Proposal for a Directive of the European Parliament and of the Council amending Directives 96/92/EC and 98/30/EC concerning common rules for the internal market in electricity and natural gas
Date: 2001-03-13
Institutions: European Commission
Subjects: EU law, electrical energy, energy supply, energy transport, natural gas, single market, storage

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Official Journal of the European Communities

28.8.2001

Proposal for a Directive of the European Parliament and of the Council amending Directives
96/92/EC and 98/30/EC concerning common rules for the internal market in electricity and
natural gas

(2001/C 240 E/11)

(Text with EEA relevance)

COM(2001) 125 final (cid:151) 2001/0077(COD)

(Submitted by the Commission on 13 March 2001)

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF
THE EUROPEAN UNION,

Having regard to the Treaty establishing the European
Community, and in particular Article 47(2), Article 55 and
Article 95 thereof,

Having regard to the proposal from the Commission,

Having regard to the opinion of
Committee,

the Economic and Social

Having regard to the opinion of the Committee of the Regions,

Acting in accordance with the procedure laid down in Article
251 of the Treaty,

Whereas:

(1) Directive 96/92/EC of the European Parliament and of the
Council of 19 December 1996 concerning common rules
in electricity (1) and Directive
for the internal market
the
the European Parliament
98/30/EC of
Council of 22 June 1998 concerning common rules for
in natural gas (2) have made very
the internal market
important contributions towards the creation of internal
markets for electricity and gas.

and of

(2) Experience in implementing those Directives demonstrates
the important benefits that have begun to result from the
internal markets in electricity and gas, in terms of effi-
ciency gains, price reductions, higher standards of service
and increased competitiveness. However, important short-
comings and possibilities for improving the functioning of
the markets remain.

(3) At its meeting in Lisbon on 23 and 24 March 2000, the
European Council called for rapid work to be undertaken
to complete the internal market in both electricity and gas
sectors and to speed up liberalisation in these sectors with

(1) OJ L 27, 30.1.1997, p. 20.
(2) OJ L 204, 21.7.1998, p. 1.

a view to achieving a fully operational
internal market.
The European Parliament, in its Resolution of 6 July 2000
on the Commission’s second report on the state of
the
energy markets,
liberalisation
Commission to adopt a detailed timetable
the
achievement of accurately defined objectives with a view
to gradually but completely liberalising the energy market.

requested
for

of

(4) The main obstacles in arriving at a fully operational
internal market are related to issues of access to the
network and different degrees of market opening
between Member States.

(5) In order
to achieve non-discriminatory access to the
the transmission system
network,
the independence of
operator is of paramount importance. The provisions on
unbundling should therefore be strengthened. In order to
ensure non-discriminatory access
to the distribution
network, unbundling requirements for the distribution
system operator should be introduced for both electricity
and gas distribution system operators.

(6) To avoid imposing a disproportionate financial and
administrative burden on small distribution companies,
to
Member States
exempt
unbundling
such
requirements.

should be able, where necessary,
companies

from the

(7) Further measures should be taken in order to ensure
transparent, predictable and non-discriminatory tariffs
for access to essential transportation and related infra-
structure, including storage and other ancillary facilities.
Those tariffs should be applicable to all system users on a
non-discriminatory basis.

(8) In the light of the experience gained with the operation of
Council Directive 90/547/EEC of 29 October 1990 on the
transit of electricity through transmission grids (3) and
Council Directive 91/296/EEC of 31 May 1991 on the
transit of natural gas through grids (4), measures should
be taken to ensure homogeneous and non-discriminatory
access regimes for transmission, including across borders
between Member States.

(3) OJ L 313, 13.11.1990, p. 30; Directive as

last amended by

Commission Directive 98/75/EC (OJ L 276, 13.10.1998, p. 9).

(4) OJ L 147, 12.6.1991, p. 37; Directive as

last amended by

Commission Directive 95/49/EC (OJ L 233, 30.9.1995, p. 86).

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is

(9) The presence of
an

independent national regulatory auth-
orities,
guaranteeing
important
non-discriminatory access to the network. Those auth-
orities should at
least have the competence to fix or
approve transmission and distribution tariffs and tariffs
for access to liquefied natural gas (LNG) facilities, prior
to their entry into force.

feature

in

(10) National regulatory authorities should be able to approve
tariffs on the basis of a proposal by the transmission
system operator or distribution system operator(s) or
LNG system operator, or on the basis of a proposal
the
agreed between these operator(s) and the users of
network.

(11) The benefits resulting from the internal market should be
available to all Community industry and commerce,
including small and medium-sized enterprises and to all
Community citizens as quickly as possible for reasons of
competitiveness and employment.

(12) Gas and electricity customers should be able to choose
their supplier freely. Nonetheless a phased approach to
for electricity and gas
completing the internal market
should be taken to enable industry to adjust and ensure
that adequate measures and systems are in place to
protect the interests of customers and ensure they have
a real and effective right to choose supplier.

