***I DRAFT REPORT. EN United in diversity EN 2009/0108(COD)

Transcription

1 EUROPEAN PARLIAMT Committee on Industry, Research and Energy /0108(COD) ***I DRAFT REPORT on the proposal for a regulation of the European Parliament and of the Council concerning measures to safeguard security of gas supply and repealing Directive 2004/67/EC (COM(2009)0363 C7-0097/ /0108(COD)) Committee on Industry, Research and Energy Rapporteur: Alejo Vidal-Quadras PR\ doc PE v01-00 United in diversity

2 PR_COD_1am Symbols for procedures * Consultation procedure majority of the votes cast **I Cooperation procedure (first reading) majority of the votes cast **II Cooperation procedure (second reading) majority of the votes cast, to approve the common position majority of Parliament s component Members, to reject or amend the common position *** Assent procedure majority of Parliament s component Members except in cases covered by Articles 105, 107, 161 and 300 of the EC Treaty and Article 7 of the EU Treaty ***I Codecision procedure (first reading) majority of the votes cast ***II Codecision procedure (second reading) majority of the votes cast, to approve the common position majority of Parliament s component Members, to reject or amend the common position ***III Codecision procedure (third reading) majority of the votes cast, to approve the joint text (The type of procedure depends on the legal basis proposed by the Commission.) s to a legislative text In amendments by Parliament, amended text is highlighted in bold italics. In the case of amending acts, passages in an existing provision that the Commission has left unchanged, but that Parliament wishes to amend, are highlighted in bold. Any deletions that Parliament wishes to make in passages of this kind are indicated thus: [...]. Highlighting in normal italics is an indication for the relevant departments showing parts of the legislative text for which a correction is proposed, to assist preparation of the final text (for instance, obvious errors or omissions in a given language version). Suggested corrections of this kind are subject to the agreement of the departments concerned. PE v /33 PR\ doc

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5 DRAFT EUROPEAN PARLIAMT LEGISLATIVE RESOLUTION on the proposal for a regulation of the European Parliament and of the Council concerning measures to safeguard security of gas supply and repealing Directive 2004/67/EC (COM(2009)0363 C7-0097/ /0108(COD)) (Codecision procedure: first reading) The European Parliament, having regard to the Commission proposal to the European Parliament and the Council (COM(2009)0363), having regard to Article 251(2) and Article 95 of the EC Treaty, pursuant to which the Commission submitted the proposal to Parliament (C7-0097/2009), having regard to Rule 55 of its Rules of Procedure, having regard to the report of the Committee on Industry, Research and Energy and the opinions of the Committee on Economic and Monetary Affairs, the Committee on Foreign Affairs, the Committee on the Environment, Public Health and Food Safety and the Committee on the Internal Market and Consumer Protection (A7-0000/2009), 1. Approves the Commission proposal as amended; 2. Calls on the Commission to refer the matter to Parliament again if it intends to amend the proposal substantially or replace it with another text; 3. Instructs its President to forward its position to the Council and the Commission. 1 Recital 5 (5) Gas routes and sources for the Community should support the security of supply of the Community as a whole and its Member States individually. Security of supply will depend in the future on the evolution of the fuel mix, the development of production in the Community and in third countries supplying the Community, investments in storage facilities and in routes within and outside the Community including Liquefied Natural Gas facilities. (5) The diversification of gas routes and sources for the Community is essential to improve the security of supply of the Community as a whole and its Member States individually. Security of supply will depend in the future on the evolution of the fuel mix, the development of production in the Community and in third countries supplying the Community, investments in storage facilities and in the diversification of routes and sources of supply within and outside the Community including PR\ doc 5/33 PE v01-00

6 Liquefied Natural Gas facilities. For these reasons it is necessary to adopt measures that promote such diversification in the long term. 2 Recital 10 a (new) (10a) The construction of new crossborder infrastructures necessary to achieve the objective of at least 10% of electricity and gas interconnection capacity by 2010 as requested in the Presidency conclusions of March 2007 should be prioritised. 3 Recital 10 b (new) (10b) It is important to establish prior agreements between the interconnected systems regarding balancing and supply so that, in emergency situations, optimal use of the available interconnections is guaranteed. PE v /33 PR\ doc

