Disputes and other measures

Snam is involved in civil, administrative and criminal cases and legal actions related to its normal business activities. According to the information currently available and considering the existing risks, Snam believes that these proceedings and actions will not have material adverse effects on its consolidated financial statements.

The following is a summary of the most significant proceedings; unless indicated otherwise, no allocation has been made for the litigation described below because the Company believes it improbable that these proceedings will have an unfavourable outcome or because the amount of the allocation cannot be reliably estimated.

Criminal cases

Snam Rete Gas S.p.A. – Judiciary investigations into gas metering

In 2006, the public prosecutor at the Court of Milan opened a criminal case on the issue of gas metering and the legitimacy and reliability of “Venturi meters”. This case involved several companies in the gas sector, including Snam Rete Gas. The company was investigated pursuant to Article 24 and 25-ter of Legislative Decree 231/2001. The notice of conclusion of preliminary investigations was served in November 2009. Some managers and department heads (including some no longer employed by the company) were under investigation with regard to various matters.

The period under investigation is a time span that, in total, covers the years from 2003 to 2007, relating primarily to annual natural gas consumption reports and to assessment and/or payment of excise duties on natural gas, as well as to possible obstruction of supervisory duties. With the help of independent external experts, the administrative, tax and European legislation aspects have been examined more closely. Snam Rete Gas is reassured by the opinions of the experts and maintains that the allegations made are unfounded. The company therefore considers itself unlikely to suffer a subsequent negative economic impact.

On 24 January 2012, the preliminary hearing judge ruled that there was insufficient evidence to proceed to a trial of any of those under investigation and simultaneously ordered the release from seizure of the meters.

The assistant public prosecutor has filed for an appeal before the Court of Cassation at the Court of Milan. The Court of Cassation partially annulled the contested ruling, rejecting the rest of the public prosecutor’s appeal, in particular for the effect of the indictments referred to in Articles 472, paragraphs 1 and 2 of the Criminal Code and Article 2638, paragraph 1 of the Italian Civil Code, and the charge pursuant to Legislative Decree 231/2001.

Following the adjournment implemented by the Court of Cassation, the new preliminary hearing opened on 12 December 2013, following which the preliminary hearing judge ordered committal to trial only for 2006 and 2007. The hearing began on 18 April 2014. At the hearing of 27 March 2015, the Court of Milan absolved the charges against the defendants due to lack of evidence and because it did not constitute an offence. The public prosecutor has appealed.

Snam Rete Gas S.p.A. – Tresana incident

On 18 January 2012, an explosion took place on the La Spezia-Cortemaggiore (Tresana) pipeline during maintenance work being conducted on the line (performed by a subcontractor). Snam Rete Gas took immediate action to provide all the necessary assistance and to ascertain responsibility and the causes of the incident. The gas flow was promptly re-established on the line. After the conclusion of the preliminary investigation, several charges were brought against several managers and directors and as a result of the committal to trial declared by the preliminary hearing judge on 23 June 2015, the proceedings began.

Snam Rete Gas S.p.A. – Pineto incident

The public prosecutor at the Court of Teramo opened an investigation against certain directors, executives and managers(including some no longer employed by the company), in relation to the incident that took place on 6 March 2015 near the town of Pineto (Teramo) involving a gas leak on a section of piping. The causes of the gas leak and fire are currently being investigated. The infrastructure was quickly made safe, stopping the gas leak and facilitating the firefighting operations.

The public prosecutor arranged the removal of the names of several senior positions, believing that in the light of the investigations carried out, the liability of several senior Snam Rete Gas mangers could be excluded.

On 2 February 2017, the notice of conclusion of the preliminary investigations was announced, the accused offences were deemed criminal negligence causing wide-scale disaster and wildfire caused by arson.

Positions within the employer model are still being investigated – Employer, Safety Manager, Safety Officer – and also technical positions. Snam Rete Gas is actively cooperating with the relevant authorities.

Snam Rete Gas – Sestino (AR) incident

The public prosecutor at the Court of Arezzo brought a criminal case against several Snam Rete Gas directors and executives(including some no longer employed by the company), in relation to an event that took place on 19 November 2015 in the municipality of Sestino (AR).

On that date there was a break in the pipeline that caused an uncontrolled gas leak. The reasons for the gas leak and fire are currently being ascertained. Snam Rete Gas is actively cooperating with the relevant authorities.

