License Provisions Compliance Control for Economic Activities in the Energy Sector in Ukraine

Transcription

1 Національна комісія, що здійснює державне регулювання у сфері енергетики Regulatory Partnership Program between the National Association of Regulatory Utility Commissioners of U.S. and the National State Commission for Energy Regulation of Ukraine The Ninth Visit in the framework of the Partnership Program License Provisions Compliance Control for Economic Activities in the Energy Sector in Ukraine Mischenko V.P. Deputy Head of the License Control and Territorial Units Division

2 Laws of Ukraine : #877-V of Apr 05, 2007 on Basic Principles of State Supervision (Control) in the Field of of Economic Activity; #575/97-VR of Oct 16, 1997 on the Electric Power Sector; #1775-ІІІ of Jun 01, 2000 on Licensing of Certain Types of Economic Activities; #2467-VI of Jul 08, 2010 on Basics of Functioning of the Natural Gas Market #2633-ІV of Jun 02, 2005 on Thermal Energy Supply; Orders of the Cabinet of Ministers of Ukraine: #835 of Sep 17, 2008 on the Approval of Criteria for the Assessment of Risks Posed by Economic Agents Activity Subject to Licensing by NERC; #1729 of Dec 27, 2001 on the Supply of Natural Gas to Consumers #1312 of Jul 21, 1999 on the Approval of the Provision on Fines Imposed on Economic Agents for Violation of the Electric Power Sector Legislation; #1139 of Jul 19, 2000 on the Approval of the Procedure of Application of Sanctions for Violation of the Electric Power Sector Legislation; Orders of the National Commission for Energy Regulation On the Approval of the Procedure of License Provisions Compliance Control in the Sphere of Economic Activity of Transportation of Oil and Oil Products along Main Pipelines #881 of May 19, 2011 on the Approval of the Procedure of License Provisions Compliance Control in the Sphere of Economic Activity on the Natural Gas Market #882 of May 19, 2011 on the Approval of the Procedure of Control of Licensee Compliance with the Rules and Provisions of Performing Activity Related to Generation, Transmission and Supply of Electricity, Combined Heat and Power Generation, Heat Generation at CHPs and Plants Using Non-Conventional or Renewable Energy Sources

3 In its execution of state supervision (control) and in the limits of its competence as provided for by the law, the state supervision (control) body shall have the right to: - require from the economic agent remedial actions in case of violation of the legislation; - require termination of actions that prevent performance of state supervision (control); - get clarifications, certificates, documents, materials, information on questions arising in the process of state supervision (control) in accordance with the legislation; - impose fines and implement measures as provided for by the legislation

4 Ensured by meeting the requirements of: the Law of Ukraine on Basic Principles of State Supervision (Control) in the Field of of Economic Activity; the Procedures of Control of Licensee Compliance with the Rules and Provisions of Entrepreneurial Activity in the Electric Power and Oil and Gas Sectors; The Regulations of the National State Commission for Energy Regulation.

5 The State supervision (control) body implements scheduled state supervision (control) on the condition of providing a written notification to the economic agent about the scheduled inspection not later than 10 days before the activity (art. 5 para 4 of the Law); For the purpose of scheduled or unscheduled inspection, the state supervision (control) body issues an Order that should state the name of the inspected economic agent and the reason for the inspection (art. 7 para 1 of the Law); Based on the Order, an authorization (direction) document is issued for the activity, which is signed by the head of the state supervision (control) body (indicating the full name) and sealed (art. 7 para 2 of the Law).

6 Before the start of the inspection, the State supervision (control) body officials shall present to the Head of the economic agent or his authorized representative an authorization (direction) document or an official ID identifying the official of the State supervision (control) body and provide the economic with a copy of the authorization document (art 7 para 5 of the Law); Based on the results of the scheduled or unscheduled inspection, in case of finding out violations of the legal requirements, the State supervision (control) body official shall draw up an act (art 7 para 6 of the Law);

7 NERC activity shall be open and transparent, something that is ensured by posting of information on the webpage, publication in mass media (para 1.5 of NERC Regulations approved by NERC Order #1 of Dec 22, 2011); Information on the place, date and time of public meetings and the agenda are posted on the official NERC website not later than 3 days before the meeting (sub-para of the Regulations); Representatives of state bodies, institutions, organizations can be invited to the meeting of the Commission for the purpose of finding all the facts that are important in addressing issues and need special knowledge in respective areas (sub-para of the Regulations); NERC shall drafts invitations or messages about their participation in the NERC meeting for licensees and other interested parties; Decisions (regulatory acts) of state bodies are published in official publications (bulletins, collected books, factsheets) and printed media (Provisions of the Law of Ukraine on the Procedure of Mass Media Coverage of the Public Authorities and Local Governments Activity in Ukraine).