(17) Member States should ensure that all customers enjoy the
right to be supplied with electricity of a specified quality
at affordable and reasonable prices. In order to ensure the
maintenance of the highest possible standards of public
service in the Community, all measures taken by Member
States to achieve the objectives of this Directive should be
regularly notified to the Commission. The Commission
should regularly publish a report analysing measures
taken at national level to achieve public service objectives
and comparing their effectiveness, with a view to making
recommendations as regards measures to be taken at
national level to achieve high public service standards.

(18) The requirement to notify the Commission of any refusal
to grant authorisation to construct new generation
capacity has proven to be an unnecessary administrative
burden and should therefore be dispensed with.

(19) Directives 96/92/EC and 98/30/EC should therefore be

amended accordingly.

(20) In accordance with the principles of subsidiarity and
proportionality as set out in Article 5 of the Treaty, the
objectives of the proposed action, namely the creation of
fully operational
internal electricity and gas markets, in
which fair competition prevails, cannot be sufficiently
achieved by the Member States and can therefore, by
reason of the scale and effects of the action, be better
achieved by the Community. This Directive confines
itself to the minimum required in order to achieve those
objectives and does not go beyond what is necessary for
that purpose.

(13) Progressive market opening towards full competition will
gradually remove differences between Member States.
Transparency and certainty in the implementation of
this Directive should be ensured.

(21) To ensure homogeneity in the treatment of access to the
electricity and gas networks, also in the case of transit,
Directives 90/547/EEC and 91/296/EEC should be
repealed,

(14) Directive 98/30/EC provides for access to storage as part
of the gas system. In the light of the experience gained in
implementing the internal market, additional measures
should be taken to clarify the provisions for access to
storage and other ancillary services and to reinforce the
separation
transmission and
distribution systems, and gas storage and LNG facilities.

operation

the

of

of

(15) Nearly

all Member States have

chosen to ensure
competition in the electricity generation market through
a transparent authorisation procedure. However, Member
States should have the possibility to ensure security of
supply through the launching of a tendering procedure
in the event that sufficient electricity generation capacity
is not built on the basis of the authorisation procedure.

(16) In the interest of security of supply, the supply/demand
balance in individual Member States should be monitored
and appropriate action taken if security of supply is
compromised.

HAVE ADOPTED THIS DIRECTIVE:

Article 1

Amendments to Directive 96/92/EC

Directive 96/92/EC is amended as follows:

1. Article 2 is amended as follows:

(a) point (9) is replaced by the following:

(cid:145)9. (cid:147)final customer(cid:148) shall mean a consumer buying

electricity for his own use.(cid:146)

(b) point (22) is replaced by the following:

(cid:145)22. (cid:147)non-domestic customer(cid:148) shall mean a consumer
purchasing electricity which is not for his own
household use and shall include producers, trans-
mission
and
wholesale customers.(cid:146)

undertakings

distribution

and

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2. Article 3 is replaced by the following:

(cid:145)Article 3a

(cid:145)Article 3

subsidiarity,

1. Member States shall ensure, on the basis of their
institutional organisation and with due regard for the
to
principle of
paragraph 2, electricity undertakings are operated in
accordance with the principles of this Directive, with a
view to achieving a competitive market
in electricity.
Member States shall not discriminate between these under-
takings as regards either rights or obligations.

that, without prejudice

Having regard to the relevant provisions of

the
2.
in particular Article 86, Member States may
Treaty,
electricity
impose on undertakings operating in the
in the general economic interest, public service
sector,
to security,
including
obligations which may relate
security of
regularity, quality and price of
supply,
supplies and to environmental protection. Such obligations
shall be clearly defined,
transparent, non-discriminatory
and verifiable. As a means of carrying out public service
obligations in relation to security of supply, Member States
may introduce the implementation of long-term planning,
taking into account the possibility of third parties seeking
access to the system.

3. Member States shall ensure that all customers enjoy
universal service, that is the right to be supplied with
electricity of a specified quality within their territory at
affordable and reasonable prices. They shall take appro-
priate measures to protect final customers and to ensure
high levels of consumer protection, particularly with
respect to transparency regarding contractual terms and
information and dispute settlement
conditions, general
mechanisms. These measures shall
in particular,
include,
those set out in the Annex.

4. Member States shall implement appropriate measures
to achieve the objectives of social and economic cohesion,
environmental protection and security of supply, notably
through the maintenance and construction of necessary
network infrastructure including interconnection capacity.

5. Member States may decide not
to apply the
provisions of Articles 5, 6, 16 and 21 in so far as their
application would obstruct the performance, in law or in
fact, of the obligations imposed on electricity undertakings
in the general economic interest and in so far as the devel-
opment of trade would not be affected to such an extent as
would be contrary to the interests of the Community. The
interests of the Community include, inter alia, competition
with regard to eligible customers in accordance with this
Directive and Article 86 of the Treaty.(cid:146)

3. The following Article 3a is inserted:

1. Member States shall, every two years, notify the
Commission of all measures adopted to fulfill universal
service and public service obligations, whether or not
such measures require a derogation from the provisions
of this Directive. This notification shall relate,
inter alia,
to the requirements of Article 3(4) and the maintenance
of service standards.

