Changes from report parliamentary committee draft to plenary report

Added6. The annual accounts shall indicate in notes any transaction of a certain size conducted with related undertakings.

AddedRegulatory Authorities

Added1. Each Member State shall designate a single regulatory authority at national level.

Added2. Paragraph 1 shall be without prejudice to the designation of other regulatory authorities at regional level within Member States, provided that there is one senior representative for representation and contact purposes a Union level within the Board of Regulators of ACER in accordance with Article 7(1) of Regulation (EU) 2019/942.

Added3. By way of derogation from paragraph 1, a Member State may designate regulatory authorities for small systems in a geographically separate region whose consumption, in 2008, accounted for less than 3 % of the total consumption of the Member State of which it is part. That derogation shall be without prejudice to the appointment of one senior representative for representation and contact purposes at Union level within the Board of Regulators of ACER in compliance with Article 7(1) of Regulation (EU) 2019/942.

Added4. Member States shall guarantee the independence of the regulatory authority and shall ensure that it exercises its powers impartially and transparently. For this purpose, Member States shall ensure that, when carrying out the regulatory tasks conferred upon it by this Directive and related legal acts, the regulatory authority:

Added(a) is legally distinct and functionally independent from any other public or private entity;

Added(b) ensures that its staff and the persons responsible for its management:

Added(i) act independently from any market and political interest;

Added(ii) do not seek or take direct instructions from any government or other public or private entity when carrying out the regulatory tasks. That requirement is without prejudice to close cooperation, as appropriate, with other relevant national authorities and consumer representative bodies or to general policy guidelines issued by the government and not related to the regulatory powers and duties under Article 72.

Added5. In order to protect the independence of the regulatory authority, Member States shall in particular ensure that:

Added(a) the regulatory authority can take autonomous decisions, independently from any political body;

Added(b) the regulatory authority has all the necessary human and financial resources it needs to carry out its duties and exercise its powers in an effective and efficient manner;

Added(c) the regulatory authority has a separate annual budget allocation and autonomy in the implementation of the allocated budget;

Added(d) the members of the board of the regulatory authority or, in the absence of a board, the regulatory authority’s top management are appointed for a fixed term of five up to seven years, renewable once.

Added(e) the members of the board of the regulatory authority or, in the absence of a board, the regulatory authority’s top management are appointed based on objective, transparent and published criteria, in an independent and impartial procedure, which ensures that the candidates have the necessary skills and experience for any relevant position in the regulatory authority;

Added(f) provisions on conflict of interest are in place and confidentiality obligations extend beyond the end of the mandate of the members of the board of the regulatory authority or, in the absence of a board, the regulatory authority's top management;

Added(g) the members of the board of the regulatory authority or, in the absence of a board, the regulatory authority's top management may be dismissed only based on transparent criteria in place;

Added(h) Member States may provide for the ex-post control of the regulatory authorities’ annual accounts by an independent auditor.

AddedIn regard to the first subparagraph, point (d), Member States shall ensure an appropriate rotation scheme for the board or the top management. The members of the board or, in the absence of a board, members of the top management may be relieved from office during their term only if they no longer fulfil the conditions set out in this Article or have been guilty of misconduct under national law.

Added6. By 5 July 2022 and every four years thereafter, the Commission shall submit a report to the European Parliament and to the Council on the compliance of national authorities with the principle of independence set out in this Article. The reports shall analyse any non-compliance and shall provide recommendations for resolution. The Commission shall make those reports publicly available.

AddedIn carrying out the regulatory tasks specified in this Directive, the regulatory authority shall take all reasonable measures in pursuit of the following objectives within the framework of their duties and powers as laid down in Article 72, in close consultation with other relevant national authorities, including competition authorities and authorities from neighbouring countries, including third countries, as appropriate, and without prejudice to their competencies:

Added(a) promoting, in close cooperation with regulatory authorities of other Member States, the Commission and ACER, a competitive, flexible, secure and environmentally sustainable internal market in natural gas, renewable gas and low-carbon gas and hydrogen within the Union, and ensuring appropriate conditions for the effective and reliable operation of natural gas and hydrogen networks, taking into account long-term objectives, thus contributing to the consistent, efficient and effective application of Union law in order to achieve the Union’s climate and energy goals;

Added(b) developing competitive and properly functioning regional cross-border markets within the Union in view of the achievement of the objectives referred to in point (a);

Added(c) eliminating restrictions on trade in natural gas and hydrogen between Member States, including eliminating restrictions due to differences in the quality of gas or differences in the volume of hydrogen blended into the natural gas system or to differences in the quality of hydrogen in the hydrogen system, developing appropriate cross-border transmission and/or transport capacities to meet demand and enhancing the integration of national markets ensuring the interoperability of the interconnected EU natural gas system or Union hydrogen system, which may facilitate natural gas flow across the Union;

