National Legal and Regulatory Framework-test

Primary Legislation

The import, trade (supply), transmission and distribution of natural gas in Greece were initially regulated by L. 2364/1995 (Government Gazette Α’ 252/6.12.1995).

Subsequently, in order to comply with the obligations regarding the liberalization of the natural gas market which were imposed by the 2nd Energy Package of the European Union regarding the common set of rules of the internal gas market (Directive 2003/55/EC and ΕC Reg. 1775/2005), L. 3428/2005 (Government Gazette Α’ 313/27.12.2005)on “The Liberalization of the Natural Gas Market“ was issued, which integrated into national legislation the aforementioned provisions of the European Directives and Regulations.

Following the issuance of the 3rd energy package and in order to comply with its provisions (specifically, Directive 2009/73/EC and the EC Regulations 713/2009 & 715/2009), with the ultimate goal the further smooth completion of the internal natural gas market and the creation of equal access terms for all natural gas companies within the EU, the new energy law L. 4001/2011 (Government Gazette Α’ 179/22.8.2011) for the operation of Energy Markets for Electricity and Natural Gas was enacted, which replaced in its majority L. 3428/2005. Directive 2009/73/EC introduced the unbundling of the networks from the supply and generation activities with the adoption of three alternative models (ownership unbundling, ISO, ITO) since it was considered that the legal and operational unbundling foreseen in the previous, repealed Directive 2005/55/EC did not bring satisfying results as per the achievement of the above goal.  L. 4001/2011 initially provided only for the adoption of Ownership Unbundling.The Legislative Act of 16.12.2011 (Government Gazette Α’ 262/16.12.2011), foresaw the possibility of enactment of the Independent Transmission Operator model (ΙΤΟ) for the Transmission Systems owned by a Vertically Integrated Company on September 3rd 2009, as well as the option to choose, for the Vertically Integrated Companies wishing to do so, the Ownership Unbundling Model. The provisions of Law 4001/2011 regarding the Independent Transmission Operator were amended with L.4093/2012 (Government Gazette Α’ 222/12.11.2012)Legislative Act Government Gazette Α’229/19.11.12 and L.4111/2013 (Government Gazette Α’ 18/25.01.2013).  

L. 4336/2015(Government Gazette Α’ 94/14.8.2015)L.4337/2015 (Government Gazette A’ 129/17.10.2015), as well as L.4414/2016 (Government Gazette A’ 149/09.08.2016), article 55 of L.4423/2016 (Government Gazette Α’ 182/27.09.2016) and article 15 of L.4425/2016 (Government Gazette A’ 185/30.09.2016), amended L.4001/2001, in order to further liberalize the natural gas market in Greece via the restructuring of the natural gas distribution framework through the obligation of the Vertically Integrated Natural Gas Companies for legal and functional unbundling of their natural gas distribution activities from their supply activities and the widening of the definition of “Eligible” Customers. The abovementioned new provisions also include details concerning the implementation of the respective legal and functional unbundling.   