7 4 Recital 16 (16) Sufficiently harmonised security of supply standards covering at least the situation that occurred in January 2009, taking into account the difference between Member States, should be defined, without imposing unreasonable and disproportionate burdens on natural gas undertakings including new entrants and small undertakings. (16) Sufficiently harmonised security of supply standards covering at least the situation that occurred in January 2009, taking into account the difference between Member States, should be defined, without imposing unreasonable and disproportionate burdens on natural gas undertakings, including new entrants and small undertakings, and on end users. Big end-users have a substantial ability to contribute to addressing emergency situations, i.e. through their switching capabilities. Such potential contribution should equally not be burdened. 5 Recital 20 (20) The security of supply aspects of longterm planning of investments in sufficient cross-border capacities and other infrastructures, ensuring the long-term ability of the system to guarantee security of supply and meet reasonable demands, are addressed by Directive.../ /EC of the European Parliament and of the Council [concerning common rules for the internal market in natural gas and repealing Directive 2003/55/EC]. Meeting the security of supply standards may require a transitional period to allow the necessary investments to be made. The 10-year network development plan drawn up by the (20) The security of supply aspects of longterm planning of investments in sufficient cross-border capacities and other infrastructures, ensuring the long-term ability of the system to guarantee security of supply and meet reasonable demands, are addressed by 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. Meeting the security of supply standards may require a transitional period to allow the necessary investments to be made. The 10-year network development plan drawn up by the TSO-G and PR\ doc 7/33 PE v01-00

8 TSO-G and supervised by ACER is a fundamental tool to identify the required investments needed at Community level. supervised by ACER is a fundamental tool to identify the required investments needed at Community level in order to implement the infrastructure requirements laid down in this Regulation and to undertake a risk assessment at Community level. 6 Recital 30 (30) Since gas supplies from third countries are central to the security of gas supply of the Community, the Commission should coordinate the actions with regard to third countries, working with producer and transit countries on arrangements to handle crisis situations and to ensure a stable gas flow to the Community. The Commission should be entitled to deploy a task force to monitor gas flows in crisis situations within and, in consultation with the third countries involved, outside the Community and, where a crisis arises due to difficulties in a third country, to assume a mediation and facilitation role. (30) Since gas supplies from third countries are central to the security of gas supply of the Community, the Commission should coordinate emergency actions with regard to third countries, working with producer and transit countries on arrangements to handle crisis situations and to ensure a stable gas flow to the Community. The Commission should be entitled to request the deployment of a task force to monitor gas flows in crisis situations within and, in consultation with the third countries involved, outside the Community and, where a crisis arises due to difficulties in a third country, to assume a mediation and facilitation role. Under normal conditions, coordination with producer countries will be done by undertakings and monitored by Member States. The entitlement of the Commission can only be enforced within the EU. With gas producing countries outside the EU, the Commission should be requesting to deploy the task force. PE v /33 PR\ doc

9 7 Article 1 This Regulation establishes measures aimed at safeguarding the security of gas supply so as to ensure the proper and continuous functioning of the internal market for gas by providing for a clear definition and attribution of responsibilities and for a coordination of the response at the level of the Member States and the Community regarding both preventive action and the reaction to concrete disruptions of supply. This Regulation establishes measures aimed at safeguarding the security of gas supply so as to ensure the proper and continuous functioning of the internal market for gas by providing for a clear definition and attribution of responsibilities and for a coordination of the response at the level of natural gas undertakings, Member States and the Community regarding both preventive action and the reaction to concrete disruptions of supply. 8 Article 2 introductory part For the purpose of this Regulation the definitions of Directive 2009/xxx/EC (the "Gas Directive") and the Regulation 2009/xxx/EC (the "Agency Regulation") shall apply. For the purpose of this Regulation the definitions of Directive 2009/73/EC (the "Gas Directive"), Regulation (EC) No 715/2009 (the "Gas Regulation") and Regulation (EC) No 713/2009 (the "Agency Regulation") shall apply. In order to maintain homogeneity and clarity of definitions, reference should be made also to the Gas Regulation of the 3rd Internal Energy Market package. PR\ doc 9/33 PE v01-00

10 9 Article 3 paragraph 2 2. Each Member State shall designate a Competent Authority responsible for the implementation of the security of gas supply measures provided in this Regulation. The measures shall include the biennial risk assessment, the establishment of the Preventive Action Plans, the establishment of the Emergency Plan, and the continuous monitoring of security of gas supply at national level. Competent Authorities shall cooperate with each other to prevent a supply disruption and to limit damages in case it occurs. 2. Each Member State shall designate on transparent terms an independent Competent Authority responsible for the implementation of the security of gas supply measures provided in this Regulation. The measures shall include the biennial risk assessment, the establishment of the Preventive Action Plans, the establishment of the Emergency Plan, and the continuous monitoring of security of gas supply at national level. Competent Authorities shall cooperate with each other to prevent a supply disruption and to limit damages in case it occurs. Key to the credibility of the national competent authority, and of any measures it proposes, will be that it is free to operate without risk of political interference. 10 Article 3 paragraph 4 4. The Commission shall coordinate the Competent Authorities at the Community level through the Gas Coordination Group in particular in the case of a Community Emergency. 4. The Commission shall coordinate the Competent Authorities at the Community level through the Gas Coordination Group referred to in Article 10 in particular in the case of a Community Emergency and for the evaluation of the measures referred to in paragraph 2. PE v /33 PR\ doc