The Commission shall publish, every two years, a
2.
report analysing the different measures
taken in the
Member States to meet high public service standards,
the effectiveness of
together with an examination of
those measures.

Where appropriate, the Commission shall make recom-
level
mendations as to measures to be taken at national
to achieve high public service standards.(cid:146)

4. Article 4 is deleted.

5. Article 5 is replaced by the following:

(cid:145)Article 5

1.
For the construction of new generating capacity,
Member States shall adopt an authorisation procedure,
which shall be conducted in accordance with objective,
transparent and non-discriminatory criteria.

2. Member States shall
lay down the criteria for the
grant of authorisations for the construction of generating
capacity in their territory. These criteria may relate to:

(a)

the safety and security of the electricity system, instal-
lations and associated equipment;

(b) protection of public health and safety;

(c) protection of the environment;

(d)

land use and siting;

(e) use of public ground;

(f) energy efficiency;

(g) the nature of the primary sources;

(h) characteristics particular

to the applicant,
technical, economic and financial capabilities;

such as

(i) compliance with measures adopted pursuant to Article

3.

The authorisation procedures and criteria shall be

3.
made public.

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Applicants shall be informed of the reasons for any
4.
refusal to grant an authorisation. The reasons must be
objective, non-discriminatory, well
founded and duly
substantiated. Appeal procedures shall be made available
to the applicant.(cid:146)

(a) those persons responsible for the management of the
transmission system may not participate in company
structures of
the integrated electricity undertaking
responsible, directly or indirectly, for the day-to-day
operation of the generation, distribution and supply
of electricity;

6. Article 6 is amended as follows:

(a) Paragraph 1 is replaced by the following:

(cid:145)1. Member States shall ensure the possibility, in the
for new
interests of security of supply,
capacity on the basis of published criteria. A
tendering procedure can, however, only be launched
the authorisation procedure the
if on the basis of
capacity being built
to ensure
sufficient
security of supply.(cid:146)

to tender

is not

(b) appropriate measures must be taken to ensure that the
interests of the persons responsible for the
personal
management of
the transmission system are taken
into account in a manner that ensures that they are
capable of acting independently;

(c)

the system operator must exercise full control over all
assets necessary to maintain and develop the network;

(b) Paragraph 2 is deleted.

(c) Paragraph 6 is deleted.

7. The following Article 6a is inserted:

(cid:145)Article 6a

1. Member States shall designate a body, which may be
the independent regulatory authority referred to in Article
22, to monitor security of supply issues. This body shall
monitor, in particular, the supply/demand balance on the
national market, the level of expected future demand and
under
capacity
envisaged
construction, and the level of competition on the market.
The body shall publish, by 31 July each year at the latest a
report outlining its findings on these issues, as well as any
measures taken or envisaged to address them and forward
this report to the Commission forthwith.

additional

planned

or

On the basis of the report referred to in paragraph 1
2.
the Commission shall, on an annual basis,
forward a
Communication to the European Parliament and the
Council examining issues relating to security of supply of
electricity in the Community, and in particular the existing
and projected balance between demand and supply. Where
appropriate, the Commission shall issue recommendations.(cid:146)

8. In Article 7, paragraph 6 is replaced by the following:

(cid:145)6.
Unless the system operator is already fully inde-
pendent from other activities not relating to the trans-
system
mission system in terms of ownership,
operator shall be independent at
its
legal form, organisation and decision-making from other
activities not relating to transmission.

the
in terms of

least

In order
operator, the following criteria shall apply:

to ensure the independence of

the system

is

excluded.

discriminatory

(d) the system operator must establish a compliance
programme, which sets out measures taken to ensure
that
The
conduct
programme must set out the specific obligations of
employees to meet this objective.
It must be drawn
up and its respect monitored by a compliance officer
appointed by and reporting to the President/Chief
Executive of the integrated electricity undertaking to
system operator belongs. An annual
which the
report,
taken, must be
submitted by the compliance officer to the national
regulatory authority and published.(cid:146)

the measures

setting out

9. The following Article 7a is inserted:

(cid:145)Article 7a

Transmission system operators shall procure the energy
functions
they use
according to transparent, non-discriminatory and market
based procedures.(cid:146)

carrying out of

their

the

for

10. In Article 8, the following paragraphs 5 and 6 are added:

(cid:145)5. Member States may require transmission system
operators to meet minimum levels of investment for the
maintenance and development of the transmission system,
including interconnection capacity.