L. 4001/2011 was also amended, inter alia, by the following:  

  • Article 17 (13) of L. 4203/2013 (Government Gazette Α’ 235/1.11.2013) and in turn article 2(2) of L. 4336/2015 (Government Gazette Α’ 94/14.8.2015) amended article 73 of L. 4001/2011 concerning security of supply so as to comply with the European Regulation 994/2010. Furthermore, article 17 (12) of L. 4203/2013 amended article 2 (2) of L. 4001/2011 and then MD Δ1/Β/10233/2014 (Government Gazette Β’ 1684/24.06.2014) was issued by the same law further laying down the categories of Protected Natural Gas Consumers.
  • Article 55 (8) of L.4223/2013 (Government Gazette Α’ 287/31.12.2013), replaced article 85(4), second subparagraph, of L. 4001/2011, and extended the duration of the provisions of article 24 of L. 3175/2003 (related to Take or Pay charges) up to 31.12.2015.
  • By virtue of article 96 of L.4512/2018 (Government Gazette Α’ 5/17.1.2018) concerning the restructuring of the Greek energy market, new articles 117A, 117B, 117Γ, 117Δ, 117E, 118E were introduced to L.4001/2011, which contain detailed provisions on the operation of the Energy Exchange, while with par. 4-7 of article 64 of L.4546/2018 (see below) specific provisions were added to articles 117B and 117E concerning RAE’s approval of the budgeted operational expenses of the Energy Exchange and of the Clearing Entity (concerning the time period from their incorporation up until 31.12.2018).
  • By virtue of article 24 of L.4513/2018 (Government Gazette Α’ 9/23.1.2018), the main subsequent amendments are the following: a) the framework for the natural losses offsetting and self-consumption of the NNGS is defined, also adjusted in order to comply with the requirements of EU Regulation 312/2014 on Gas Balancing, b) the Electronic Trading Platform of natural gas is reinforced for the even more efficient operation of the secondary market (resale, release/transfer of capacity and storage), c) the provisions for security of supply are amended so that the fee owed to power producers which use natural gas as fuel and with an obligation for an alternative fuel also covers the cost differential between oil and natural gas for the trials prior to signing of an agreement with DESFA, while particularly for the winter period of 2017-2018 power producers also have the obligation to hold natural gas reserves on a floating tank based on terms to be specified in a RAE decision and d) minimum capital requirements are introduced for candidates and holders of supply licenses, Independent Natural Gas System, Operation of the Independent Natural Gas System, Distribution and Operation of the Distribution Network. Case β’of par.8 of the article in question was amended by article 40.2 of L.4546/2018 (see below) and demands henceforth that holders of Gas Supply Licenses, of ASFA Licenses, of ASFA Operation Licenses, of Distribution and Distribution Operation Licenses within nine (9) months from the entry into force of the Revised Licenses Regulation to submit to RAE an application for an amendment of their license accompanied by additional information which attests their compliance with the provisions of article 90 of L.4001/2011, as amended by L.4513/2018 and L. 4546/2018 and in force, so as not to have their license revoked.
  • By virtue of par.1 article 40 of L.4546/2018 (Government Gazette Α’ 101/12.06.2018): a) a new paragraph was added on the ASFA Operations License (article 77 of L.4001/2011), as well as a subparagraph regarding Distribution and Distribution Operation Licenses (par.1 of article 80Γ of L.4001/2011), which stipulate that the Licenses in question shall foresee the terms, the conditions and necessary measures to ensure the independence and the operational unbundling of the license holder, b) by virtue of article 81, par.1 of L.4001/2011 for the supply of natural gas it is foreseen that henceforth a Supply License is not required for gas sales to a Supplier or Wholesale Customer and that RAE will monitor the way in which the Supply activity will be performed by Wholesale Customers, c) article 84 of L.4001/2011 concerning resale was repealed. In addition, par.2 of article 47 of the law in question replaces the 1st subparagraph of par.2 of article 80B of L.4001/2011 and it is foreseen that the expansion works of the existing Distribution Networks which take place from 1.04.2017 onward from EDA Attica, Thessaloniki and Thessalia are under their exclusive ownership.
  • By virtue of article 53 of L.4602/2019 (Government Gazette Α’ 45/09.03.19) articles 80Δ, 80Ε, 80ΣΤ, 80Ζ, 80Η, 80Θ, 80Ι, 80ΙΑ, 80ΙΒ, 80ΙΓ and 80ΙΔ were added following article 80Γ of L. 4001/2011, which foresee the full ownership unbundling of companies which own a Natural Gas Distribution Network and exercise the responsibilities of operator of the network from the activities of generation or supply of natural gas or electricity or electricity trading. In addition, the article in question contains provisions for the corporate restructuring of DEPA S.A. into DEPA Commercial S.A. and DEPA Infrastructure S.A., as well as the sale of shares of the above companies to interested investors.

Secondary Legislation

1. Licensing

2. National Natural Gas Transmission System (NNGS) Operation

  • NNGS Code of Operation:

The first version of the NNGS Code of Operation was issued by virtue of M.D. Δ1/Α/5346/2010 (Government Gazette Β’ 379/1.4.2010).Pursuant to the abovementioned Code, the “Standard Natural Gas Transmission and LNG Facility Usage Agreements” were issued by virtue of RAE decision No. 611/2010 (Government Gazette Β’ 480/20.4.2010).

