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TAR NC Implementation Document – Second Edition September 2017
ARTICLE 37 POWER TO GRANT DEROGATIONS
Responsibility: subject to NRA decision
General
Article 37 recognises that interconnectors are a distinct type of a TSO (such as
Interconnector UK, BBL, Interconnector 1 and Interconnector 2). The specific
nature of interconnectors might warrant exemption from some of the Articles in the
TAR NC. Article 37 allows interconnectors meeting certain criteria to apply for and
be granted a derogation from one or more Articles of the TAR NC granted by the
relevant NRAs.
The Gas Directive distinguishes between transmission networks and interconnectors.
Article 2(17) of that Directive defines an ‘interconnector’ as
‘a transmission line
which crosses or spans a border between MSs for the sole purpose of connecting
national transmission systems of those MSs’
. Such interconnectors’ characteristics
include:
\\
They are single pipelines with very few entry/exit points;
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They have no captive demand, that is no directly connected end-user demand;
\\
They are not directly connected to downstream distribution networks;
\\
They may compete directly with other assets such as storage, LNG and other
pipelines in providing flexibility to the connected transmission networks;
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They may be merchant assets without an allowed or target revenue set in
accordance with Article 41(6)(a) of the Gas Directive.
Process for granting a derogation from the TAR NC
Figure 44 shows the process for applying and assessing a derogation from the
TAR NC. A derogation can cover all or some of the TAR NC provisions subject to
NRA decision. The TAR NC does not foresee any explicit time limit for such a dero-
gation.
The process starts with a request from an entity operating an interconnector to the
relevant NRAs. Such an interconnector must be the one that
‘has benefited from’
:
(a) an exemption from Article 41(6), (8) and (10) of the Gas Directive in accordance
with Article 26 of the Gas Directive; or (b)
‘a similar exemption’
. The applicant must
demonstrate all/some TAR NC provisions would have one or several of the following
negative consequences:
(1) not facilitating efficient gas trade and competition;
(2) not providing incentives for investing in new capacity or for maintenance of
existing capacity;
(3) unreasonable distortion of cross-border trade;
(4) distortion of competition with other infrastructure operators offering similar to
interconnector services; and
(5) not being implementable when taking into account the specific nature of
interconnectors.
This list of consequences included in Article 37(2) of the TAR NC is exhaustive –
however, meeting one of them suffices for a derogation request. The interconnector
requesting a derogation must provide detailed reasoning, supporting documents
and, where appropriate, a CBA. Such CBA must demonstrate one or more negative
consequences listed in point (1) to (5) above.