11 Since the Gas Coordination Group will be involved during an Emergency, it should take part in the preventive stages. 11 Article 3 a (new) Article 3a Long-term security of supply measures At the latest one year after the entry into force of this Regulation, the Commission shall present a report containing proposed regulatory measures that could be implemented in order to diversify, at Community level, the geographical sources of gas and the routes of supply into the EU. The report shall, in particular, include an assessment of the role of LNG installations. There is a need to further develop a long term strategy of security of gas supply at Community level. 12 Article 4 paragraph 1 introductory part 1. By [31 March 2011; 12 months from entry into force] at the latest, the Competent Authority, after consultation of the natural gas undertakings, of the relevant organisations representing the interests of household and industrial customers and of the regulatory authority, 1. By [30 September 2011; 18 months from entry into force] at the latest, the Competent Authority, after consultation of the natural gas undertakings, of the relevant organisations representing the interests of household and industrial customers and of the regulatory authority, PR\ doc 11/33 PE v01-00

12 where it is not the Competent Authority, shall establish: where it is not the Competent Authority, shall establish: The establishment of the plans requires a significant co-ordination effort, particularly in member states or regions with a multitude of bordering member states. An establishment of the plans in just one year would jeopardise comprehensive consultations and effective coordination with neighbouring entities. 13 Article 4 paragraph 2 2. Before adopting those Plans the Competent Authorities shall exchange information and consult each other and the Commission to ensure that their Plans and measures are mutually consistent at the appropriate regional level. These consultations shall cover, as a minimum, interconnections, cross-border supplies, storage across borders and the physical capacity to transport gas in both directions. 2. Before adopting those Plans the Competent Authorities shall exchange information and consult each other and the Commission to ensure that their Plans and measures are mutually consistent at the appropriate regional level. These consultations shall cover, as a minimum, interconnections, cross-border supplies, storage across borders and the physical capacity to transport gas in both directions. The Gas Coordination Group shall be informed of these consultations and their results. Strengthening the role of the Gas Coordination Group is essential to properly addressing crisis. PE v /33 PR\ doc

13 14 Article 4 paragraph 3 3. During the process mentioned in paragraph 2 the Commission may recommend at which regional level the exchange of information and consultations shall take place. The Commission, after consultation of the European Network of Transmission System Operators for Gas ("TSO-G") and the Agency for the Cooperation of Energy Regulators ("ACER"), may also recommend the establishment of a joint Plan at regional level. 3. During the process mentioned in paragraph 2 the Commission may recommend at which regional level the exchange of information and consultations shall take place. The Commission, in cooperation with the European Network of Transmission System Operators for Gas ("TSO-G"), the Agency for the Cooperation of Energy Regulators ("ACER") and the Gas Coordination Group, may also recommend the establishment of a joint Plan at regional level. The Gas Coordination Group, ACER and TSO-G are of utmost importance in the identification of regional areas for cooperation and should be fully involved in this process. 15 Article 4 paragraph 6 subparagraph 1 6. Within six months after the notification of the Plans by the Competent Authorities, the Commission shall assess the Plans of all Member States. The Commission shall consult TSO-G, ACER, the Gas Coordination Group and other concerned stakeholders on those plans. Where the Commission considers that a Plan is not effective to mitigate the risks as identified in the risk assessment or inconsistent with the risk scenarios or the Plans of other Member States, or that it does not comply 6. Within six months after the notification of the Plans by the Competent Authorities, the Commission shall assess the Plans of all Member States. The Commission shall consult TSO-G, ACER, the Gas Coordination Group and other concerned stakeholders on those plans. Where the Commission considers that a Plan is not effective to mitigate the risks as identified in the risk assessment or inconsistent with the risk scenarios or with the Community Plan or the Plans of other Member States, PR\ doc 13/33 PE v01-00

14 with the provisions of this Regulation or other provisions of Community law, it shall require the revision of the Plan. or that it does not comply with the provisions of this Regulation or other provisions of Community law, it shall require the revision of the Plan. A Community Plan should be in place since there is a definition of Community Emergency. 16 Article 5 paragraph 1 introductory part 1. The Preventive Action Plan shall contain: 1. The Preventive Action Plan, at national, regional or Community level, shall contain: A Community Plan should be in place since there is a definition of Community Emergency. Provisions should also be set up in case there are regional plans developed. 17 Article 6 paragraph 1 1. By [31 March 2014; 3 years after entry into force] at the latest, the Competent Authority shall ensure that in the event of a disruption of the largest gas supply infrastructure, the remaining infrastructure (N-1) has the capacity to deliver the necessary volume of gas to satisfy total gas demand of the calculated area during a period of sixty days of exceptionally high gas demand during the coldest period 1. By [31 March 2016; five years after entry into force] at the latest, the Competent Authority shall ensure that in the event of a disruption of the largest gas supply infrastructure, the remaining infrastructure (N-1) has the capacity to deliver the necessary volume of gas to satisfy total gas demand of the calculated area during a period of sixty days of exceptionally high gas demand during the coldest period PE v /33 PR\ doc