The first (1st) Revision of the NNGS Code entered into force on October 14, 2011 by virtue of RAE Decision 1096/2011 (Government Gazette Β’ 2227/14.10.2011). The revision aimed at supplementing – improving the provisions of the Code, as well as attempting its harmonization with the European Gas Target Model. As a result of this revision, RAE, with its decision No 126/2012 (Gov. Gaz. B’ 907/23.3.2012)approved the new Standard Natural Gas Transmission and LNG Facility Usage Agreements, which are compliant with the revised provisions of the Code.

The second (2nd) revision of the NNGS Operation Code (Government Gazette B’ 3131/9.12.13) was issued on December 9, 2013 so as to adjust mainly to the provisions of the Tariff Regulation of July 5, 2012 (see paragraph below), as well as to the provisions of European Regulation (EC) 994/2010 concerning measures to safeguard security of gas supply and the provisions of Regulation (EC) 715/2009 on the conditions for access to the natural gas transmission networks, as amended by Commission Decision 2012/490/EU concerning measures for congestion management. An unofficial (commissioned by DEPA) translation in the English language of the 2nd revision of the NNGS Code is available on our website. Based on the 2nd Code Revision, the revised Standard Natural Gas Transmission and LNG Facility Usage Agreements (RAE Decision 635/2013, Government Gazette B’ 3325/27.12.2013) were issued.

The 3rd Revision of the NNGS Code (RAE Decision 239/2017- Government Gazette B’ 1549/5.5.2017) was issued on May 5th 2017 and came in force on June 1st, 2017. The purpose of the revision in question is to include the provisions of European Regulations on Capacity Allocation (EU 984/2013), rules on Balancing (EU 312/2014) and on Interoperability and Data Exchange rules (EU 703/2015). Based on the 3rd Code Revision, the new Standard Framework Natural Gas Transmission and LNG Facility Usage Agreements (RAE Decision 257/2017 – Government Gazette B’ 1443/27.4.2017) were issued and are in force as of June 1st, 2017.

The 4th Revision of the NNGS Code (RAE Decision 123/2018- Government Gazette B’ 788/7.3.2018) comes in force July 1st 2018. The scope of the revision in question is the adaptation of the national regulatory framework to the European framework, following the enforcement of European Regulations (EU) No 459/2017 (on capacity allocation mechanisms in gas transmission systems and repealing Regulation (EU) No 984/2013), and (EU) No 1938/2017 (concerning measures to safeguard the security of gas supply and repealing Regulation (EU) No 994/2010). The main amendments concern the creation of a Virtual Trading Point, the Auction of within-day firm capacity products at Interconnection Points (including the Entry Point “Kipi”) and the operation of a Balancing Platform on which the TSO will conduct auctions of short-term standard products which are necessary for the balancing of the NNGS and on which Users shall also trade among themselves as well as with the TSO in order to balance their position.
Based on the 4th Code Revision, the new Standard Framework Natural Gas Transmission Usage Agreement (RAE Decision 507/2018 – Government Gazette B’ 2473/27.6.2018) – in force as of June 27, 2018, as well as the Balancing Manual (RAE Decision 546/2018 – Government Gazette B’ 2523/29.6.2018) – in force as of June 29,2018, were issued.

  • Tariff Regulation of Core Activities of the NNGS:

M.D.  4955/2006  (Government Gazette Β’ 360/27.3.2006) on the “Natural Gas Transmission and LNG Re-gasification Tariff“ was issued, which was amended by MDs  Δ1/23344/2006 (Government Gazette Β’ 1781/7.12.2006) and Δ1/5037/2007 (Government Gazette Β’ 379/20.3.2007), and M.D. Δ1/Α/1110/9860/2010 (Government Gazette Β’ 747/31.5.2010) on the Amendment of the Natural Gas Transmission and LNG Re-gasification Tariff, which foresaw tariffs based on exit capacity charges-postage stamp, seized to be in force following the enforcement of the abovementioned NNGS Usage Tariffs, with the explicit exception of the provisions for the calculation of the Recoverable Difference, according to the provisions of article 22 of RAE’s decision No. 594/2012.

