Public consultation

JSC "Conexus Baltic Grid" launches public consultation on draft Auction rules on ensuring availability of natural gas at the transmission system interconnection with the storage in 2017 – 2018

Historically, the natural gas transmission system in Latvia was designed to ensure large consumption of natural gas, allowing stable supplies for all consumers even during the peak demand under the condition that an appropriate volume of natural gas is injected into Inčukalns underground gas storage (hereafter - IUGS). Without the appropriate stock of natural gas in IUGS, the transmission system operator (hereafter - TSO) is unable to ensure the technical entry capacity at the transmission system interconnection with IUGS which shall correspond to winter daily peak consumption of Latvian consumers.

According to the findings included in the European Commission Joint Research Centre Report evaluating security of supply risks and gas flow scenarios in the region, the minimum volume of natural gas in the IUGS should be in the range of 700 million cubic meters (MCM) at the beginning of the heating season, with additional key volumes of 500 MCM on the 1st of January and 300 MCM on the 1st of March. With the above-mentioned volume of active gas, the TSO is able to ensure the required technical entry capacity at the transmission system interconnection with IUGS throughout the heating season.

Considering the responsibilities of the TSO set by Articles 15(6) and 112 of the Energy law, including responsibility to ensure stability, safety and sustainability of the transmission system and transportation of energy according to demand, the TSO finds that the solution which guarantees 700 MCM natural gas in the IUGS at the beginning of the heating season is the only technically viable solution for 2017/2018 heating season. Other technical solutions of delivery of natural gas via Kotlovka-Kiemenai or Izborsk-Korneti routes, especially during the peak demand and with limited cross-border transmission system capacities, are theoretical and were never used for regular supplies to the Latvian market.

In order to ensure the sustainability and integrity of the transmission system, JSC "Conexus Baltic Grid" as a combined operator of the transmission system and underground gas storage, has chosen the most technically and economically justified solution for ensuring the required technical entry capacity at the transmission system interconnection with IUGS during the forthcoming heating season. The solution entails organizing a public market-based procedure resulting in contractual agreements with the market participants and the TSO on ensuring availability of natural gas at the transmission system interconnection with the IUGS, by injecting the required volume of natural gas into and storing it in the IUGS within the timeframe set by the TSO. The market participants which will be awarded a contract shall be entitled to remuneration set according to the principles foreseen in the Auction rules.

Public consultation on the document will take place from June 12, 2017 till June 23, 2017. Comments shall be submitted electronically to the following e-mail address: [email protected] or in paper form to the following address: A. Briāna street 6, Riga, LV 1001, Latvia.

Public consultation document in English is available here.