Rules adopted by transmission and distribution
6.
system operators for balancing,
in real time, generation
and consumption of electricity, shall be transparent and
non-discriminatory. Tariffs and terms and conditions for
the provision of such services by system operators shall
be established in a non-discriminatory way reflecting
prevailing market prices and shall be fixed or approved
by the national regulatory authority prior to their entry
into force.(cid:146)

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11. In Article 10, the following paragraph 4 is added:

from other

Unless the system operator is already fully inde-
(cid:145)4.
to the
activities not
pendent
the system
distribution system in terms of ownership,
operator shall be independent at
its
legal form, organisation and decision-making from other
activities not relating to distribution.

in terms of

relating

least

In order
operator, the following criteria shall apply:

to ensure the independence of

the system

(a) those persons responsible for the management of the
distribution system may not participate in company
structures of
the integrated electricity undertaking
responsible, directly or indirectly, for the day-to-day
operation of the generation, transmission and supply
of electricity;

(b) appropriate measures must be taken to ensure that the
personal
interests of the persons responsible for the
management of the distribution system are taken into
account in a manner that ensures that they are capable
of acting independently;

(c)

the system operator must exercise full control over all
assets necessary to maintain and develop the network;

is

excluded.

discriminatory

(d) the system operator must establish a compliance
programme, which sets out measures taken to ensure
The
conduct
that
programme must set out the specific obligations of
employees to meet this objective.
It must be drawn
up and its respect monitored by a compliance officer
appointed by and reporting to the President/Chief
Executive of the integrated electricity undertaking to
system operator belongs. An annual
which the
report,
taken, must be
submitted by the compliance officer to the national
regulatory authority and published.

the measures

setting out

The provisions of the first and second subparagraphs shall
apply from 1 January 2003. Member States may decide
to apply those provisions to integrated electricity
not
undertakings serving less than 100 000 customers at that
date.(cid:146)

12. The following Article 12a is inserted:

(cid:145)Article 12a

other activities not relating to transmission or distribution
system operation and which meets the requirements of
Article 7(6).(cid:146)

13. In Article 14, paragraph 3 is replaced by the following:

in their
(cid:145)3.
shall,
Integrated electricity undertakings
their
for
internal accounting, keep separate accounts
generation, distribution and supply activities, and, where
appropriate, consolidated accounts for other, non-elec-
tricity activities, as they would be required to do if the
activities in question were carried out by separate under-
takings, with a view to avoiding discrimination, cross-
subsidisation and distortion of competition. The internal
accounts shall
include a balance sheet and a profit and
loss account for each activity.(cid:146)

14. Article 15 is deleted.

15. Article 16 is replaced by the following:

(cid:145)Article 16

1. Member States shall ensure the implementation of a
system of
third party access to the transmission and
distribution systems based on published tariffs, applicable
to all eligible customers and applied objectively and
without discrimination between system users. These
tariffs shall be approved prior to their entry into force
by
in
conformity with Article 22.

established

regulatory

authority

national

a

The operator of a transmission or distribution system
2.
may refuse access where it lacks the necessary capacity.
Duly substantiated reasons must be given for
such
refusal, in particular having regard to Article 3.(cid:146)

16. Articles 17 and 18 are deleted.

17. Article 19 is replaced by the following:

(cid:145)Article 19

1. Member States shall ensure that all non-domestic
customers are free to purchase electricity from the
supplier of
the
latest. They shall ensure that all customers are free to
choose their supplier from 1 January 2005 at the latest.

their choice from 1 January 2003 at

To avoid imbalance in the opening of electricity

2.
markets:

The rules in Articles 7(6) and 10(4) do not prevent the
operation of a combined transmission and distribution
system operator, which is fully independent in terms of
form, organisation and decision-making from
its legal

(a) contracts for the supply of electricity with an eligible
customer in the system of another Member State shall
not be prohibited if
the customer is considered as
eligible in both systems involved;

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(b) in

as

described

cases where

in
transactions
subparagraph (a) are refused because of the customer
the two systems, the
being eligible only in one of
Commission may oblige,
the
situation in the market and the common interest, the
refusing party to execute the requested electricity
supply at the request of the Member State where the
eligible customer is located.(cid:146)

taking into account

18. In Article 20, paragraph 4 is replaced by the following:

In the event of cross-border disputes, the dispute
(cid:145)4.
settlement
settlement
authority covering the system operator which refuses use
of, or access to, the system.(cid:146)

authority shall be

the dispute

19. Article 22 is replaced by the following:

(cid:145)Article 22

shall establish national

regulatory
1. Member States
authorities. These authorities shall be wholly independent
of interests of the electricity industry. They shall at least
have the sole responsibility:

(a) to fix or approve terms and conditions for connection
and access to national networks, including transmission
and distribution tariffs;

20. The following Article 23a is inserted:

(cid:145)Article 23a

Member States shall inform the Commission by 31 March
of each year at the latest of imports of electricity that have
taken place during the previous calendar year from third
countries.(cid:146)

21. Article 26 is replaced by the following:

(cid:145)Article 26

review the application of

The Commission shall
this
Directive and submit a report to the European Parliament
and the Council, by [indicate a date] at the latest and by
[indicate a date] at the latest, on the experience gained and
progress made in creating a complete and fully operational
internal market
to allow the
in electricity in order
European Parliament and the Council to consider, in due
time, the possibility of provisions for further improving the
internal market in electricity. In particular, the report shall
examine the extent to which the unbundling and tarifi-
cation requirements of this Directive have been successful
in ensuring fair and non-discriminatory access to the
Community’s electricity system. The report
shall also
examine possible necessary harmonisation requirements
that are not linked to the provisions of this Directive.(cid:146)

(b) to fix or approve tariffs, or changes in tariffs at
level, to reflect costs or revenues related to

national
cross border transmission of electricity;

22. The Annex, the text of which is set out in Annex I to this

Directive, is added.

