Gas market liberalization and energy security 2016

Conference report Gas market liberalization and energy security 2016

On December 12, 2016, in Warsaw, the 7th edition of the conference “LIBERALIZATION OF THE GAS MARKET AND ENERGY SECURITY 2016” took place.

The conference is a recurring event held since 2006, dedicated to the liberalization and development of the gas market in Poland and the Central European region.

POLAND’S ENERGY SECURITY VS. EU ENERGY POLICY.

The Polish government and gas companies are implementing subsequent stages of diversifying gas supply sources within the concept of the so-called Northern Gateway. The European Commission’s decision regarding the OPAL gas pipeline greatly complicates Poland’s plans. In the background, work continues on the next EU Winter Package on energy security and the PGNiG–Gazprom arbitration dispute over market gas prices.

In the opening speech of the conference, Mr. Krzysztof Jackowski, Minister’s Advisor and representative of the Government Plenipotentiary for Strategic Energy Infrastructure, presented the government’s strategy and actions to ensure energy security, counteract unfavorable European Commission decisions for Poland, and implement the Northern Gateway concept.

GAS MARKET AND PRICE LIBERALIZATION. THE NEXT STAGE OF GAS MARKET REFORM.

The Parliament passed an amendment to the Energy Law abolishing the obligation to approve gas tariffs. Starting in 2017, successive segments of the market are to be gradually liberalized: the wholesale market, gas purchase at the so-called virtual point (gas exchange), on over-the-counter (OTC) trading platforms, the LNG market, and the CNG market. On the other hand, new regulations are being introduced that hinder gas imports (e.g., new gas storage rules). Gas tariffs for retail customers are to remain in effect until 2024.

Mr. Paweł Pikus from the Ministry of Energy presented the government’s plan for gas market liberalization and the draft of the new diversification regulation.

Attorney Kamil Iwicki from Wawrzynowicz & Partners law firm discussed the regulatory and legal framework for gas market detariffication.

Together with representatives of PGNiG S.A., Gaz-System S.A., industrial gas consumers, and alternative gas suppliers, participants discussed the directions, pace, opportunities, and risks related to detariffication and gas market liberalization.

DEVELOPMENT CONDITIONS OF THE DOMESTIC GAS MARKET. STRATEGIES AND DEVELOPMENT DIRECTIONS OF PGNiG S.A. AND GAZ-SYSTEM S.A.

Vice President of the Management Board of PGNiG S.A., Mr. Maciej Woźniak, presented the company’s strategy and development plans for the coming years, including planned investments in new gas supply sources, PGNiG S.A.’s role in the liberalized gas market, and new products and services offered by PGNiG S.A.

Director of the Development Division at Gaz-System S.A., Mr. Paweł Jakubowski, discussed plans for the expansion of domestic and cross-border transmission infrastructure and the company’s strategy related to the development of the LNG terminal and the Northern Gateway project.

GAS EXCHANGE AND OTC PLATFORMS. HOW TO INCREASE MARKET LIQUIDITY AND COMPETITIVENESS.

Gas market liberalization in 2017 is to include, among other things, the detariffication of gas trading on the exchange and OTC platforms. Ms. Beata Wittmann, Director of the Market Development Department at the Polish Power Exchange (TGE), discussed the impact of new regulations on the development of the gas exchange and OTC platforms, as well as new products and trading rules in these markets.

MAIN TRENDS IN THE EUROPEAN AND GLOBAL GAS MARKETS – IMPACT ON THE DOMESTIC GAS MARKET.

Mr. Mariusz Przybylik from AT Kearney presented an analysis of the main trends in the regional and global gas markets and their impact on the domestic market in the context of the opening of the LNG terminal in Świnoujście and the start of gas market liberalization and detariffication processes.

NEW GAS MARKET RULES. REGULATORY AND LEGAL ASPECTS.

Dr. Paweł Grzejszczak, Partner and Head of the Energy Practice at Domański Zakrzewski Palinka law firm, analyzed the new gas storage rules and their impact on gas imports and the domestic market.

In the regulatory and legal section of the conference, energy lawyers from Bird & Bird – Attorney Andrzej Nentwig, Attorney Andrzej Walkiewicz, and Attorney Łukasz Petelski – discussed the most important changes and new regulations, including:

• abolition of the tariff approval obligation in the amended Energy Law;
• draft of the new diversification regulation;
• changes in the licensing rules for trading in liquid and gaseous fuels, new types of licenses, licensing criteria, and the obligation to provide a deposit;
• new supervisory powers of the President of the Energy Regulatory Office (URE);
• conditions for cross-border gas trade and cooperation with Gaz-System in capacity allocation.

The conference was attended by over 60 senior-level managers representing 24 companies from the gas, energy, fuel, and consulting sectors.

Reports and coverage from the conference appeared in major news agencies (PAP, Bloomberg, ISB News), industry portals (including wnp.pl, cire.pl, biznesalert.pl, energetyka24.com, gazeo.com, CNG-LNG.pl), economic radio services (Polish Radio, Information Radio Agency), national newspaper economic sections, and international media outlets.

The Platinum Partner of the conference was PGNiG S.A. The Gold Partner was GAZ-SYSTEM S.A.

List of companies and institutions participating in the conference