Polish industrial natural gas tariff could be deregulated by July - URE
Polish energy regulator URE said on Tuesday it expected the country's largest industrial end-users to have their natural gas tariffs deregulated from 1 July. This would have the effect of permitting wholesale over-the-counter (OTC) trade in the country.
Under Polish law, there is no distinction between gas retail and wholesale sales, which means that all transactions - regardless of contract length or size - are regulated. By deregulating the tariffs of the largest consumers, shippers will be able to trade OTC with each other at prices based on market fundamentals.
URE has a tariff-waiver surrounding trade that is conducted via the recently-opened bourse operated by POLPX, but the exchange has seen little trade.
The watchdog on Tuesday - through a newly published gas market liberalisation roadmap - said that it would lift the tariff restriction for industrials from the start of July on the assumption that at the same time, incumbent PGNiG would be obliged to offload 30% of its gas through POLPX.
The obligation, which is included in the proposed new gas market bill, would climb to cover 50% of PGNiG's gas by January 2014, and then reach 70% by July of that same year (see ESGM 12 October 2012). Whether the bill will be made into law by the middle of the year is unclear, however.
URE had previously said that deregulation of the market would only happen if it sees evidence of competition on the bourse among numerous counterparties. It would appear that by synchronising the sales obligation with the deregulation, more wholesale trade will occur.
PGNiG is opposed to the size of the obligation, as it recognises that the majority of trade at European hubs is done over the counter rather than through exchanges.
Poland has been referred by the European Commission to the Court of the Justice of the EU for failure to implement fully the gas directive within the third energy package and is facing hefty daily fines (see ESGM 21 November 2012). URE, along with the economy ministry, are therefore spearheading the roadmap to remove key barriers to gas trade.
Industrial gas consumption makes up around 70% of Polish gas demand. Tom Marzec-Manser
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