Snam Rete Gas – Badia Tedalda (AR) criminal proceedings

The public prosecutor at the Court of Arezzo opened criminal proceedings with regard to Snam Rete Gas for an alleged violation of the landscape and environmental protection order with regard to the work of reopening the network for the pipeline in the Municipality of Badia Tedalda (AR), which took place without the necessary permits. The Company is cooperating with the Authorities.

Electricity, Gas and Water Authority (AEEGSI)

Snam Rete Gas S.p.A. Investigation into violations on the subject of natural gas metering with regard to Snam Rete Gas S.p.A and request for information

Through Resolution VIS 97/11, notified on 15 November 2011, the Electricity, Gas and Water Authority (the Authority) started proceedings to look into whether there were any violations with regard to natural gas metering, relating to alleged irregularities in gas metering with reference to 45 plants.

Through its subsequent Resolution 431/2012/S/gas of 25 October 2012, the Electricity and Gas Authority opened further proceedings to determine whether there had been violations with regard to natural gas metering, simultaneously joining with the aforementioned investigative proceedings.

Snam Rete Gas S.p.A. has submitted proposals in relation to the alleged conduct, as well as an update on the situation at the regulating and metering plants in question. By means of Resolution 332/2015/S/gas of 9 July 2015, the Authority declared the proposals to be inadmissible, on the grounds that they would not be adequate to restore the alignment of interests existing before the alleged violations or to eliminate any immediate and direct consequences of these violations.

Snam Rete Gas is awaiting the final order.

Snam Rete Gas S.p.A. – Resolution 608/2015/R/gas – Proceedings to determine the share of costs arising from outstanding receivables owing to the gas balancing supervisor

By way of Resolution 145/2013/R/gas of 5 April 2013, the AEEGSI began “proceedings to determine the share of costs arising from outstanding receivables owing to the gas balancing supervisor for the period 1 December 2011 – 23 October 2012”.

The proceedings in question were triggered by the outcome of the investigation launched through resolution 282/2012/R/gas on the procedures for regulating the economic aspects of balancing and the steps taken to protect the system relating to the period 1 December 2011 – 31 May 2012. This investigation was concluded by way of Resolution 144/2013/E/gas, and the AEEGSI used Resolution 145/2013/R/gas to rule that dedicated proceedings should be opened to determine the share of the costs owing to Snam Rete Gas S.p.A. with regard to “fully outstanding receivables” and to monitor the situation going forward.

Following the investigation, through resolution 608/2015/R/gas of 11 December 2015, the Authority closed the proceedings deciding not to pay the share of the outstanding receivables in relation to which the specific case was the object of the investigation, for the total sum of approximately €130 million including VAT. Lastly, the Authority paid Snam Rete Gas the remaining part of the receivables not collected for the period from 1 December 2011 – 23 October 2012. The Company, believing that the conditions existed for paying the share of expenses resulting from receivables not collected and subject to the proceedings in question, challenged resolution 608/2015/R/gas before the competent legal authorities. The merit hearing took place on 17 January 2017; the decision of the Milan Regional Administrative Court is awaited.

The Company made an allocation to the provision for impairment losses on receivables.

Snam Rete Gas S.p.A. – Resolution 9/2014/S/gas – “Launch of punitive proceedings against Snam Rete Gas S.p.A. for non-compliance with Resolution 292/2013/R/gas”.

By means of Resolution 9/2014/S/gas, published on 27 January 2014, the Authority provided for the launch of punitive proceedings against Snam Rete Gas S.p.A. for non-compliance with Resolution 292/2013/R/gas. The proceedings aim to ascertain whether or not delays exist in provisions relating to the enactment of amendments to the Network Code established by Resolution 292/2013/R/gas, with regard to settlement or determination of the relative physical and financial items of the balancing of the gas system. On 11 July 2016 the Authority announced the findings of the preliminary investigation. Snam Rete Gas asked for the deadlines for submitting its defence.

Snam Rete Gas S.p.A. – Resolution 250/2015/R/gas, published on 1 June 2015 on the: “Adoption of measures on the odorising of gas for domestic use and similar for end users connected directly to the natural gas transportation networks”

Through Resolution 250/2015/R/gas, following the ruling of the Milan regional administrative court, the AEEGSI amended Article 5 of Resolution 602/2013/R/gas dealing with the obligation pursuant to transportation companies to odorise gas for end users connected directly to the transportation network, which, taking into account the categories of use indicated in the TISG, do not use the gas delivered for merely technological purposes. In this regard, the AEEGSI arranged that the transportation companies, after carrying out a survey of the redelivery points involved (by 31 July 2015)) and sending the AEEGSI the adaptation plan (by 30 November 2015), to be updated every six months, with the description of the technical solution identified, should complete the implementation of the adaptation plans by 31 January 2017.