15 statistically occurring every twenty years. statistically occurring every twenty years. The 3-year time span to meet the standard as stated in Article 6.1 is not compatible with the timelines for the construction of new infrastructures. In particular, it does not take into account the duration of administrative procedures which result in a timeframe of 5 to 6 years to build a new gas transport infrastructure. 18 Article 6 paragraph 5 5. The transmission system operators shall enable permanent physical capacity to transport gas in both directions on all interconnections within two years from the entry into force of this Regulation, except in cases where at the request of a Competent Authority, the Commission decides that the addition of a bi-directional flow capacity would not enhance the security of supply of any Member State. Such decision may be reviewed if circumstances change. The level of the bidirectional flow capacity shall be reached in a cost efficient way and at least take into account the capacity required to meet the supply standard set in Article 7. Within that two year period, the gas transmission system operator shall adapt the functioning of the transmission system as a whole so as to enable bi-directional gas flows. 5. The transmission system operators shall enable permanent physical capacity to transport gas in both directions on those interconnections within three years from the entry into force of this Regulation, where the addition of a bi-directional flow capacity enhances the security of supply of any Member State. The level of the bidirectional flow capacity shall be reached in a cost efficient way and at least take into account the capacity required to meet the supply standard set in Article 7. Where additional investments are required further down the transmission system, paragraph 7 shall also apply to those investments. The Competent Authorities shall ensure that the assessment of the interconnections is regularly reviewed if circumstances change, in particular through the updating of the national preventive action plan. PR\ doc 15/33 PE v01-00

16 The 2-year time schedule to enable permanent physical capacity to transport gas in both directions on all interconnections can be achieved only in the case of small modifications of infrastructure. When there is the need for larger modifications, for example addition of a compression unit, this is not compatible with the time schedule for the building of the new infrastructures. This article should take into consideration investments required further down in the transmission system. Last sentence is redundant. 19 Article 6 paragraph 7 7. National Regulatory Authorities shall take into account the costs of fulfilling the N-1 standard and the costs of enabling the permanent physical capacity to transport gas in both directions in their approval of tariffs in line with Article 41(8) of Directive [ / EC]. In the case of costs incurred in more than one Member State, the national regulatory authorities of all Member States concerned shall jointly decide on cost allocation. Article 8(1) of Regulation (EC) No / shall apply. 7. National Regulatory Authorities shall introduce appropriate incentives and take into account the costs of fulfilling the N-1 standard and the costs of enabling the permanent physical capacity to transport gas in both directions in their approval of tariffs or their methodologies in line with Article 41(8) of Directive 2009/73EC. In the case of costs incurred in more than one Member State or in one Member State for the benefit of other Member States, the national regulatory authorities of all Member States concerned shall jointly decide on cost allocation before any investment decision is taken. Any such investment decision shall be subject to approval by the national regulatory authority in relation to its costs and the allocation of such costs among all of the national regulatory authorities concerned. The proportion to which each Member State benefits from the investment with regard to security of supply shall be taken into consideration in relation to the allocation of costs among those Member States. Article 8(1) of Regulation (EC) No 715/2009/ shall apply. PE v /33 PR\ doc

17 Incentives should be set up in order to promote investments in infrastructure with an added value in terms of security of supply. The Commission proposal lacks specification regarding proportional costs in situations where the investment is made in the interest of another (or several other) Member States. 20 Article 7 paragraph 2 2. The Competent Authority shall take the measures to ensure the gas supply to the protected customers for the period of sixty days also in the event of an Emergency as defined in Article 9(2). The Competent Authority shall endeavour to maintain the supply for the protected customers as long as necessary. 2. The Competent Authority shall take the appropriate measures to ensure the gas supply to the protected customers for the period of sixty days also in the event of an Emergency as defined in Article 9(2). After sixty days, or under more severe conditions than those defined in paragraph 1, the Competent Authority shall endeavour to maintain as far and as long as possible the supply for the protected customers. The proposed regulation only takes into account one scenario. It has to take into consideration that the base scenario can significantly vary in intensity or length; therefore there must be leverage for the competent authorities to manage a different sort of crisis while recognising there can be some limitations. 21 Article 8 paragraph 1 introductory part 1. By [30 September 2010; 6 months after entry into force] each Competent Authority shall fully assess the risks affecting the security of gas supply in its Member State 1. By [30 September 2010; 6 months after entry into force] the Commission and each Competent Authority shall fully assess the risks affecting the security of gas supply in the EU and in the Member State PR\ doc 17/33 PE v01-00

