CONTRACTING

The process for contracting capacity for third-party access to the network, established in 2001 by Royal Decree 949/2001, of 3 August, which regulates third-party access to gas facilities and establishes an integrated economic system for the natural gas sector, was completely modified in 2015 with the publication in the Official State Gazette (BOE) of Royal Decree 984/2015, of 30 October, which regulates the organized gas market and third-party access to to natural gas system facilities, which regulates third-party access to gas facilities and the management of guarantees, among other issues.

Since 2019, it is the duty of the National Commission of Markets and Competition (CNMC) to establish, through a circular, the methodologies used to calculate the conditions for connection and access to gas and electricity networks.

To this purpose, in December 2019, the CNMC approved the Circular 8/2019 establishing the methodology and conditions for access and allocation in the natural gas system.

This Circular determines the operation of the gas system with regard to regulated third-party access to facilities, including the definition of the capacity services and products to be offered to the market, the procedures for capacity allocation, the overall criteria for the technical operation of the system, the basis for the establishment of guarantees relating to capacity contracting and the congestion management mechanisms.

The aim of the new access model established is to encourage and facilitate competition, promote greater use of gas infrastructures, harmonise, simplify and establish a transparent and competitive mechanism for the allocation and use of capacity, make agents' operations more flexible and resolve congestion situations at regasification plants.

Thus, in April 2020, the Resolution of 3 April 2020 of the National Commission of Markets and Competition was published, establishing the detailed procedure for the development of market mechanisms for the allocation of capacity in the gas system, which establishes the detailed procedure for the development of market mechanisms for the allocation of capacity in the transmission network, regasification plants and basic underground storage facilities.

The overall capacity allocation procedure is an auction-based market mechanism.

Furthermore, in order to simplify and harmonize capacity contracting procedures, the CNMC approved a standardized model contract for access to gas system facilities and the necessary addenda to include the contracted capacities. This Framework Contract is included in the Resolution of 15 April 2020, of the National Commission of Markets and Competition, whereby the framework contract for access to gas system facilities is adopted.

The Framework Contract will be signed by the parties by means of the electronic signature of the document of acceptance and adhesion thereto approved by the Resolution of 15 April 2020 (Annex II).

The contracting of both individual and aggregated access services referred to in the Framework Contract will be performed through the platform to apply for capacity contracting (SL-ATR, acronym of the Logistic System for Third-Party Access to the Networks) managed by the System Technical Manager independently. Every application for capacity acquisition submitted shall entail a firm commitment, binding on the parties, to acquire the product in question. Every application for capacity submitted to the platform shall be subject to a validation process to check that sufficient guarantees have been provided. The platform shall enable contracting sufficiently in advance taking into account the time horizons for each product.

The contract shall be finalized at the time of awarding or of matching in the cases where capacity allocation is made through market procedures. At that moment, the platform will generate an addendum to the Framework Contract, differentiated for each product and service contracted, with a unique code identifying it, stating the contracted facilities, the type of product, the contracted quantity, the start date and the duration of the contracted service.

For more information, please write to reganosa@reganosa.com