with
established methodology

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Albania: Electricity TSO
Outstanding issues Significant costs occur during the connection of power plants
to the transmission grid.
Producers of energy have to finance the revitalization/
development of parts of the grid to be connected to.

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Albania: Gas TSO
Company No Gas TSO in Albania
License No granted license at this point (ERE is authorised to grant license
to future TSO for 30-years period)
Focus/Obligations TSO owns, operates, builds and maintains the transmission system
and assures in accordance with the economic conditions, sufficient
capacities aiming at fulfilling reasonable demand for transmitting of
natural gas in a given territory
Unbundling TSO is set to be independent from other activities which are not
connected with the transmission activity (organizational, decision-
making point and accounting prospective)
Regulation The Gas Law is the main piece of legislation, while there is no
Transmission Network Code approved yet (the Code is to be
proposed by TSO and approved by ERE)
Rates ERE will establish the tariffs applicable to the Gas Market;
balancing tariffs are defined by TSO and approved by ERE

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Albania: Gas TSO
Outstanding issues The Gas Law is relatively new and in a continuous process of
completion and development aiming to create a favourable
climate for investment in this area.
Trans Adriatic Pipeline natural gas pipeline project (starting
in Greece, cross Albania and the Adriatic Sea and come
ashore in southern Italy, allowing gas to flow directly from
the Caspian region to European markets).

Electricity Gas Transmission in Non-EU Countries

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