What happens when it gets cold? Efficient Access to Gas Infrastructures Meinhard Janssen GIE Board Member Annual Conference 2005, Athens, 3 - 4 Nov 2005 There is currently no real coverage of Storage. If the title has to be kept the same (I realise this is the presentation titalt given on the conference agenda) then it would be appropriate to add a slide on storage. 3 – 4 Nov 2005 GIE - Gas Infrastructure Europe

GIE - Gas Infrastructure Europe Agenda Where were we? Where are we now? Are TSOs prepared when it gets cold? What still needs to be done? Conclusion 3 – 4 Nov 2005 GIE - Gas Infrastructure Europe

What happens when it gets cold? GIE - Gas Infrastructure Europe 3 – 4 Nov 2005 GIE - Gas Infrastructure Europe

GIE - Gas Infrastructure Europe 1. Where Were We? “the European gas industry has managed security of supply in a steadily growing European gas market over the last four decades very successfully” Source: European Commission Integrated gas companies were responsible for availability of sufficient gas and diversification of supply availability of sufficient transport and storage capacity integrity of infrastructure With the movement towards market liberalisation under the Internal Market Directives roles and responsibilities of market players have become fragmented. 3 – 4 Nov 2005 GIE - Gas Infrastructure Europe

GIE - Gas Infrastructure Europe 2. Where Are We Now? (1) Key Developments Legislation / Voluntary Guidelines 2003/55/EC 2. Directive for Internal Gas Market (2004 & 2007 deadlines) 2004/67/EC Directive for Security of Supply (due to take effect as of May 2006) Gas Regulation on transmission access (due to take effect as of July 2006) Guidelines for Good Practice for transmission access (GGP II) and storage access (GGPSSO) 3 – 4 Nov 2005 GIE - Gas Infrastructure Europe

GIE - Gas Infrastructure Europe 2. Where Are We Now? (2) Key Developments Gas Industry Legal Unbundling of TSO in almost all EU countries Entry and exit systems implemented in all EU countries Increased information transparency / online capacity information Wider range of services (e.g. short term & interruptible capacity) Secondary capacity markets UIOLI Hubs & virtual trading points established with growing liquidity EASEE-gas activities on interoperability: 3 CBPs fully approved 3 – 4 Nov 2005 GIE - Gas Infrastructure Europe

3. Are TSOs prepare when it gets cold? TSOs have implemented almost all requirements of applicable law and voluntary guidelines However, TSOs are still on a learning curve (e.g. changes to main gas flow/supply sources, abolishment of integrated optimisation, planning of security of supply) In any case, security of supply and system integrity have priority 3 – 4 Nov 2005 GIE - Gas Infrastructure Europe

4. What Still Needs To Be Done? When implementing 2. Directive for Internal Gas Market and Directive for Security of Supply into national law member states are required to define clear roles and responsibilities of market players to implement a regulatory framework providing a healthy investment climate to ensure that necessary investments are really being made 3 – 4 Nov 2005 GIE - Gas Infrastructure Europe

Clear Roles and Responsibilities Roles and responsibilities when it gets cold… to ensure there is sufficient gas  suppliers1 to ensure there is sufficient transportation capacity  TSOs and shippers to ensure system integrity  TSOs 1 in some EU countries also legal obligations on TSOs 3 – 4 Nov 2005 GIE - Gas Infrastructure Europe

Regulatory Framework / Investment Climate With the move towards liberalised markets the main determinants for investment should be market signals For infrastructure investment the industry needs Stable, predictable, commensurate and complete regulatory framework To finance and mitigate risks Long-term contracts will form a key part of future investments Exemptions under Art. 22 of IGM Directive required especially for Pan-European projects 3 – 4 Nov 2005 GIE - Gas Infrastructure Europe

GIE - Gas Infrastructure Europe 5. Conclusion The European Gas Industry has an excellent record in maintaining security of supply The European Gas Industry has significantly improved the access to gas infrastructure The European Gas Industry is gathering experiences resulting from changes of the libarised gas market There is a need for Clear allocation of responsibilities to different market players Predictable & stable regulatory environment supporting an incentivising investment climate 3 – 4 Nov 2005 GIE - Gas Infrastructure Europe

What happens when it gets cold? GIE - Gas Infrastructure Europe 3 – 4 Nov 2005 GIE - Gas Infrastructure Europe

What happens when it gets cold? GIE - Gas Infrastructure Europe 3 – 4 Nov 2005 GIE - Gas Infrastructure Europe

What happens when it gets cold? GIE - Gas Infrastructure Europe 3 – 4 Nov 2005 GIE - Gas Infrastructure Europe