18 by: respectively by: 22 Article 8 paragraph 1 point b b) taking into account all relevant national and regional circumstances; b) taking into account all relevant national and regional circumstances, including the use of gas to supply electricity and district heating to protected customers; As in several Member States gas is used as a main fuel to generate electricity and also heat, the supply of protected customers with electricity and district heat should also be considered in the risk assessment. 23 Article 9 paragraph 1 point 7 (7) Identify the contribution of the nonmarket based measures planned or to be implemented for the Emergency level listed in Annex III and assess the degree to which the use of non-market based measures is necessary to cope with the crisis, assess their effects and define the procedures to implement them; (7) Identify, on the basis of a transparent cost-benefit analysis, the contribution to and relative merit of the non-market based measures planned or to be implemented for the Emergency level listed in Annex III and assess the degree to which the use of non-market based measures is necessary to cope with the crisis, assess their effects and define the procedures to implement them; non-market based measures shall only be used to ensure security of supply as a last resort. PE v /33 PR\ doc

19 It has to be made very clear that non-market measures should only be used as a last resort. 24 Article 9 paragraph 1 point 10 (10) A list of predefined actions to make gas available in the case of an Emergency, including the compensation mechanisms and commercial agreements between the parties involved in such actions. Such actions may involve cross-border agreements between Member States and/or natural gas undertakings. (10) Establish a list of predefined actions to make gas available in the case of an Emergency. Such actions may involve cross-border agreements between Member States and/or natural gas undertakings. It is understood from the Commission proposal that compensation mechanisms should only be applied for the cost of gas not supplied to gas customers as a consequence of the implementation of an emergency measure. Commercial agreements will already be submitted to the competent authority under Art. 12, there is no need to treat them separately in a "list". 25 Article 9 paragraph 2 point 1 (1) Early warning level (Early Warning): when there is concrete, serious and reliable information, possibly triggered by an Early Warning Mechanism, that an event may occur which will deteriorate the supply conditions; (1) Early warning level (Early Warning): when there is concrete, serious and reliable information, possibly triggered by an Early Warning Mechanism, that an event may occur which will deteriorate the supply conditions; at this level, the market may solve the problem without intervention of the Competent Authority. PR\ doc 19/33 PE v01-00

20 26 Article 9 paragraph 2 point 3 (3) Emergency level (Emergency): when an exceptionally high demand occurs or when there is a disruption of the supply through or from the largest infrastructure or source and there is a credible risk that the supply standard to the protected customers can no longer be met with market based instruments alone. (3) Emergency level (Emergency): when an exceptionally high demand occurs or when there is a disruption of the supply through or from the largest infrastructure or source and there is a credible risk that the supply standard to the protected customers can no longer be met with market based instruments alone and the intervention of the Competent Authority is required within the framework of the Emergency Plan. Market based instruments (at national, regional or community level) shall be given priority to mitigate the effects of the supply disruption, even in an emergency. 27 Article 9 paragraph 3 a (new) 3a. The Emergency Plan shall also identify the necessary measures and actions to be taken in the case of an Emergency to mitigate the impact of disruption in the supply of gas for electricity and district heating to protected customers. PE v /33 PR\ doc

21 As in several Member States gas is used as a main fuel to generate electricity and also heat, the supply of protected customers with electricity and district heat. This should be aimed at ensuring that protected customers do not suffer a blackout due to a gas crisis. 28 Article 9 paragraph 6 a (new) 6a. The Emergency Plan shall be updated every two years. The risk assessment needs to be repeated every two years, accordingly the Preventive Action Plan has to be updated. This amendment adds the corresponding requirement for the Emergency Plan. 29 Article 10 paragraph 1 1. The Commission may declare a Community Emergency at the request of one Competent Authority or when the Community loses more than 10% of its daily gas import from third countries as calculated by TSO-G. It shall declare a Community Emergency where more than one Competent Authority has declared Emergency following the verification in accordance with Article 9(6). It may declare a Community Emergency for specifically affected geographical regions comprising more than one Member State. 1. The Commission shall declare a Community Emergency where more than one Competent Authority has declared an Emergency in accordance with Article 9(6) or when the Community loses more than 10% of its daily gas import from third countries as estimated by TSO-G. It may at the request of a Competent Authority, declare a Community Emergency for specifically affected geographical regions comprising more than one Member State. PR\ doc 21/33 PE v01-00