Added(d) helping to achieve, in the most cost-effective way, the development of secure, reliable and efficient non-discriminatory systems that are consumer oriented, and promoting system adequacy and, in accordance with general energy and climate policy objectives, energy efficiency as well as the integration of large and small scale production of gas from renewable sources and distributed production in both transmission and distribution networks and facilitating their operation in relation to other energy networks of electricity and heat;

Added(e) facilitating connection and access to the network for new production capacity, in particular removing barriers that could prevent connection and access for new market entrants and of gas and hydrogen from renewable sources;

Added(f) ensuring that system operators and system users are granted appropriate incentives, in both the short and the long term, to increase efficiencies, especially energy efficiency, in system performance and foster market integration;

Added(g) ensuring that customers benefit through the efficient functioning of their national market, promoting effective competition and helping to ensure a high level of consumer protection in close cooperation with relevant consumer protection authorities;

Added(ga) where cross-sectoral issues arise, clarifying competencies among regulators and authorities and ensuring that solutions are cost-efficient;

Added(h) helping to achieve high standards of public service for natural gas, contributing to the protection of vulnerable customers and contributing to the compatibility of necessary data exchange processes for customer switching;

Added(ha) ensuring that customers are granted instruments to submit complaints in the case of supply disruptions of natural gas and hydrogen.

Added1. The regulatory authority shall have the following duties:

Added(a) fixing or approving, in accordance with transparent criteria, transmission or distribution tariffs or their methodologies, or both and publishing such tariffs or methodologies together with the relevant assumptions;

Added(aa) fixing or approving, in accordance with transparent criteria, including depreciation, tariff rules;

Added(ab) participating in drafting the joint scenario framework for the ten-year network development plan in accordance with Article 51(2), point (e);

Added(b) as of 1 January 2031 or as from the date of applying Article 31(1), fixing or approving, in accordance with transparent criteria, tariffs for hydrogen network access or their methodologies, or both, and publishing those tariffs or methodologies together with the relevant assumptions;

Added(c) fixing or approving, in accordance with transparent criteria (i) the size and duration of the dedicated charge referred in Article 4 of [recast Gas Regulation as proposed in COM(2021) xxx] or their methodologies, or both (ii) the value of transferred assets and the destination of any profits and losses that may occur as a result and (iii) the allocating contributions to the dedicated charge;

Added(d) ensuring compliance of transmission system operators and distribution system operators, and where relevant, system owners, hydrogen network operators as well as of any natural gas nd hydrogen undertakings and other market participants, ▌with their obligations under this Directive, [the recast Gas Regulation as proposed in COM(2021) xxx], the network codes and guidelines adopted pursuant Article 52 and 53 of Gas Regulation, Regulation (EU) 2017/1938 and other relevant Union law, including as regards cross-border issues, as well as ACER’s decisions;

Added(e) in close coordination with the other regulatory authorities, ensuring the compliance of the ENTSO for Gas, the EU DSO entity and the ENNOH with their obligations under this Directive [recast Gas Regulation as proposed in COM(2021) xxx], the network codes and guidelines adopted pursuant to Articles 52 to 56 of [the recast Gas Regulation proposed in COM(2021) xxx], and other relevant Union law, including as regards cross-border issues, as well as with ACER's decisions, and jointly identifying non-compliance of the ENTSO for Gas, the EU DSO entity and the ENNOH with their respective obligations; where the regulatory authorities have not been able to reach an agreement within a period of four months after the start of consultations for the purpose of jointly identifying non-compliance, the matter shall be referred to the ACER for a decision, pursuant to Article 6(10) of Regulation (EU) 2019/942;

Added(f) monitoring the development of gas qualities and gas quality management by transmission system operators and where relevant by distribution system operators, including monitoring the development of costs related to the management of gas quality by system operators and the developments related to the blending of hydrogen into the natural gas system;

Added(g) monitoring the development of hydrogen quality and hydrogen quality management by hydrogen network operators where relevant as referred to in Article 46, including monitoring the development of costs related to the management of hydrogen quality;

Added▌

Added(i) taking the examination and assessment of the overview of the development of the hydrogen transport infrastructure as requested under point (ee) into account in its approval of dedicated charges within the meaning of Article 4 of [recast Gas Regulation as proposed in COM(2021) xxx];

