The European Gas Market: analysing the role of transmission tariffs

​The European Union Agency for the Cooperation of Energy Regulators (ACER) publishes today a report​ assessing the implementation of the Network Code on harmonised transmission tariff structures for gas, which was designed to facilitate cross-border trade, provide a level playing field between domestic and cross-border users and increase transparency.

With its review, the Agency aims to promote a better interpretation of the key principles of the EU legislation, as well as a review of national tariff practices' compatibility with the Network Code.

What are the main findings?

• Transparency on the reference price methodologies has improved significantly: transparency increases the understanding of tariff setting methodologies in the EU and may lead to more effective tariff designs in the future. The Report includes best practices across EU Member States and also presents several shortcomings, like incomplete descriptions of the methodologies.​
  

• Regional networks need to be better defined: ACER reports on the different treatment of regional networks across the EU. Regional networks supply domestic consumers and cannot be used for transporting gas to interconnection points between Member States. Allocating the costs of regional networks to users that do not benefit from them leads to cross-subsidises between users.
   
• Charges unrelated to transmission activities: Some Transmission System Operators collect charges unrelated to transmission, such as storage facilities, Liquefied Natural Gas facilities, biogas promotion, etc. ACER identifies the risks of these measures while acknowledging where these are useful. The Agency stresses the need for financial neutrality of the entity collecting these charges and that efficiently sized assets are charged to beneficiaries using these assets. ​
   
• In addition, the Agency has also assessed a large number of other implementation issues, such as clarifying the scope of the Network Code. The report also includes reflections on volume risk applications for transit flows, on inter-transmission system compensations, benchmarking tariffs, revenue reconciliation and cost allocation assessment.

Finally, the report also covers tariff changes and an assessment of best practices in terms of the publication of values and parameters related to the allowed revenue methodologies.

Documents:

Access the Main Report - Volume 1

Access the Country Asses​sments - Volume 2 ​

Find out more about the Network C​ode​