Snam Rete Gas has appealed against the above resolution believing that the deadline for implementing the plan can only be decided after the survey. Having carried out the survey, when sending the plan and the subsequent updates, given the high number of redelivery points involved (more than 1300) and the critical areas that emerged in the implementation of the plan, Snam Rete Gas found that the deadline set by the AEEGSI was unreasonable.

Moreover, through the subsequent Resolution 484/2016/E/gas, entitled: “formal notice to comply with the obligations regarding the odorising of gas for domestic use and similar by end users connected directly to the natural gas transportation networks” the AEEGSI confirmed the deadline of 31 January 2017. Consequently, under the scope of an application through which Snam Rete Gas challenged Resolution 250/2015/R/gas, it submitted an appeal for further grounds against Resolution 484/2016/E/gas asking for the resolutions challenged to be suspended. The application for a suspension, rejected at first by the Milan administrative regional court through ruling no. 1690/2016 of 20 December 2016, was later accepted by the Council of State through the ruling of 23 January 2017. A date is yet to be set for a merit hearing before the Milan regional administrative court.

Cerved Rating Agency S.p.A. and Cerved Group S.p.A. /AEEGSI/Snam Rete Gas S.p.A.

In February 2015, the Cerved Group and Cerved Rating Agency requested, firstly before the Lombardy – Milan administrative regional court, the annulment of AEEGSI Resolution 207/2014/R/gas, because the part in which Cerved is excluded from parties accredited to issue credit ratings guaranteeing the payment of bonds from the transfer and the provision of the gas transportation and balancing service is unlawful.

Through the ruling filed in April 2016, the Lombardy regional administrative court only partly accepted the appeal submitted by Cerved, believing Cerved’s applications with regard to the request to annul the AEEGSI’s resolution to have grounds and therefore the Snam Rete Gas Network Code, in the part in which it does not consider Cerved among the parties entitled to issue credit ratings for the purpose of the Network Code. However, the demand to confirm Cerved’s right to be admitted to the list of parties accredited for issue credit ratings for the purpose of the Network Code was rejected, as was the claim for compensation for damages.

As a result of the ruling, Snam Rete Gas and the AEEGSI, each as far as their area of responsibility is concerned, should evaluate the claim of the plaintiff once again. Moreover, the Council of State was notified of the appeal which is pending. The merit hearing took place on 9 February 2017; the decision of the Council of State is awaited.

Stoccaggi gas Italia S.p.A. – Gas Tera Consortium and Gas Tera Consortium PMI/AEEGSI/Stogit S.p.A.

Through the appeal announced on 15 June 2016, the Gas Tera Consortium and the Gas Tera PMI Consortium challenged Resolution 180/2016/R/gas on “Determinations following the Lombardy administrative regional court ruling no. 1124/2015”, through which the Authority asked Stogit to notify investors pursuant to Legislative Decree 130/2010 of the amounts that were paid through Resolution 144/2014/R/gas by the Authority to the parties to whom the investors had sold the storage capacities for A.T. 2013/2014, in accordance with what was established by Resolution 144/2014/R/gas. The sums were paid by the then Cassa Conguaglio Settore Elettrico (CCSE) to Stogit in December 2014 and then promptly repaid to those with rights according to the above Resolution. According to the reconstruction of the plaintiffs, Stogit paid an apparent creditor, by virtue of Resolution 144/2014/R/gas, which in the meantime was challenged, but not suspended in the trial which concluded with ruling no. 1124/2015 which established that it is the sellers and not the assignees who have the right to collect these sums. The plaintiffs asked for a declaration of invalidity or, alternatively, the annulment of the challenged Resolution, asking to know whether the burden of recovering the payable with regard to third parties where the sum due to the plaintiffs was incorrectly paid was incumbent upon them. The merit hearing took place on 31 January 2017; the decision of the Milan Regional Administrative Court is awaited.

Tax cases

Stoccaggi gas Italia S.p.A. – Registration tax

On 30 November 2012, the Milan branch of Italy’s Revenue Agency served the Company with notice of a tax assessment for the value adjustment of the transfer by Saipem Energy Services S.p.A. to Stogit of its plant operating maintenance business unit. The assessed transfer value was greater than the declared value owing to a higher goodwill calculation, resulting in an additional figure of approximately €88,000 in registration tax, plus fines and interest.