RAE’s decision No. 594/2012 (Government Gazette Β’ 2093/5.7.2012) approved the Tariff Regulation of Core Activities of the NNGS, by which a tariff system with independent entry-exit capacity charges was adopted, and RAE’s decision No 722/2012 (Government Gazette Β’ 2385/27.8.12) approved the NNGS Usage Tariffs. The tariff system in question was applicable from February 1, 2013 (replacing M.D. 4955/2006) until December 31, 2016.

The 1st Revision of the Tariff Regulation of the NNGS was approved by virtue of RAE Decision 339/2016 (Government Gazette B’ 3181/4.10.16), while by virtue of RAE Decision 352/2016 (Government Gazette B’ 3513/1.11.16)the corresponding NNGS Usage Tariffs were approved and were applicable from January 1, 2017. The provisions of the aforementioned 1st Revision of the Tariff Regulation are in accordance with the requirements of the framework that has developed according to the existing European Regulations EU 984/2013, EU 312/2014, and EU 703/2015 (see above).

RAE proceeded with the 2nd Revision of the Tariff Regulation of the NNGS with the main purpose being the completion and further improvement of the existing regulatory framework for the conformation of the NNGS Usage Tariffs in accordance with European Regulation (EU) 2017/460 (establishing a network code on harmonized transmission tariff structures for gas) in terms of the need to normalize the continuous variations of tariffs, and in particular the need to prevent extreme fluctuations in the future, but also due to the significant revenue over-recovery of the TSO for 2017. The revision in question was approved by virtue of RAE Decision 871/2017 (Government Gazette B’ 3720/20.10.2017), while by virtue of RAE Decision 997/2017 (Government Gazette B’ 4737/2017.29.12.2017 the revision of the NNGS Usage Tariffs was approved, in accordance with the 2nd Revision of the Tariff Regulation of the NNGS, which are applicable from May 1st, 2018. Subsequently, in July 2018 the 3rd Revision of the Tariff Regulation of the NNGS was issued, which contains intraday capacity products, capacity conversion service (to bundled capacity) and it does not affect the existing tariff usage decision (RAE Dec. 997/2017). The aforementioned revision was approved by virtue of RAE Dec. 644/2018 (Government Gazette Β’ 3000/25.07.2018)and corrective, as per the correction of faults, issue of Government Gazette Β’ 3892/07.09.2018), in force as of July 25th 2018.

In June 2019, RAE Dec. 540/2019 (Government Gazette Β’ 2436/20.06.2019) was published, which approved the Required Revenue for Transmission and LNG regasification and revised the NNGS Usage Tariffs as of September 1st 2019, in the context of the Regular Revision process foreseen in the Tariff Regulation.

By virtue of RAE Dec. 539/2019 (Government Gazette Β’ 2601/28.06.2019), the 4th Revision of the Tariff Regulation of the NNGS was approved, in accordance with the provisions of European Regulation (EU) 2017/460, which contains, inter alia, the conversion of the price reference methodology from postage stamp to Capacity Weighted Distance, the creation of a cluster entry point for Sidirokastro and Kipi, the development of two system exit clusters (North Zone and South Zone, from three already in place), the distinction between Transmission and Non-Transmission Regulated NNGS Services, as well as the distinction between Regulated LNG Services and Additional Regulated LNG Services, as well as the recovery of the Required Revenue for Transmission Services by 50% from Entry Points and 50% from Exit Points (from the existing 80/20 split between Exit and Entry Points. In turn, by virtue of RAE Dec. 566/2019 (Government Gazette Β’ 2724/2.07.2019), the revised NNGS Usage Tariffs were approved, in accordance with the 4th Revision of the Tariff Regulation, in force as of January 1st 2020.

