European Communities (Internal Market in Natural Gas) Regulations, 2005

• Jurisdiction: Ireland

I, Noel Dempsey, Minister for Communications, Marine and Natural Resources, in exercise of the powers conferred on me by section 3 of the European Communities Act 1972 (No. 27 of 1972) and for the purpose of giving effect to Directive 2003/55/EC1 of the European Parliament and of the Council of 26 June 2003 hereby make the following regulations: — 1. These Regulations may be cited as the European Communities (Internal Market in Natural Gas) Regulations 2005. 2. The following section is substituted for section 10A (as amended by section 14 of the Gas (Interim) (Regulation) Act 2002 and the European Communities (Internal Market in Natural Gas) Regulations 2004 ( S.I. No. 426 of 2004 )) of the Gas Act 1976 :

“10A — (1) In this section —

‘Directive’ means Directive 2003/55/EC of the European Parliament and of the Council of 26 June 2003 concerning common rules for the internal market in natural gas and repealing Directive 98/30/EC;

‘facility’ means a transmission or distribution pipeline, an LNG facility or a natural gas storage facility;

‘LNG’ means liquefied natural gas;

‘LNG facility’ has the same meaning as in the Directive;

‘operator’ means the holder of a natural gas licence in respect of the operation of a downstream distribution or transmission pipeline, an LNG facility, or a natural gas storage facility;

‘pipeline operator’ means the holder of a natural gas licence in respect of the operation of a distribution or transmission pipeline;

‘storage facility’ has the same meaning as in the Directive;

‘third party access’ means-

(a) in the case of a downstream natural gas pipeline transportation of natural gas through a pipeline operator’s pipeline,

(b) in the case of an LNG facility, access to and use of an LNG facility under the control of the operator, and

(c) in the case of a storage facility, access to and use of a storage facility, or to related ancillary services under the control of the operator in circumstances where the Commission considers that it is technically or economically necessary for providing efficient access to the natural gas system for the supply of customers, (but excluding temporary storage and ancillary services that are related to LNG facilities and are necessary for the re-gasification process and subsequent delivery to the transmission system)

and the Commission shall determine that which constitutes ‘circumstances where it is technically or economically necessary for providing efficient access to the natural gas system for the supply of customers’ referred to in subparagraph (c).

(2) (a) Subject to subsection (7) and subject to such exemptions as may be granted in accordance with Article 22 of the Directive, where an application is received for third party access in respect of a facility operated by a person licensed under section 16 of the Gas (Interim) (Regulation) Act 2002 from or on behalf of an eligible customer, the facility operator shall offer to enter into an agreement for such access, subject to terms and conditions specified in directions issued by the Commission under subsection (4).

(b) In paragraph (a), ‘eligible customer’ means —

(i) the holder of a natural gas licence under section 16 of the Gas (Interim) (Regulation) Act 2002 , for the purpose of carrying out any activity for which the holder is licensed;

(ii) the holder of a petroleum lease under section 13 of the Petroleum and Other Minerals Development Act 1960 , for the purpose of carrying out any activity connected with the lease;

(iii) a person in respect of whom an order has been made under section 2 (1) of the Gas (Amendment) Act 1987 , for the purpose of carrying out the functions conferred on the person by the order;

(iv) a person who operates a gas-fired generating station, irrespective of its annual consumption level, for the purpose of providing energy for the generation of electricity at that station; or

(v) a customer (within the meaning of section 2 of the Gas (Interim (Regulation) Act 2002 ) purchasing natural gas which is not exclusively for his or her household use.

(3) Notwithstanding the generality of subsection (2),-

(a) an offer made under that subsection may include an offer to grant access at a rate or for a volume or at a rate and for a volume different from that requested-

(i) where the offer is as well as an offer of access at the requested rate and volume, or

(ii) where the request may be refused in accordance with subsection (7);

(b) the Commission shall have the power to examine the reasons for making an offer under paragraph (a) and to give appropriate directions with regard to the volume and rate to be offered, without prejudice to any direction given under subsection (4);

(c) where connection to the facility of the operator is required by the applicant or enhancement of that facility would be necessary to grant the application, an offer made under that subsection-

(i) shall include the terms for such a connection or enhancement including any charges for connection or enhancement, and details of all technical aspects relating to the connection or enhancement that might be reasonably required by that person, and

(ii) at the request of the applicant, may be on the basis that the applicant constructs, or that either or both the applicant and the operator make arrangements to have constructed, the connection to the facility, and the ownership of any such connection constructed or arranged to be constructed by the applicant shall, subject to subsection (10), be a matter for agreement between the parties.

(4) The Commission may by direction provide for—

(a) the matters to be specified in an agreement for third party access, including terms and conditions relating to price;

(b) the matters to be specified in an agreement for connection to or enhancement of the facility of the operator;

(c) the terms and conditions, including terms and conditions relating to price of the connection or enhancement, upon which an offer for connection to or enhancement of the facility of the operator is made;

(d) the methods for determining the proportion of the costs to be borne by the person making the application for connection to or enhancement of the facility of the operator and to be borne by the operator being costs which are directly or indirectly incurred in carrying out works under an agreement or making an enhancement or connection or modifying an existing connection;

(e) the terms and conditions upon which applications for an agreement are to be made and the period of time within which an offer or refusal pursuant to an application is to be made by the operator; and

(f) any other matters which the Commission considers necessary or expedient for the purpose of making an offer for third party access, or connection to a facility.

(5) An operator shall comply with any direction made by the Commission under subsection (3) or (4) within such time period as may be specified by the Commission in the direction.

(6) An operator shall not make an offer under subsection (2) of this section other than to a person who is an eligible customer within the meaning of subsection (2).

(7) An operator may refuse to enter into an agreement under subsection (2)—

(a) on the basis of a lack of capacity in its facility save where it is economical for the operator to make the necessary enhancements to the capacity of the facility in accordance with such conditions as may be specified by the Commission in a direction made under subsection (4);

(b) on the basis of a lack of connection to that facility save where the person making the request is willing to pay for such a connection in accordance with such conditions as may be specified by the Commission in a direction made under subsection (4);

(c) where, to enter into an agreement under this section would be likely to involve the operator in a contravention or a breach of—

(i) this Act, the Electricity Regulation Act 1999 , the Gas (Amendment Act 2000 , or the Gas (Interim)(Regulation) Act 2002 ;

(ii) regulations made under any of the aforesaid Acts;

(iii) the conditions of any licence granted or consent given to the pipeline operator under this Act or the Gas (Interim)(Regulation) Act 2002 ;

(iv) the code of operations...