Pursuant to Article 12 of Legislative Decree No. 218/1997, the Company responded to this order by submitting a tax settlement proposal with a view to establishing whether the grounds exist to definitively resolve the matter. This proposal was not accepted.

The Company has therefore submitted a joint appeal with Saipem S.p.A. to the Milan provincial tax commission, opposing the Milan branch of the Revenue Agency.

On 18 September 2014, the appeal was processed by the Milan provincial tax commission, which issued a ruling upholding the appeal on 2 October 2014.

On 19 March 2015, the Revenue Agency(Provincial Office II – Milan) brought an appeal before the regional tax commission and the Company, in consortium with Saipem S.p.A., appeared before the court.

On 19 March 2016 there was a hearing to discuss the appeal at the regional tax commission. The ruling has not yet been filed.

The allocation made by the Company to the provision for risks and charges in 2012 remains unchanged.

Stoccaggi gas Italia S.p.A. – Payment notice for registration tax

On 4 March 2015, the Revenue Agency issued Stogit S.p.A. with a payment notice requesting payment of the total sum of approximately €2.7 million in tax, relating mainly to registration tax for legal deeds.

The Company brought an appeal before the provincial tax commission of Milan, requesting that the tax be redetermined.

By means of the internal review provision No 55/2015, the Revenue Agency, in accepting the request, corrected the contested notice from €2.7 million to €0.4 million, in addition to service fees, which the company paid on 4 May 2015.

The hearing before the Milan provincial tax commission to deal with the dispute was held on 9 February 2017. The ruling of the commission’s is awaited.

GNL Italia S.p.A. – Local duties

In 2016, with regard to the Panigaglia plant, the Municipality of Portovenere issued TARSU adjustment notices for 2012 and TARES notices for 2013 (approximately €180 thousand), as well as TARI notices for 2015 (approximately €63 thousand).

The notices involve the industrial areas where the Company disposes of its special waste and were therefore challenged with appeals at the La Spezia provincial tax commission.

The hearing to deal with the dispute for the 2015 TARI notices was held on 24 February 2017. The ruling of the commission’s is awaited.

Also note that a similar notice of investigation, issued by the Municipality of Portovenere in 2015 for the 2014 TARSU (approximately €58 thousand) was cancelled by the La Spezia provincial tax commission through a ruling on 05/05/2016; however, the allocated provision, which took place in 2015, was not transferred because the Municipality of Portovenere submitted an appeal to the Liguria regional tax commission.

Recovering receivables from certain users of the transportation and balancing system

The balancing service ensures that the network is safe and that costs are correctly allocated between the market operators. Balancing has both a physical and a commercial purpose. The physical balancing of the system consists of the set of operations through which the Dispatching department of Snam Rete Gas controls flow parameters (capacity and pressure) in real time in order to ensure that gas can move safely and efficiently from injection points to withdrawal points at all times. Commercial balancing consists of the activities required to correctly schedule, account for and allocate the transported gas, as well as the fee system that encourages users to maintain a balance between the volumes they inject into and withdraw from the network.

Pursuant to the current balancing regime, which was introduced by Resolution ARG/gas 45/11 and came into effect on 1 December 2011, in its role as Balancing Supervisor, Snam Rete Gas must ensure that it procures the quantities of gas required to balance the system and offered on the market by users through a dedicated platform of the Energy Market Operator, and, accordingly, it must financially settle the imbalances of individual users by buying and selling gas on the basis of a benchmark unit price (the “principle of economic merit”). The Company must also ensure that it recovers sums owed for the settlement of imbalances from any defaulting users.

a) Unpaid receivables relating to the period from 1 December 2011 to 23 October 2012

The initial regulation laid down by the Authority with Resolution ARG/gas 155/11 stated that users had to provide specific guarantees to cover their exposure and, where Snam Rete Gas had performed its duties diligently and had not been able to recover the costs related to provision of the service, these costs would have been recovered through a special fee determined by the Authority. This Resolution, with reference to the income statement items pertaining to the balancing system, stipulated that the Balancing Supervisor would receive from the Electricity Equalisation Fund (as of 1 January 2016, the Energy and Environmental Services Fund, CSEA) the value of receivables unpaid by the end of the month following the month in which notification was given⁴⁴.

