Regulations for business sectors

Tariff regulations for 2017

By means of Resolution 669/2016/R/gas, published on 17 November 2016, the Authority approved the revenue recognised for the natural gas transportation and dispatching service for 2017.Revenue recognised for the natural gas transportation, dispatching and metering service for 2017 amounted to €1,880 million. The RAB as at 31 December 2015 for transportation, dispatching and metering activities amounted to €15 billion. By means of the subsequent Resolution 776/2016/R/gas, published on 28 December 2016, the Authority definitively approved the transportation, dispatching and metering tariffs for 2017, as calculated based on the recognised revenue approved by Resolution 669/2016/R/gas.

Regulation transition period 2018-2019

Criteria for adjusting the tariffs for natural gas transport services for the transition period in the years 2018 and 2019

By means of Resolution 575/2017/R/gas, which was issued on 04 August 2017, the Authority approved the tariffs for the transport, dispatch and metering service for 2018 -2019.The resolution confirmed the main criteria of the regulation currently in force, with some modifications:

• The current asset β parameter was confirmed for the Transitional Period 2018-2019.The WACC value of 5.4% in real pre-tax terms was therefore confirmed for 2018, and will be determined for the year 2019 by updating the basic parameters;
• From 2018 the investments made in the year t-1 will be included in the investment capital for the purpose of determining the tariffs for year t, replacing the 1% increase in the WACC to cover the regulatory time-lag. The 1% increase in the WACC covering the regulatory time-lag has been applied to investments made in the period 1 January 2014 – 31 December 2016;
• The current input-based incentive scheme (1-2% for 7/10 years for regional and national networks respectively) will be applied to new development investments that have entered into service by 31 December 2017;
• An input-based incentive scheme (1% for 12 years for regional and national networks) will be applied to investments for the construction of new transportation capacity, launched as of 31 December 2017, which will start operating in the years 2018 and 2019.The incentive will also be recognised for investments that start operating during the transition period after 1 January 2018, included in the Development Plan and with a benefit-cost ratio higher than 1.5;
• The operating costs recognised in the fourth regulatory period will be updated according to inflation, and a productivity recovery factor (X-factor).The variable unit price (CV) will be calculated for the years 2018 and 2019 using a reference volume of 67.2 billion cubic metres.

Tariff regulations for 2018

By means of Resolution 757/2017/R/gas, published on 17 November 2017, the Authority approved the revenue recognised for the natural gas transportation and dispatching service for 2018.Revenue recognised for the natural gas storage service for 2018 amounted to € 1,947 million. The RAB used to calculate 2018 revenues for transport, dispatching and measurement activities was 16 billion euros, and included the investments made in 2017.

By means of Resolution 795/2017/R/gas, published on 05 December 2017, the Authority approved the proposed revenue for the natural gas transportation and dispatching service for 2018.

Other provisions

Snam Rete Gas – Regulation criteria for natural gas transportation and despatch tariffs for the 2014-2017 period

Under ruling no. 3735/2015 the State Council confirmed sentence 1729/2014 of the TAR of Milan regarding the partial annulment of the resolutions of the Regulatory Authority (then AEEGSI, ARERA since 1 Januarly 2018) no. 514/2013/R/gas, and of subsequent Resolutions 603/2013/R/gas and 641/2013/R/com, due to the lack of any provision in the relevant rules for a decreasing-scale mechanism for the benefit of end-users with high levels of gas consumption.

By means of Resolution 429/2015/R/gas, the AEEGSI launched a procedure, which should have been completed by 31 December 2015, to comply with the aforementioned ruling. In the meantime, the original appellants submitted an application for compliance with the aforementioned ruling before the competent judicial authority. With non-definitive ruling no. 883/2017, the TAR Milan upheld the appeal by ordering the Authority to provide, within sixty days, conclusion of the procedure initiated by Resolution 429/2015/R/gas. In order to verify fulfilment of the provisions in the non-definitive ruling, continuation of proceedings was therefore postponed until 13 July 2017 during which the applicants – after the approval of AEEGSI Resolution 512/2017/R/GAS – formally withdrew the appeal. As a result, in a later ruling 1648/2017, the TAR declared the appeal inadmissible due to the lack of interest.

Snam Rete Gas – Regulation criteria for natural gas transportation and dispatching tariffs for the period 2010-2013

By means of Ruling 2888/2015, the State Council rejected the appeal filed by AEEGSI for a review of the ruling of the TAR Milan No. 995/2013, which had annulled the provisions contained in Resolutions ARG/gas/184/09, 192/09, 198/09 and 218/10 regarding natural gas transportation and dispatch tariffs for the period 2010-2013 relating, specifically, to the commodity/capacitydistribution, reform of the entry/exit model and gas intended for consumption by the central compressor stations (self-consumption).

By means of Resolution 428/2015/C/gas, the Authority decided to file an appeal for the aforementioned ruling to be overturned on the grounds of factual errors, which will be discussed at the hearing of 29 March 2018.At the same time, the Authority – as a result of the proceedings brought by Resolution 430/2015/R/gas – complied with the aforementioned rulings under Resolution 550/2016/R/gas, with which the Authority, having reformed the rules for self-consumption, justifiably confirmed the pricing criteria for the rest, in the light of consultations carried out.

Given the confirmatory nature of the aforementioned resolution, the original applicant filed an appeal for compliance with the aforementioned rulings and a declaration of the nullity of 550/2016/R/gas. With ruling no. 494/2017, the T.A.R. Milan partially heard the appeal with specific reference to the issues of commodity/capacity distribution, believing that with Resolution 550/2016/R/Gas, there has been an inaccurate and partial compliance with ruling 995/2013 and that, therefore, the Authority should carry out an additional assessment of the effects of the decisions made.

The ruling no. 494/2017 was contested by the appellant, as well as, incidentally, by the AEEGSI. The appeals were discussed before the Council of State at the hearing on 30 November 2017. We are awaiting the ruling.