(c)

to define the rules on the management and allocation
of interconnection capacity,
in conjunction with the
national regulatory authority or authorities of those
Member States with which interconnection exists;

Article 2

Amendments to Directive 98/30/EC

Directive 98/30/EC is amended as follows:

(d) to fix or approve any mechanisms

congested capacity within the national
system;

to deal with
electricity

(e)

to ensure the respect of the requirements set out in
Article 3(3) and (4).

2. Member States shall create appropriate and efficient
mechanisms for regulation, control and transparency so as
to avoid any abuse of dominant position, in particular to
the detriment of consumers, and any predatory behaviour.
These mechanisms shall take account of the provisions of
the Treaty, and in particular Article 82 thereof.

the appropriate
3. Member States shall ensure that
measures be taken,
including administrative action or
criminal proceedings in conformity with their national
law, against
responsible
where confidentiality rules
imposed by this Directive
have not been respected.(cid:146)

the natural or

legal persons

1. Article 2 is amended as follows:

(a) the following point 12a is inserted:

(cid:145)12a (cid:147)ancillary

services(cid:148)

shall mean all

the operation of

services
transmission
necessary for
LNG
and/or
facilities,
and
equivalent flexibility instruments, load balancing
and blending;(cid:146)

distribution
including

networks
storage

and/or
facilities

(b) the following point 20a is inserted:

(cid:145)20a (cid:147)non-domestic customer(cid:148) shall mean a consumer
purchasing natural gas which is not for his own
power
use
household
generators,
and
natural
wholesale customers;(cid:146)

include
undertakings

shall

and

gas

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2. Article 3 is replaced by the following:

3. The following Article 3a is inserted:

(cid:145)Article 3

(cid:145)Article 3a

subsidiarity,

1. Member States shall ensure, on the basis of their
institutional organisation and with due regard for the
principle of
to
paragraph 2, natural gas undertakings are operated in
accordance with the principles of this Directive with a
view to achieving a competitive market in natural gas.
Member States shall not discriminate between such under-
takings as regards either rights or obligations.

that, without prejudice

Having regard to the relevant provisions of

the
2.
Treaty,
in particular Article 86 thereof, Member States
may impose on natural gas undertakings, in the general
economic interest, public-service obligations which may
relate to security, including security of supply, regularity,
quality and price of
supplies, and to environmental
protection. Such obligations shall be clearly defined, trans-
parent, non-discriminatory and verifiable. As a means of
in relation to
carrying out public-service obligations
security of supply, Member States may introduce the
implementation of
into
account the possibility of third parties seeking access to
the system.

long-term planning,

taking

3. Member States shall
take appropriate measures to
final customers and to ensure high levels of
protect
consumer protection, particularly with respect to trans-
parency regarding contractual
and conditions,
general
information and dispute settlement mechanisms.
These measures shall include, in particular, those set out
in the Annex.

terms

4. Member States shall implement appropriate measures
to achieve the objectives of social and economic cohesion,
environmental protection and security of supply, notably
through the maintenance and construction of necessary
network infrastructure including interconnection capacity.

5. Member States may decide not
to apply the
provisions of Article 4 with respect to distribution in so
far as their application would obstruct, in law or in fact,
the performance of the obligations imposed on natural gas
undertakings in the general economic interest and in so far
as the development of trade would not be affected to such
an extent as would be contrary to the interests of the
Community. The interests of
the Community include,
inter alia, competition with regard to eligible customers
in accordance with this Directive and Article 86 of the
Treaty.(cid:146)

1. Member States shall, every two years, notify the
Commission of all measures adopted to fulfil public
service obligations, whether or not such measures require
a derogation from the provisions of this Directive. This
inter alia, to measures regarding
notification shall relate,
environmental protection, security of supply, protection
and
of
regional
service
standards.

and the maintenance of

including final

customers,

customers,

cohesion,

social

The Commission shall publish, every two years, a
2.
report analysing the different measures
taken in the
Member States to meet high public service standards,
the effectiveness of
together with an examination of
those measures. Where appropriate,
the Commission
shall make recommendations as to measures to be taken
at national level to achieve high public service standards.(cid:146)

4. The following Article 4a is inserted:

(cid:145)Article 4a

1. Member States shall designate a body, which may be
the independent regulatory authority referred to in Article
22, to monitor security of supply issues. This body shall
monitor, in particular, the supply/demand balance on the
national market, the level of expected future demand and
available supplies, and the level of competition on the
market. The body shall publish, by 31 July each year at
the latest, a report outlining its findings on these issues, as
well as any measures taken or envisaged to address them,
and shall forward this report to the Commission forthwith.