22 Crisis management at a national/regional level is often more effective in coping with a supply crisis. These thresholds do not necessarily fully reflect possible regional crisis under 10% at EU level where Community intervention would be also needed. 30 Article 10 paragraph 2 2. The Commission shall convene the Gas Coordination Group as soon as it declares Community Emergency. 2. The Commission shall convene the Gas Coordination Group as soon as it declares Community Emergency. In carrying out its work, the Commission and the Gas Coordination group shall take into account: (a) the measures taken by the gas industry as a first response to the major gas disruption; (b) the measures taken by Member States, such as those contained in the prevention and emergency plans. Convening the Gas Coordination group should not be optional. The Commission shall convene it in a Community Emergency to act swiftly. 31 Article 10 paragraph 3 3. In a Community Emergency, the Commission shall coordinate the actions of the Competent Authorities. In particular the Commission shall ensure the exchange of information, ensure the consistency and effectiveness of the actions at Member 3. In a Community Emergency, the Commission shall coordinate the actions of the Competent Authorities through the Gas Coordination Group. In particular the Commission shall ensure the exchange of information, ensure the consistency and PE v /33 PR\ doc

23 State and regional level in relation to the Community level, and shall coordinate the actions with regard to third countries. The Commission may convene a crisis management group composed in particular of representatives of the industry and the Member States concerned by the Emergency. effectiveness of the actions at Member State and regional level in relation to the Community level, and shall coordinate the actions with regard to third countries. The Commission shall convene a crisis management group composed in particular of representatives of the industry and the Member States concerned by the Emergency. The Commission shall organise the tasks and duties of such a crisis management group taking into account the prerogatives of the Gas Coordination Group. The Commission shall ensure that the Gas Coordination Group is regularly informed about the work undertaken by the crisis management group. Convening the Gas Coordination group should not be optional. The Commission shall convene it in a Community Emergency to act swiftly. The crisis management group shall inform the GCG regularly. 32 Article 10 paragraph 4 4. When the Commission considers that in a Community Emergency, an action taken by a Competent Authority or natural gas undertakings is inappropriate to deal with the Emergency, or that it seriously endangers the situation in another Member State, the Commission shall require the Competent Authority or natural gas undertaking to change its action. Within three days from notification of the Commission's request, the Competent Authority concerned shall change its action 4. When the Commission considers that in a Community Emergency, an action taken by a Competent Authority or natural gas undertakings is inappropriate to deal with the Emergency, or that it seriously endangers the situation in another Member State, the Commission shall notify the Competent Authority or natural gas undertaking of the reasons why it considers that the body concerned needs to change its action. Within three days from this notification, the Competent Authority concerned shall change its action and notify the PR\ doc 23/33 PE v01-00

24 and notify the Commission or shall set out to the Commission why it does not agree with the request. In that case, the Commission may amend or withdraw its request. If, within three days, the Commission decides not to amend or withdraw its request, the Competent Authority shall comply with the Commission's request without delay. Commission or shall send a duly substantiated reply as to why the action in question is justified, taking into full account the commercial implications for natural gas undertakings and accounting for available compensation mechanisms. In that case, the Commission may amend or withdraw its request. If, within three days, the Commission decides not to amend or withdraw its request, it shall inform the Competent Authority as to why it considers the justification to be unacceptable. Under these circumstances, the Competent Authority shall comply with the Commission's request without delay. The Commission's proposal is too strong in wording and does not force the Commission to justify its rejection to the arguments put forward by the Competent Authority. The Commission should also justify its decisions. 33 Article 10 paragraph 5 5. The Competent Authority or natural gas undertakings shall not introduce any measure restricting the flow of gas within the internal market at any time. 5. The Competent Authority or natural gas undertakings shall not introduce any measure restricting the flow of gas within the internal market at any time, without prejudice with their legal duties in relation to health and safety and environmental matters. Undertakings have to respect many legal provisions regarding above mentioned matters. New provisions should not conflict with them. PE v /33 PR\ doc

25 34 Article 10 paragraph 6 6. In a Community Emergency, the Member States shall ensure that crossborder access to the storage facilities is maintained and shall not introduce any legal provisions which unduly restrict the flows of gas to the affected markets. 6. In a Community Emergency, the Member States shall ensure that crossborder access to the storage facilities based on existing commercial agreements is maintained and shall not introduce any legal provisions which unduly restrict the flows of gas to the affected markets. It had to be clarified that this access is granted on the basis of commercial agreements so that these agreements are protected. 35 Article 11 paragraph 1 1. A Gas Coordination Group is established to facilitate the coordination of measures concerning the security of supply. The Group shall be composed of representatives of the Competent Authorities, ACER, TSO-G and representative bodies of the industry concerned and relevant customers. The Commission shall decide on the composition of the Group ensuring its representativity and shall chair the Group. The Group shall establish its rules of procedure. 1. A Gas Coordination Group is established to facilitate the coordination of measures concerning the security of supply. The Group shall be composed of representatives of the Competent Authorities, the national regulatory authorities where they are not the Competent Authorities, ACER, TSO-G and representative bodies of the industry concerned and relevant customers. The Commission shall decide on the composition of the Group ensuring its representativity and shall chair the Group. The Group shall establish its rules of procedure. PR\ doc 25/33 PE v01-00

