RAE battling against time for needed gas market reforms

RAE, the Regulatory Authority for Energy, left with just two weeks to finalize the most recent bailout review’s demands concerning natural gas market reforms, yesterday launched a short public consultation procedure, to expire on Monday, for the gas sector’s Pricing Regulations Plan. It will detail the method used to determine regulated charges for distribution networks, based on new law.

As soon as the new Pricing Regulations Plan is endorsed and published in the government gazette, RAE will need to work on setting new distribution network usage tariffs for the country’s EPA gas supply companies.

Immediately afterwards, or no later than the end of September, the RAE board needs to endorse the new tariffs, a pivotal detail in the gas market reforms.

The tariff levels to be set by RAE are eagerly awaited by both consumers and the EPA gas supply company minority shareholders, Shell and Eni, as the prices to be set will determine whether the latter two companies will demand compensation from the Greek State for the premature end to their regional gas monpolies as a result of the gas market reforms, intended to generate competition in the market.

DEPA, the Public Gas Corporation, holds majority 51 percent stakes in the country’s three EPA gas supply companies. Shell holds a 49% stake in the company serving the wider Athens region, while the Italian multinational Eni holds 49% stakes in the Thessalia and Thessaloniki operations.

According to sources, RAE expects to have received many observations by Monday on the Pricing Regulations Plan from parties impacted by the revisions – suppliers, network users, customers, even EVIKEN, the Association of Industrial Energy Consumers. The positions of many interested parties are expected to oppose the plan as published for public consultation.

Burdened by a loaded agenda yet understaffed, RAE has moved slower than intended in meeting bailout-required gas market reforms.

The country’s third bailout agreement requires full separation of the distribution networks and EPA trading activity. This needs to be fully implemented as of January 1, 2017.