Energinet listens to shippers regarding new tariff structure
Published 5.4.2017 17.40
On 16 March 2017, the EU Commission published the final version of the new network code for gas transmission tariffs. Now each member state must implement the framework in its national rules.
The new EU Regulation sets the framework for harmonizing gas transmis-sion tariff structures in Europe. As part of the implementation process, which must be completed by 1 October 2019, Energinet has invited stake-holders to a series of workshops that focus on various areas of the new network code. Through this collaborative process, Energinet listens to in-put and suggestions from shippers in the Danish market which in turn helps us design a tariff structure that most optimally supports a transparent and efficient gas market.
Tariff structure must fit the Danish Gas Market
An important task in the implementation process is to identify which method for calculating gas transmission tariffs is the better fit for the Dan-ish gas market. As part of this work, Danish stakeholders will be asked to give their input on the pros and cons of various tariffs structures.
Stakeholders will be invited to evaluate three methods. The first one is called the “postage stamp” method, because network users pay a fixed price regardless of the actual distance travelled by the gas. This method provides shippers with predictable tariffs for all entry and exit points in a specific price area.
Another method is called Capacity Weighted Distance which calculates the relative cost to the entire system of each entry/exit point by factoring in the actual distance travelled by the gas.
Finally, there is the Virtual Point Based method, which is the method cur-rently applied in the Danish gas market. The Virtual Point Based method calculates the relative cost to the entire system of each entry/exit point based on the distance from a given point to a virtual point in the network.
Regardless of the method chosen, Energinet must report its choice to the Danish Energy Regulatory Authority. Also, the Capacity Weighted Distance method will be applied as a “benchmark” against which the cost-reflectivity of any other method is measured.
The final version of ”Network code on harmonised transmission tariff structures for gas”
Presentation from the kick-off meeting on 9 March 2017.