Added(j) cooperating with regard to cross-border issues with the regulatory authority or authorities of the Member States concerned and with the ACER, in particular through participation in the work of ACER’s Board of Regulators pursuant to Article 21 of Regulation (EU) 2019/942. In respect of infrastructure to and from a third country, the regulatory authority of the Member State where the first interconnection point with the Member States' network is located may cooperate with the relevant authorities of the third country, including those of the Energy Community Contracting Parties, after consulting the regulatory authorities of other Member States concerned, aiming at, as regards that infrastructure, consistent application of this Directive in the territory of the Member States;

Added(ja) ensuring an independent decision-making process, including the consultation of relevant stakeholder in an open, inclusive and transparent manner in accordance with Article 51(8a);

Added(k) complying with, and implementing, any relevant legally binding decisions of ACER and of the Commission;

Added(l) reporting annually on its activity and the fulfilment of its duties to the relevant authorities of the Member States, ACER and the Commission. Such reports shall cover the steps taken and the results obtained as regards each of the tasks listed in this Article;

Added(m) ensuring that there are no cross-subsidies between transmission, distribution, hydrogen transport, natural gas and hydrogen storage, LNG and hydrogen terminals and natural gas and hydrogen supply activities;

Added(ma) monitoring and issuing a report on the unbundling of accounts in accordance with Article 69 where a hydrogen network operator is part of an undertaking active in transmission or distribution of natural gas or electricity, with a specific focus as regards the assets transferred or reused from natural gas accounts to hydrogen accounts and the work, including repurposing, carried out for the purpose of such a transfer, making that report publicly available while preserving the confidentiality of commercially sensitive information and data protection as well as security of the energy infrastructure;

Added(n) monitoring investment plans of the transmission system operators and hydrogen network operators, and providing in its annual report an assessment of the investment plans of the transmission system operators and hydrogen network operators as regards their consistency with the Union -wide network development plan referred to in ▌Article 29 of [recast Gas Regulation as proposed in COM(2021) xxx]; such assessment may include recommendations to amend those investment plans;

Added(o) monitoring compliance with and reviewing the past performance of network security and reliability rules and setting or approving standards and requirements for quality of service and supply or contributing thereto together with other competent authorities;

Added(p) monitoring the level of transparency, including of wholesale prices, and ensuring compliance of natural gas and hydrogen undertakings with transparency obligations;

Added(q) actively monitoring the level and effectiveness of market opening and competition at wholesale and retail levels, including on natural gas and hydrogen exchanges, prices for household customers including prepayment systems, price spikes and their impact on retail and consumer prices, the relationship between household prices and wholesale prices, how network costs and policy levies are passed through to customers, the evolution of supplier operational costs and margins across different final customer groups, the number of tariffs available to different customer groups, number of offers restricted to different sale channels, number of customers on bundled contracts, satisfaction with the service provided by their supplier and complaint handling services, switching rates and switching times, including gas switches, disconnection rates, charges for and the execution of maintenance services, the number of disconnections and the reasons for such disconnections and customers in debt, in particular with regard to vulnerable customers and customers who are affected by or at risk of energy poverty, and complaints by household customers, as well as any distortion or restriction of competition, including providing any relevant information, and bringing any relevant cases to the relevant competition or consumer protection authorities, the share of energy efficiency measures under Article 8 of Directive (EU) .../...+ implemented as a priority in households affected by or at risk of energy poverty and living in social housing;

Added(r) monitoring the occurrence of restrictive contractual practices, including exclusivity clauses which may prevent large non-household customers from contracting simultaneously with more than one supplier or restrict their choice to do so, and, where appropriate, informing the national competition authorities of such practices;

Added(s) respecting contractual freedom with regard to long-term supply and capacity contracts, including hydrogen long-term contracts and hydrogen purchase agreements provided that they are compatible with Union law and consistent with Union policies and provided they contribute to decarbonisation objectives ▌;

Added(t) monitoring the time taken by natural gas transmission and distribution system operators or hydrogen network operators to assess network connection requests by renewable gas producers, including technical studies, and to make connections and repairs for renewable gas producers and end-users;

Added(u) monitoring and reviewing the access conditions to storage, linepack and other ancillary services as provided for in Article 29 or ▌33. In the event that the access regime to natural gas storage is defined pursuant to Article 29(3), that task shall exclude the reviewing of tariffs;

Added(v) ensuring, together with other relevant authorities, that the consumer protection measures, including those set out in Annex I, are effective and enforced through proper monitoring and reporting, such monitoring taking into account consumer interests and, in particular, assessing:

Added(i) the level of debt, in particular with regard to vulnerable customers and customers affected by or at risk of energy poverty, the barriers for customers to exercise their rights, including access to information on out-of-court dispute settlement mechanism, the availability and access to information with regard to energy offers, and possibility to compare energy offers by using certified comparison tools;