Parliament

On the basis of the report referred to in paragraph 1,
2.
the Commission shall forward a Communication to the
European
year
examining issues relating to security of supply of natural
gas in the Community, and in particular the existing and
projected balance between demand and supply. Where
appropriate, the Commission shall issue recommendations.(cid:146)

the Council

each

and

5. Article 7 is replaced by the following:

(cid:145)Article 7

1. Member States shall designate or shall require under-
takings which own transmission, storage or LNG facilities
to designate, for a period of time to be determined by
Member States having regard to considerations of effi-
ciency and economic balance, one or more system
operators to be responsible for operating, ensuring the
maintenance of, and developing the transmission, storage
and LNG facilities in a given area and their intercon-
nections with other
to guarantee
security of supply.

in order

systems,

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Each transmission,

2.
operator:

storage

and/or LNG system

the transmission system are taken
management of
into account in a manner that ensures that they are
capable of acting independently;

(a) shall operate, maintain and develop under economic
conditions secure, reliable and efficient transmission,
storage and/or LNG facilities, with due regard to the
environment;

(b) shall not discriminate between system users or classes
of system users, particularly in favour of its related
undertakings;

any

(c) shall provide any other transmission undertaking, any
other storage undertaking, any other LNG undertaking
and/or
sufficient
information to ensure that the transport and storage
of natural gas may take place in a manner compatible
with the secure and efficient operation of the intercon-
nected system.

undertaking,

distribution

Rules for balancing the gas system adopted by trans-
3.
mission and distribution system operators shall be trans-
parent and non-discriminatory. Tariffs and terms and
conditions for the provision of such services by system
operators shall be established in a non-discriminatory
way reflecting prevailing market prices and shall be fixed
or approved by the national regulatory authority prior to
their entry into force.(cid:146)

(c)

the transmission system operator must exercise full
control over all assets necessary to maintain and
develop the network;

that discriminatory conduct

(d) the transmission system operator must establish a
compliance programme, which sets out measures
taken to ensure
is
excluded. The programme must set out the specific
It
obligations of employees to meet
must be drawn up and its respect monitored by a
compliance officer appointed by and reporting to the
President/Chief Executive of the integrated natural gas
undertaking to which the transmission system operator
belongs. An annual report, setting out the measures
taken, must be submitted by the compliance officer
to the national regulatory authority and published.

this objective.

Article 7b

Transmission system operators shall procure the energy
for
functions
they use
according
and
to
market-based procedures.(cid:146)

the
transparent,

non-discriminatory

carrying out of

their

6. The following Articles 7a and 7b are inserted:

7. In Article 10, the following paragraph 4 is added:

(cid:145)Article 7a

1. Member States may require transmission system
operators to meet minimum levels of investment for the
maintenance and development of the transmission system,
including interconnection capacity.

2.
Unless the transmission system operator is already
fully independent from other activities not relating to the
the trans-
transmission system in terms of ownership,
mission system operator shall be independent at least in
terms of its legal form, organisation and decision making
from other activities not relating to transmission.

In order to ensure the independence of the transmission
system operator, the following criteria shall apply:

(a) those persons responsible for the management of the
transmission system may not participate in company
structures of
the integrated natural gas undertaking
responsible, directly or indirectly, for the day-to-day
operation of the production, distribution and supply
of gas;

(b) appropriate measures must be taken to ensure that the
the

interests of persons

responsible for

personal

(cid:145)4.
Unless the distribution system operator is already
fully independent from other activities not relating to the
distribution system in terms of ownership, the distribution
system operator shall be independent at least in terms of
its legal
form, organisation and decision-making from
other activities not relating to distribution.

In order to ensure the independence of the distribution
system operator, the following criteria shall apply:

(a) those persons responsible for the management of the
distribution system may not participate in company
structures of
the integrated natural gas undertaking
responsible, directly or indirectly, for the day-to-day
operation of the production, transmission and supply
of gas;

interests of persons

(b) appropriate measures must be taken to ensure that the
personal
the
management of the distribution system are taken into
account in a manner that ensures that they are capable
of acting independently;

responsible for

(c)

the distribution system operator must exercise full
control over all assets necessary to maintain and
develop the network;

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Official Journal of the European Communities

28.8.2001

conduct

that discriminatory

(d) the distribution system operator must establish a
compliance programme, which sets out measures
taken to ensure
is
excluded. The programme must set out the specific
It
obligations of employees to meet
must be drawn up and its respect monitored by a
compliance officer appointed by and reporting to the
President/Chief Executive of the integrated natural gas
undertaking to which the distribution system operator
belongs. An annual report, setting out the measures
taken, must be submitted by the compliance officer
to the national regulatory authority and published.

this objective.