Through its subsequent Resolution 351/2012/R/gas⁴⁵, the Authority ordered, with effect from 1 October 2012, the application of the variable unit fee CV^BL to cover uncollected receivables, and the payment of the expenses to be recovered in monthly instalments of up to €6 million over a minimum of 36 months.

Through Resolution 282/2012/R/gas, as subsequently amended by Resolution 444/2012/R/gas, the Authority opened an exploratory investigation into balancing service provision methods for the period 1 December 2011 – 23 October 2012⁴⁶. The investigation was closed by Resolution 144/2013/E/gas of 5 April 2013. On the same date, the Authority: (i) adopted Resolution 145/2013/R/gas, through which it opened proceedings to determine the share of costs arising from uncollected receivables owing to the gas balancing supervisor for the period 1 December 2011 – 23 October 2012; and (ii) opened six proceedings aimed at establishing whether there have been violations regarding the natural gas balancing service⁴⁷.

With regard to the preliminary investigation discussed in point (i) above, the proceedings were closed by means of Resolution 608/2015/R/gas, with which the Authority decided not to pay a share of the uncollected receivables in relation to specific cases analysed in the preliminary investigation, in any case subject to Snam Rete Gas’s right to withhold the receivables relating to the income statement entries on balancing, possibly already recuperated. The Company challenged Resolution 608/2015/R/gas, before the competent judicial Authority.

During the above-mentioned investigation period, Snam Rete Gas, having terminated the transportation contracts of the six users involved in the aforementioned proceedings since they either defaulted on payments or failed to comply with the balancing obligations set forth in the industry regulations and the Network Code, initiated steps to recover the receivables relating to income statement items arising from commercial balancing operations entrusted to Snam Rete Gas in its capacity as Balancing Supervisor, and also relating to the transportation service.

Specifically, the competent judicial authorities issued 11 provisional executive orders, of which six related to receivables arising from the balancing service and five to receivables arising from the transportation service⁴⁸. Having received these orders, Snam Rete Gas initiated the necessary executive proceedings, which resulted in the recovery of negligible amounts of the overall debt of the users, partly because of the bankruptcy procedures under way at all of these users.

In particular, at present:

• four Users were declared bankrupt. With regard to all four User, Snam Rete Gas obtained measures for admission to the list of creditors for the receivable owed, plus interest;
• two Users applied for composition procedures. For the first user, the judicial authority issued a provision of composition with creditors⁴⁹. With regard to the second, the proceedings pursuant to Article 173 L.F. have just concluded with the application to dismiss being rejected and the user filed a new arrangement proposal which has yet to be put to a vote by the creditors⁵⁰.

b) Unpaid receivables after 23 October 2012

Two additional transportation contracts were terminated in 2013. In relation to one user, the Court of Milan issued a provisional executive injunction ordering the user to pay Snam Rete Gas a total of around €14 million, plus interest and expenses, in relation to the balancing service. The executive procedures initiated resulted in the recovery of around €500 thousand. The user appealed against the injunction, submitting a counterclaim requesting compensation for alleged damage suffered. Moreover, recently, the ruling was declared lapsed with the consequent consolidation of the securities purchased by Snam Rete Gas.

Two provisional executive injunctions were issued in relation to a second user. The first concerned the balancing service, for a sum of around €700 thousand, while the other related to the transportation service, for approximately €4.5 million. As a result, proceedings were launched to implement the injunctions, in response to which the user appealed but did not bring a counterclaim. For this reason, the user was recently declared bankrupt⁵¹.

In 2014, another transportation contract was terminated in relation to a user that had failed to pay outstanding balancing service invoices in the amount of around €75 thousand and transportation service invoices worth approximately €180 thousand. As a result, Snam Rete Gas initiated debt recovery measures, having recently obtained two provisional executive injunctions. For this reason, the user was declared bankrupt⁵².

Lastly, two provisional executive injunctions were recently issued with regard to a user that had failed to pay outstanding balancing service invoices in the amount of around €95 thousand and transportation service invoices worth approximately €860 thousand.

Snam Rete Gas, as stated in the provisional executive injunctions issued by the Court, has engaged in proper conduct and complied with the provisions of the transportation contract, the Network Code and, more generally, the applicable legislation.

Finally, it should be noted that, in terms of the preliminary investigation, on 12 February 2016 the public prosecutor at the Court of Milan ordered the urgent preventive seizure of the moveable and fixed assets belonging to companies and attributable in various guises to the above-mentioned five users. This criminal proceeding resulted in the formal complaint report (and subsequent supplementary reports) filed by Snam Rete Gas, as offended party, in October 2012 for the crimes of falsehood and aggravated fraud. At present, the Company is still the offended party of the crime.