8 Electricity: 1-NERC Report on the use of fuel by licensees in power and heat generation; 2-NERC Reporting data on the amounts of power transmission by local power networks and specified regulatory technological losses for voltage classes 1-2; 3-NERC Report on payment by power suppliers for the use of local power networks; 4-NERC Reporting and estimated data on the useful supply of power according to groups and classes of consumers; 5-NERC Report on consumed power settlement; 6-NERC-energy supply Report on financial results and budget performance of licensable activities; 6-NERC-power generation Report on licensable activity of economic agents producing electric power and heat; 7-NERC Report on settlement for electric power that was bought by suppliers on the Ukrainian wholesale power market and supplied to consumers; 8-NERC Report on settlement for power by the population; 9-NERC Report on current payment for licenses for economic activity in the power and heat sector; 10-NERC Report on losses caused by damage to the equipment of power lines and transformer substations as a result of natural disasters, manmade disasters and wrongful acts by third parties.

9 Gas and oil: 1-NERC-gas Report on amounts of natural gas supplied to consumers by suppliers of natural gas, gas (methane) of coal deposits at a non-regulated rate; 2-NERC-gas Report on settlements made between the licensee and owners of natural gas, gas (methane) of coal deposits and between consumers and the licensee for the consumed natural gas; 3-NERC-gas Report on the amount of natural gas load into the underground gas storage; 4-NERC-gas Reported and estimated data on licensable activity of economic agents on transportation, storage, distribution of natural gas and its supply at the non-regulated rate, 4-NERC-oil Reported and estimated data on licensable activity of economic agents on transportation of oil along main pipelines, 4-NERC-oil products Reported and estimated data on licensable activity of economic agents on transportation of oil products along main pipelines; 5-NERC-gas Report on the status of settlements for natural gas; 6-NERC-gas Report on the amount of natural gas in underground gas storages 7-NERC-gas Report on receipt of payments from consumers for natural gas and allocation of funds according to the algorithm

10 The frequency of scheduled inspections for big licensees once in a (1) year; for small once in two (2) years; Scheduled inspection in the energy sector shall not exceed 15 days, in the oil and gas sector 15 with a possibility of extension up to 30 days; The lists of issues for scheduled inspections are approved for each type of licensed activity by NERC Decision registered by the Ministry of Justice of Ukraine and posted on the NERC s website A general list of basic issues in licensed activity: general issues (presence of an original copy of the license, presence of changes in the constituent documents) for all licensees; analysis of the licensee s financial and economic indicators (compliance to the rate design, investment program, presence of the factors of implementation of crosssubsidies) for licensees which rates are approved by NERC; compliance by the licensees with the legal requirements and NERC decisions; licensee s timely and accurate submission of reporting to NERC, including on supply reliability indicators and indicators of merchantable quality of services provided

11 Grounds for unscheduled activities (article 6 of the Law): - licensee s written request; - finding of invalid data in mandatory reporting documents; - control of licensee s execution of NERC orders or other documents related to remedial actions to eliminate violations of legal requirements that were issued based on scheduled inspections; - claims received from individuals and legal entities on violations of legal requirements to economic activity; - licensee s failure to ensure timely submission of mandatory reporting without valid reasons; Scheduled activities shall only address issues that served as grounds for the inspection with obligatory specification of these issues in the authorization (direction) document prescribing the state supervision (control) (art. 6 of the Law). The term of unscheduled activity shall not exceed ten business days, two business days for small economic agents.

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13 - for licensees performing their economic activity on the natural gas market in the amount of up to fifty thousand personal exemptions of citizens (art. 23 of the Law of Ukraine on Basics of Functioning of the Natural Gas Market) up to 850 thousand UAH, - for licensees performing economic activity of transportation of oil and oil products along main pipelines - in the amount of five thousand personal exemptions of citizens (art. 17 of the Law of Ukraine on Natural Monopolies) up to 85 thousand UAH, - for violations in the power sector in the amount of up to five thousand personal exemptions of citizens (art. 27 of the Law of Ukraine on the Energy Sector up to 85 thousand UAH.

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15 Licensee s non-compliance with the rate design approved by NERC; Non-compliance with investment programs; Violation of legal requirements and NERC decisions; Providing invalid reporting to NERC; Improper settlements with the Wholesale power market (in the electricity sector); Non-compliance with the requirements to types of activities other than licensable; Incomplete fulfillment of financial obligations related to timely payment for gas, payment for services of transportation along main pipelines of natural and oil gas under existing agreements; Failure to publish information on inspections of gas quality parameters in mass media; Non-compliance with standards established by NERC on sufficiency of capital adequacy and other indicators (requirements) that limit transaction risks on the power and gas market (for licensees of natural gas or power at non-regulated rates); Licensees failure to submit documents that are necessary for the inspection and ensure conditions for the inspection.

16 Thank you for your attention!