The provisions of the first and second subparagraphs shall
apply from 1 January 2004. Member States may decide
not to apply those provisions to integrated natural gas
undertakings serving less than 100 000 customers at that
date.(cid:146)

8. The following Article 11a is inserted:

(cid:145)Article 11a

The rules in Article 7a(2) and Article 10(4) do not prevent
the operation of a combined transmission and distribution
system operator, which is fully independent in terms of its
legal form, organisation and decision-making from other
activities not
relating to transmission or distribution
system operation and which meets the requirements of
Article 7a(2).(cid:146)

9. In Article 13, paragraph 3 is replaced by the following:

for

Integrated natural gas undertakings shall,

in their
(cid:145)3.
internal accounting, keep separate accounts
their
natural gas transmission, distribution, supply, LNG and
storage activities, and, where appropriate, consolidated
accounts for non-gas activities, as they would be required
to do if the activities in question were carried out by
separate undertakings, with a view to avoiding discrimi-
nation, cross-subsidisation and distortion of competition.
The internal accounts shall include a balance sheet and a
profit and loss account for each activity.(cid:146)

relation to cross-border transmission, have access to the
network of other
transmission system operators based
on the same conditions and principles as set out in para-
graph 1.

Article 15

For

the organisation of access

to storage and
1.
equivalent flexibility instruments when technically and/or
economically necessary for providing efficient access to the
system for the supply of customers, as well as for the
organisation of access to other ancillary services, Member
States may choose either or both procedures referred to in
paragraphs 2 and 3. These procedures shall operate in
accordance with objective, transparent and non-discrimi-
natory criteria.

2.
In the case of negotiated access, Member States shall
take the necessary measures for natural gas undertakings
and eligible customers either inside or outside the territory
covered by the interconnected system to be able to
negotiate access to the system so as to conclude supply
contracts with each other on the basis of voluntary
commercial agreements. The parties shall be obliged to
negotiate access to the system in good faith.

Contracts for access to the system shall be negotiated with
the relevant system operator or natural gas undertakings.
Member States shall require natural gas undertakings to
publish their main commercial conditions for the use of
the system by [indicate date] at the latest and every year
thereafter.

3. Member States opting for a procedure of regulated
access shall take the necessary measures to give natural gas
undertakings and eligible customers either inside or outside
the territory covered by the interconnected system a right
of access to the system, on the basis of published tariffs
and/or other terms and obligations for use of that system.
This right of access for eligible customers may be given by
into supply contracts with
enabling them to enter
than the
competing natural gas undertakings other
owner and/or operator of the system or a related under-
taking.(cid:146)

10. Articles 14 and 15 are replaced by the following:

(cid:145)Article 14

11. Article 16 is deleted.

1. Member States shall ensure the implementation of a
third party access to the transmission and
system of
distribution system and LNG facilities based on published
tariffs, applicable to all eligible customers and applied
objectively and without discrimination between system
users. These tariffs shall be approved prior to their entry
into force by a national regulatory authority established in
conformity with Article 22.

2.
Transmission system operators shall, if necessary and
for the purpose of carrying out their functions including in

12. Articles 18 and 19 are replaced by the following:

(cid:145)Article 18

1. Member States shall ensure that all non-domestic
customers are free to purchase gas from the supplier of
their choice and shall have the rights of eligible customers
for third party access in order to execute such supplies in
accordance with Articles 14 and 15 from 1 January 2004
at the latest.

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2. Member States shall ensure that all customers are free
to purchase gas from the supplier of their choice and have
the rights of eligible customers for third party access in
order to execute such supplies in accordance with Articles
14 and 15 from 1 January 2005 at the latest.

Article 19

To avoid imbalance in the opening of gas markets:

the supply of gas with an eligible
for
(a) contracts
customer
in the system of another Member State
shall not be prohibited if the customer is considered
as eligible in both systems involved;

(b) in

as

described

cases where

in only one of

in
transactions
subparagraph (a) are refused because the customer is
the
eligible
Commission may oblige,
the
situation in the market and the common interest, the
refusing party to execute the requested gas supply, at
the request of the Member State where the eligible
customer is located.(cid:146)

two systems,
taking into account

the

13. Article 22 is replaced by the following:

(cid:145)Article 22

shall establish national

1. Member States
regulatory
authorities. These authorities shall be wholly independent
of the interests of the gas industry. They shall at least have
the sole responsibility:

(a) to fix or approve terms and conditions for connection
and access to national networks, including transmission
and distribution tariffs, and terms, conditions and
tariffs for access to LNG facilities;

(b) to define the rules on the management and allocation
of interconnection capacity,
in conjunction with the
national regulatory authority or authorities of those
Member States with which interconnection exists;

(c)

to fix or approve any mechanisms
congested capacity within the national gas system;

to deal with

(d) to ensure the respect of the requirements set out in

Article 3(3) and (4).

2. Member States shall create appropriate and efficient
mechanisms for regulation, control and transparency so as
to avoid any abuse of dominant position, in particular to
the detriment of consumers, and any predatory behaviour.
These mechanisms shall take account of the provisions of
the Treaty, and in particular Article 82 thereof.

3. Member States shall ensure that
measures be taken,

the appropriate
including administrative action or

criminal proceedings in conformity with their national
law, against
responsible
where confidentiality rules
imposed by this Directive
have not been respected.(cid:146)

the natural or

legal persons

14. Article 28 is replaced by the following:

(cid:145)Article 28

review the application of

The Commission shall
this
Directive and submit a report to the European Parliament
and the Council, by [indicate date] at the latest and by
[indicate date] at the latest, on the experience gained and
progress made in creating a complete and fully operational
to allow the
in natural gas in order
internal market
European Parliament and the Council to consider, in due
time, the possibility of provisions for further improving the
internal market in natural gas.
In particular, the report
shall examine the extent to which the unbundling and
this Directive have been
tarification requirements of
successful in ensuring fair and non-discriminatory access
to the Community’s gas system The report shall also
examine possible necessary harmonisation requirements
which are not linked to the provisions of this Directive.(cid:146)

15. The Annex, the text of which is set out in Annex II to this

Directive, is added.