26 In line with the rest of the text in the Commission proposal. 36 Article 11 paragraph 2 point g (g) implementation of the Plans; (g) implementation and review of the Plans; The GCG is an excellent forum where the Plans can be reviewed in order to take into account best practices from other Member States and to check whether inconsistencies at EU level can be removed. 37 Article 11 paragraph 3 a (new) 3a. The Gas Coordination Group shall contribute to the definition of the regions used to implement more efficient measures ensuring gas supply. In doing so, it shall take into account: (a) results arising from the risk assessment; (b) the location of existing and planned infrastructures and supply routes; (c) the existing solidarity links, or those being developed between Member States. In order to achieve solidarity at regional level, the Gas Coordination Group shall create specific sub groups addressing security of supply issues at regional level. PE v /33 PR\ doc

27 This is in line with a previous amendment regarding the definition of regions for regional plans. 38 Article 12 paragraph 1 point b (b) hourly flow of gas at all cross-border entry and exit points as well as all points connecting a production facility to the network, storage, LNG in mcm/d; (b) hourly flow of gas at all cross-border entry and exit points as well as all points connecting a production facility to the network, storage, LNG in mcm/h; The hourly flows should be expressed in units per hour and not per day. 39 Article 12 paragraph 6 point b introductory part b) Natural gas undertakings shall notify the Commission of the following details of the contracts concluded with suppliers from third countries: b) The Competent Authorities shall notify the Commission of the following details of the contracts concluded by the natural gas undertakings of their respective Member States with suppliers from third countries on an aggregated basis: In order to take the adequate measures in a time of emergency all relevant authorities, whether national or at community level, should have the necessary data. However, commercially sensitive information has to be handled with extreme caution since any leak could create serious problems for gas undertakings both, inside and outside the Union. PR\ doc 27/33 PE v01-00

28 40 Article 12 paragraph 6 point b indent 3 - Flexibility of contracted volumes, including provisions related to take-orpay obligations. deleted In order to take the adequate measures in a time of emergency all relevant authorities, whether national or at community level, should have the necessary data. However, commercially sensitive information has to be handled with extreme caution since any leak could create serious problems for gas undertakings both, inside and outside the Union. 41 Annex II list 2 "Demand side" bullet 2 - Fuel switch possibility alternative backup fuels in industrial and power generation plants - Fuel switch possibility alternative backup fuels in industrial and power generation plants (in this case, additional GHG emissions deriving from a mandatory fuel-switch should not fall under the ETS scheme) Forced fuel-switching for generators to use more emitting sources of energy should not be accounted under the ETS regime. PE v /33 PR\ doc

29 42 Annex II list 2 "Demand side" bullet 3 - Increased efficiency deleted Energy efficiency is a long term policy goal and not an immediate response to a crisis. 43 Annex II list 2 "Demand side" bullet 4 - Increased use of renewable energy sources - Increased use of electricity generated by alternative sources to gas The use of renewables i sa long term policy goal and not an immediate response to a crisis. PR\ doc 29/33 PE v01-00

30 EXPLANATORY STATEMT I. Introduction A complete set of European policy measures, mainly stemming from the Communication on an "Energy Policy for Europe" in January , constitutes a response to the challenge of security of energy supply. In the gas sector, in addition to the Directive 2004/67/EC, a whole regulatory framework concerning infrastructures and interconnections indirectly contributes to this aim through (i) guidelines on Trans-European energy networks ('T-E projects') 2, (ii) the so-called '3rd energy package on internal electricity and gas market' adopted in June The legislative measures adopted for the integration of the gas market, by laying down rules concerning third party access to gas storages and liquefied natural gas facilities and transparency about gas reserves 3, will contribute to foster energy security. In the same way, the Parliament considered that promotion of regional solidarity, development of gas interconnections through a 10 years network development plan as well as a strong process of harmonisation of network access conditions through the cooperation of transport system operators were key points in the legislative package 4. The international aspects of security of energy supply were also tackled through resolutions 5 emphasising the need to further develop a common energy strategy for Europe that incorporates producers, distributors and consumers, to speak with "one single voice" and to create a transparent and sustainable energy system that enhances the regional diversity of energy supplies. The development of an 'EU Energy security and solidarity action plan', including revision of crisis responses mechanisms, was also highly encouraged by the Parliament. In this context, the rapporteur welcomes the proposal for a regulation on security of gas supply repealing Directive 2004/67/EC as it is a piece of legislation that gives a true answer to a real problem that the Union is facing. This became obvious during the gas crisis between Russia and Ukraine in the last winter when millions of European citizens and our economy suffered greatly. In this sense, the European Parliament, through the above-mentioned resolutions has asked for such an initiative and the rapporteur is convinced that Members will make a significant contribution in the coming months. He firmly believes that a full and speedy implementation of such a regulation, along with the legislation on the internal energy market, will reduce significantly the EU's vulnerability to external supply disruptions but it will also strengthen the leading role of European gas companies in the world and the Union's geo-political position as a strategic global player. 1 COM(2007)001 2 Decision 1364/2006, OJ L 262, , p Directive 2009/73/EC of 13 July 2009 concerning common rules for the internal market in natural gas and repealing Directive 2003/55/EC, OJ L 211, , p.94 OJ L 211, , p.36 4 Regulation (EC) No 715/2009 on conditions for access to the natural gas transmission networks and repealing Regulation (EC) No 1775/2005, OJ L 211, , p.36 5 EP resolution of 3 February 2009 on the Second Strategic Energy Review (2008/2239(INI)), T6-038/2009 EP resolution of 17 September 2009 on External aspects of energy security, T7-0021/2009 PE v /33 PR\ doc