3. Distribution Network Operation

4. Security of Supply

5. Energy Efficiency

Initially, in order for national legislation to comply with Directive 2006/32/EC  on energy end-use efficiency and energy services , L.3855/2010 (Government Gazette 95/23.6.2010) was issued enacting measures for the improvement of end-use energy efficiency, by which M.D. Δ5/Β/29891/2011 (Government Gazette 3254/30.12.2011) was issued enacting the obligations of energy distributors, distribution system operators and retail energy companies for the provision of information on final energy use. Subsequently, since the aforementioned Directive was repealed by Directive 2012/27/EE, the latter’s provisions were incorporated in national legislation by virtue of L.4342/2015 (Government Gazette 143/9.11.2015)By virtue of L. 4342/2015 M.D. 174063/28.03.2017 (Government Gazette B’ 1242/11.04.2017) was issued by which the Regulation for Operation of the Regime for Energy Efficiency Obligation was enacted.
Furthermore, in order for national legislation to comply with Directive 2010/31/EU , L.4122/2013 (Government Gazette A’ 42/19.2.2013) for the Energy Efficiency of Buildings was issued. By virtue of L. 4122/2013, the Inter-ministerial Decision of the Ministers of Finance and Environment & Energy No. ΔΕΠΕΑ 178581 (Government Gazette B’ 2367/12.07.2017) was issued by which the Regulation for Energy Efficiency of Buildings was enacted. As the aforementioned Directive was amended by Directive 2018/844/EU, Member States are obligated to adapt accordingly their national legislation by March 10th 2020.

6. Natural Gas Vehicles / CNG and Transport

A. First of all, by virtue of L.4439/2016 (Government Gazette A’ 222/30.11.2016),Directive 2014/94/EU on the deployment of alternative fuels infrastructure was incorporated into Greek legislation enacting provisions regarding the simplification of the licensing procedure for refueling stations and other provisions relating to Fuel and Energy Supply stations, as well as the promotion of activities of vehicle repair shops related to alternative fuels. Subsequently, the provisions of article 12 (Chapter A’) of L.4233/2014 (Government Gazette A’ 22/29.1.2014) introduced the possibility for the conversion of vehicle engines to dual fuel engines, i.e., for both conventional fuel and compressed natural gas (CNG). By virtue of above provision M.D. No. 10852/715/14/2014 (Government Gazette B’ 1466/05.06.2014) was issued setting the technical specifications for the special equipment necessary for  the use of CNG, as well as all the other terms and conditions for their inspection and safe operation.
Furthermore, M.D. No. 13935/930/2014 (Government Gazette B’ 674/18.3.2014), issued by virtue of article 45 of L. 2773/1999 as in force, set the competent authorities, the terms and conditions for the establishment and operation of CNG distribution and mixed liquid fuel stations.

B. The harmonization of national legislation with Directive 2003/30/EC and the introduction of biofuels in the domestic market was enacted with the necessary amendment and completion of the regulatory framework for petroleum products, i.e. with L.3054/2002 (Government Gazette Α’ 230/2.10.02), L.3423/2005 (Government Gazette Α’ 304/13.12.05), L.3769/2009 (Government Gazette Α’ 105/1.7.09) and L.4062/2012 (Government Gazette Α’ 70/30.3.12).

7. RES and Greenhouse Gas Emissions

A. By virtue of L.4062/2012 (Government Gazette A’ 70/30.3.2012),Directive 2009/28/EC for the promotion of power generation from RES was primarily incorporated into national legislation. The provisions of the currently in force Directive 2018/2001/EU, which repeals the aforementioned Directive as of 1 July 2020, must be incorporated into national law by 30 June 2021.

B. By virtue of Inter-ministerial Decision 48416/2037/E.103 (Government Gazette B’ 2516/7.11.2011) the compliance with the provisions of Directive 2009/31/EC is enacted, concerning the environmentally safe storage of CO2 in the geological formations within Greek territory, including the sea bed, the continental shelf and the subsoil.

C. By virtue of Inter-ministerial Decision 54409/2632 (Government Gazette B’ 1931 /27.12.2004) the compliance with the provisions of Directive 2003/87/EC is enacted, concerning the establishment of a greenhouse gas emission allowance trading scheme.