Article 3

Directives 90/547/EEC and 91/296/EEC are repealed with effect
from 1 January 2003.

Article 4

Member States shall bring into force the laws, regulations and
administrative provisions necessary to comply with this
Directive by 31 December 2002 at
the latest. They shall
forthwith inform the Commission thereof.

When Member States adopt those provisions, they shall contain
a reference to this Directive or be accompanied by such a
reference on the occasion of
their official publication.
Member States shall determine how such reference is to be
made.

Article 5

This Directive shall enter into force on the twentieth day
following that of its publication in the Official Journal of the
European Communities.

Article 6

This Directive is addressed to the Member States.

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ANNEX I

(cid:145)ANNEX

(Article 3)

Without prejudice to Community rules on consumer protection,
Parliament and of the Council (1) and Council Directive 93/13/EC (2):

in particular Directive 97/7/EC of the European

(a) Member States shall ensure that final customers have a right to a contract with their electricity service provider that

specifies:

(cid:151) the identity and address of the supplier;

(cid:151) services provided, the service quality levels offered, as well as the time for the initial connection;

(cid:151) the types of maintenance service offered;

(cid:151) the means by which up-to-date information on all applicable tariffs and maintenance charges may be obtained;

(cid:151) the duration of the contract, the conditions for renewal and termination of services and of the contract;

(cid:151) any compensation and the refund arrangements which apply if contracted service quality levels are not met; and

(cid:151) the method of initiating procedures for settlement of disputes in accordance with point (f).

(b) Member States shall ensure that

final customers shall be given adequate notice of any intention to modify
contractual conditions and shall be free to withdraw from contracts if they do not accept the new conditions.

(c) Member States shall ensure that transparent information on applicable prices and tariffs, and on standard terms and
conditions, in respect of access to and use of electricity services is available to the public, and particularly to final
customers.

(d) Member States shall ensure that electricity suppliers specify in the bills sent to each final consumer, the composition
of the fuel mix used to generate the electricity that is consumed by the final consumers they supply. The relative
costs of the different fuels used to generate a unit of electricity supplied to the final consumers shall be specified and
the relative importance of each energy source with respect to the production of greenhouse gases.

(e) Member States shall also implement appropriate measures to protect vulnerable customers.

(f) Member States shall ensure that transparent, simple and inexpensive procedures are available for dealing with final
customer complaints. Member States shall adopt measures to ensure that such procedures enable disputes to be
settled fairly and promptly with provision, where warranted, for a system of reimbursement and/or compensation.
They should follow, wherever possible, the principles set out in Commission Recommendation 98/257/EC (3).

(1) OJ L 144, 4.6.1997, p. 19.
(2) OJ L 95, 21.4.1993, p. 29.
(3) OJ L 115, 17.4.1998, p. 31.(cid:146)

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ANNEX II

(cid:145)ANNEX

Without prejudice to Community rules on consumer protection,
Parliament and of the Council (1) and Council Directive 93/13/EC (2):

in particular Directive 97/7/EC of the European

(a) Member States shall ensure that final customers have a right to a contract with their gas service provider that

specifies:

(cid:151) the identity and address of the supplier;

(cid:151) services provided, the service quality levels offered, as well as the time for the initial connection;

(cid:151) the types of maintenance service offered;

(cid:151) the means by which up-to-date information on all applicable tariffs and maintenance charges may be obtained;

(cid:151) the duration of the contract, the conditions for renewal and termination of services and of the contract;

(cid:151) any compensation and the refund arrangements which apply if contracted service quality levels are not met; and

(cid:151) the method of initiating procedures for settlement of disputes in accordance with point (e).

(b) Member States shall ensure that

final customers shall be given adequate notice of any intention to modify
contractual conditions and shall be free to withdraw from contracts if they do not accept the new conditions.

(c) Member States shall ensure that transparent information on applicable prices and tariffs, and on standard terms and
in respect of access to and use of gas services is available to the public, and particularly to final

conditions,
customers.

(d) Member States shall also implement appropriate measures to protect vulnerable customers.

(e) Member States shall ensure that transparent, simple and inexpensive procedures are available for dealing with final
customer complaints. Member States shall adopt measures to ensure that such procedures enable disputes to be
settled fairly and promptly with provision, where warranted, for a system of reimbursement and/or compensation.
They should follow, wherever possible, the principles set out in Commission Recommendation 98/257/EC (3).

(1) OJ L 144, 4.6.1997, p. 19.
(2) OJ L 95, 21.4.1993, p. 29.
(3) OJ L 115, 17.4.1998, p. 31.(cid:146)