31 II. Main points identified by the rapporteur 1. Issues addressed in the draft report The rapporteur considers that several points in the proposal for a regulation should be improved and has therefore proposed some amendments in the following areas: a. The Role of companies While the recitals and impact assessment make very clear that there are three steps for addressing a crisis (1. market, 2. Member States, 3 Community) the role of the undertakings seems to vanish into the legal text therefore it should be reinforced in the text in several areas, in particular, with regards to the role of the Gas Coordination Group and in the three levels of alert article. b. Reverse flows The current text proposes that all interconnectors should be equipped with reverse flow capacity. The rapporteur believes that this provision goes too far both economically or in terms of security of supply. There is no point, for example, in having reverse flows in the interconnectors with supplying countries. The Competent Authorities at national level and the Gas Coordination Group, at EU level, should determine those interconnectors where reverse flow capacity would be cost-efficient and represent an added value for security of supply in times of crisis. c. Preventive and emergency plans The rapporteur believes that, like Member States, the Commission should also develop preventive and emergency plans at EU level in order to best manage the situations where a Community emergency is declared. d. Community Emergency The current text establishes a 10% decrease in supply of imports as the threshold to declare automatically a Community Emergency. However, the Rapporteur believes that this threshold does not cover many scenarios where a Member State might have a crisis of 100% gas disruption yet not reach the 10% at EU level. For this reason, he has reinforced the provisions in the article concerning the possibility of declaring a community emergency for a defined geographical area. This should entail some Community solidarity mechanism, although to be implemented at regional level. e. Cost-sharing for new transnational investments in infrastructures Most of the Members have raised their concern regarding the costs of building or upgrading new infrastructures. This is particularly important as the implementation of this regulation will in many situations involve the construction in one Member States for the benefit of other Member States. The third internal energy market package already foresees mechanisms for PR\ doc 31/33 PE v01-00

32 the specific subject of cross-border interconnections. In this regard, the Rapporteur believes that these mechanisms could also be used for other type of infrastructures such as reverse flows. He explicitly includes a reference to the principle of proportionality in cost-sharing in relation to the benefits of security of supply. f. Non-market measures The Rapporteur has expressed on several occasions his desire to make more explicit the limits for Member States to intervene in the market. While he acknowledges that it is only under extreme circumstances that these measures can take place, there can be short or medium term consequences in the proper functioning of the market if they were enforced by the competent authorities. He has therefore underlined in the relevant parts of the text that non-market mechanisms should only be used as a last resort. g. Exchange of information The Rapporteur is a firm believer that in order to take the adequate measures in a time of emergency all relevant authorities, whether national or at Community level, should have the necessary data. However, commercially sensitive information has to be handled with extreme caution since any leak could create serious problems for gas undertakings both inside and outside the Union. For this reason, he proposes that these data should be centralised at national level and transmitted to the Commission by the competent authorities in an aggregated form. h. Role of the electricity sector The rapporteur acknowledges that in countries where households are mainly supplied by electricity generated through gas, concrete actions should be taken to ensure that during a crisis the protected customers do not suffer a blackout. In this sense, he includes this element for the elaboration of the risk assessments and the emergency plans. i. Other issues The rapporteur proposes a new Article on long term security of gas supply measures where the Commission should bring forward a report on possible ways to diversify, at Community level, the geographical sources and the routes into the EU as well as assessing fully the role of LNG installations. He also reinforces parts of the text with references to the importance of achieving increased interconnection capacity between Member States. He also believes that the current text only provides for preventive actions for a limited scope of scenarios and that it should allow for more flexibility in the case the form of the crisis varies in length or intensity. 2. Issues not addressed in the draft report at this stage of the procedure The Rapporteur has purposely decided not to address two particular issues in the draft report as he believes an in depth debate with Members should still take place due to their complexity. However, he wishes to explain what he intends to achieve in the final text on PE v /33 PR\ doc