Recovering receivables from users of the storage system

Withdrawals made from strategic storage by three users, invoiced by Stogit and not replenished by the user under the terms specified by the Storage Code

Following withdrawals from strategic storage made by a user in November and December 2010, in 2012 Stogit asked for and obtained an injunction with regard to the sums due that the user failed to pay. The provisional enforceability was confirmed during the opposition launched by the opposing party. Executive actions were launched.

Following the withdrawals and the failed reintegration of the strategic gas in January, February and March 2011 as well, in 2013 Stogit requested and obtained a second provisional executive injunction for the further sums accrued.

Urgent proceedings were also launched for the reintegration of all the gas unlawfully withdrawn, concluding with the conviction of the debtor, with the subsequent application for injunctive relief also being rejected.

The above rulings were later combined.

In September 2012 the Court of Asti admitted the above user together with another two users (who also defaulted with regard to Stogit) in proceedings for an arrangement with creditors. Under the terms and conditions established by the court-appointed receiver, Stogit formally transmitted and documented the amounts of its receivables with these users.

Moreover, following the sub-proceedings to dismiss the arrangement, in November 2013 the Court of Asti declared two of the above-mentioned users bankrupt. In both cases, Stogit promptly filed a proof of claim. Following the examination of the list of creditors, Stogit’s receivables were admitted in full.

However, the procedure for an arrangement with creditors is continuing with regard to the third user, which was approved by way of an order issued by the Court of Asti on 2 July 2014. In reference to the approval decree, against which an appeal was brought by one of the creditors, the Court of Appeal of Turin issued a ruling, confirming the approval of the arrangement with creditors. An appeal brought by the aforementioned creditor is currently pending before the Court of Cassation.

Withdrawals made from strategic storage by a user, invoiced by Stogit and not replenished by the user under the terms specified by the Storage Code, ascribable to the 2010-2011 and 2011-2012 thermal years

Stogit filed with the Civil Court of Milan for a payment injunction provisionally enforceable against one user.

At present, following the partial restitution of gas in the wake of legal action brought, Stogit is still owed approximately 23.6 million SCM.

Stogit promoted the appropriate executive measures.

Through a ruling made on 4 March 2015, the Court of Rome declared the user bankrupt. Stogit therefore initiated proceedings to prove the receivable was owed to it, in compliance with the timeline indicated. The receivable was declared unsecured by the presiding judge.

Withdrawals made from strategic storage by a user, invoiced by Stogit and not replenished by the user under the terms specified by the Storage Code, ascribable to October and November 2011

Stogit filed with the Civil Court of Milan for a payment injunction provisionally enforceable.

Pending the proceedings, the Court of Rome declared the user bankrupt on 30 October 2014. As a result the Civil Court of Milan declared the interruption of Stogit’s legal action and Stogit then initiated proceedings to prove the receivables owed to it in compliance with the timeline indicated. The receivable was declared unsecured by the presiding judge.

At present, following the partial restitution of gas in the wake of legal action brought because of improper withdrawals, Stogit is still owed approximately 56.0 million SCM.

Emissions trading

1 January 2013 was the start of the third regulatory period (2013-2020) of the Emission Trading System (ETS), the greenhouse gas emission allowance system governed by Legislative Decree 30 of 13 March 2013, as amended, and transposing Directive 2009/29/EC. The reduction of CO₂ emissions comes under the objectives set by the European Union in the 2020 Climate and Energy Package, approved in 2009, which involves reducing greenhouse gas emissions by 20% (compared with 1990 levels) by 2020, increasing the share of energy produced from renewable sources by 20% and improving energy efficiency by 20%.

In 2016 the free allocation for the Snam Group was equal to around 207,000 shares, with a decrease of approximate 13% compared with 2015. The reduction was due in part to the progressively decreasing allocation of the free shares on the part of the competent national authority, established for the third regulatory period by Article 10- bis of Directive 2009/29/EC, and in part by lower consumption recorded over the course of 2015.

In 2016, carbon dioxide emissions of the Snam Group facilities covered by the ETS were overall greater than the emission permits allocated. In view of 0.550 million tonnes of carbon dioxide emitted into the atmosphere, around 0.207 million tonnes were allocated, resulting in a 0.343 million-tonne deficit. This deficit is offset by the allowances already present in the registers for Snam Group plants, accumulated thanks to the surplus from previous years.