24.07.2012

The President of the ERO has approved the new Transmission Network Code of GAZ-SYSTEM S.A.

The President of the Energy Regulatory Office has approved the Transmission Network Code (TNC) prepared by the Gas Transmission Operator GAZ-SYSTEM S.A. Earlier, the draft Code was subjected to consultation with the market participants. The new document introduces significant changes that will facilitate the liberalisation and development of the Polish gas market and will harmonise the principles of functioning of the system with the standards set by European transmission system operators. The Code introduces operational instruments for the development of the gas exchange market in Poland and implements solutions set out in the 3rd Energy Package.

Conclusion of agreements and contracting services of GAZ-SYSTEM S.A.

The TNC introduces changes to the methods of contracting transmission services. Each system user, benefitting from the transmission services, will now conclude only one agreement with GAZ-SYSTEM S.A. in the form of a framework agreement, which will form the basis for submitting applications to the operator for the possibility of using entry or exit points selected by the system user. The specimen agreement and appropriate forms will be shortly available on the website of GAZ -SYSTEM S.A.

Virtual gas trading point

The Code also introduces a virtual point to the high methane natural gas system, without a physical location in the transmission system, where gas trading will take place. This enables the sale and purchase of gas that is already in the transmission system. Such transactions will be performed also on the gas exchange, which will facilitate the shaping of prices on the basis of market principles and will guarantee the full confidentiality and anonymity of the transactions. This solution will allow market participants, including final customers, to sell and purchase gaseous fuel on prices that correspond to the supply and demand equilibrium. The details of this transactions will be regulated by The Regulations of Trading on the Exchange Commodity Market of Polish Power Exchange.

The introduction of the virtual entry/exit point not only opens up the way to creating a gas exchange in Poland but also facilitates the performance of transactions concluded on the OTC market as well as transactions conducted by GAZ-SYSTEM S.A. on the balancing market.

Capacity allocation mechanism

GAZ-SYSTEM S.A. has proposed auction mechanisms in the TNC that will enable more effective use of the available capacity. Those mechanisms are based on solutions prepared by the European Network of Transmission System Operators for Gas (ENTSOG) and correspond to the solutions that have been generally adopted in Europe as well as to the guidelines of the European Commission. 

Balancing market

The new Code sets out the functioning of the balancing services market, which provides the necessary instruments for balancing the system. The parties to the transactions on this market will be the transmission system users and GAZ-SYSTEM S.A. as the transmission system operator (TSO).
In relation to the current solutions, the Code restricts the number of imbalance limits to one daily imbalance limit only. The one and only basic balancing period is now the gas day, which means that the imbalance entity has to settle its accounts with the operator after every gas day. The TNC no longer foresees the designation of increasing imbalance quantities during the month. The purpose of creating a balancing services market is to ensure that appropriate instruments are available allowing GAZ-SYSTEM S.A. to maintain integrity of the system and ensure gas transmission security with the use of market mechanisms.

Agreements with  other operators (DSO and SSO) and distribution zones

The solutions adopted in the TNC will give rise to a marked simplification in the functioning of the gas market, particularly at connections with distribution and storage systems. Distribution zones have been created which are represented by one entry point and one exit point for the entire zone where given DSOs operate, in order to simplify the principles.

For such solutions to be possible, distribution system operators (DSOs) and storage system operators (SSOs) will conclude inter-operator transmission contracts (ITC) with GAZ-SYSTEM S.A. The ITC will encompass the currently binding operator contracts as well as other issues connected with capacity allocation. Pursuant to the proposed principles, only the DSO and SSO will purchase capacity (contracted capacity) at connections of their systems with the transmission system. This capacity will be made available to other market participants in the form of appropriate capacity allocations in the transmission system and  by the appropriate distribution or storage services of gaseous fuel. 

The solutions implemented by the new Transmission Network Code will ensure that a modern, liberal gas market will be able to be built and developed in Poland. The re-organisation of the principles of functioning of the transmission system will make it easier for new trading companies to operate and play an active part on the market, which will undoubtedly create increased and better competition.

The  Transmission Network Code will enter  into force on 1 December 2012.

Presentation on Source and Scope of changes in Transmission Network Code

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The Gas Transmission Operator GAZ-SYSTEM S.A. is a strategic Polish Company responsible for natural gas transmissions throughout Poland. The Company manages assets worth approx. 5 bn PLN comprised mainly of elements of the transmission system, e.g. more than 9.8 thousand km of high pressure pipelines, 14 compressor stations, 56 hubs and 970 exit points. The Company employs over 2,000 persons. GAZ-SYSTEM S.A. is also the owner of the Polskie LNG S.A. Company, which was established to construct the liquefied natural gas terminal (LNG) terminal in Świnoujście.

GAZ-SYSTEM S.A. is planning to construct over 1,000 km of new gas pipelines by 2014. The most important will be in north-west and central Poland (Szczecin–Lwówek, Świnoujście–Szczecin, Szczecin–Gdańsk, Rembelszczyzna–Gustorzyn, and Gustorzyn-Odolanów). The development of the gas transmission network in Poland may constitute an important element of the North - South Gas Corridor connecting the LNG terminal in Świnoujście with the planned Adria LNG terminal through the transmission infrastructure of Central European countries.

In 2011, GAZ–SYSTEM S.A. completed the construction of the Włocławek–Gdynia gas pipeline and the gas compressor station in Goleniów and the gas compressor station in Jarosław. The Company has also opened the new Poland–Czech Interconnector, which will enable the transmission of approx. 0.5 bcm of gas annually. GAZ-SYSTEM S.A. has also developed gas pipelines in Lower Silesia, which will enable the off-take of greater amounts of gas from the western direction. It is possible to transport up to 1.5 bcm of gas annually (the earlier capacity amounted to 0.9 bcm of gas annually) via the Lasów point on the Polish-German border.

Investments fulfilled by GAZ-SYSTEM S.A. in 2011 with their possibility of using virtual reverse flow services on the Yamal pipeline have created the technical possibilities to import over 3.3 bcm of gas annually to Poland from new sources (approx. 30% of the currently performed import).

 

Contact:
Małgorzata Polkowska
Press Spokesperson
tel. +48 22 220 15 46, mob.+48 691 911 217
e-mail: pr@gaz-system.pl

 

press release download: The President of the ERO has approved the new Transmission Network Code of GAZ-SYSTEM S.A.

 


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