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Regulation: electricity and gas

As for regulatory developments, the principal new items involve the gas sector. With its Decision No. ARG/gas 64/09, the Gas and Electricity Authority (AEEG) approved the Consolidated Law on Gas (TIVG), which combined and rationalized the regulations of the market for selling natural gas to final customers entitled to consumer protection. In overall continuity with the past, new items introduced included: gradual restriction of the context for applying consumer protection, which from 30 September 2010 will involve only residential final customers; confirmation of the criteria for existing levels and calculating the Wholesale Marketing Component (CCI), and an increase in the tariff schedule to cover the costs of Retail Sales marketing (QVD).

Operators welcomed these new provisions, because they are expected to create sufficient manoeuvring room to resume competition on the natural gas retail market, which in recent years has come to a halt.

With its Decision No. ARG/gas 79/09, the AEEG approved mandatory tariffs for the distribution of natural gas for 2009-2012. In order to reduce the tariff increase from the implementation of Decision No. ARG/gas 159/08, in defining the mandatory tariffs, the AEEG extended the application of the smoothing coefficient to that part of the tariff that covers depreciation; the Decision had expressly covered only capital costs. Another anomaly is the deferral of the finalization of tariff limits for each operator, which will be finalized by 31 December 2009. Approval of the reference tariffs will be subject to inspections to ascertain the correctness and truthfulness of the data provided by the operators for the purpose of determining the tariffs.

Across the gas and electricity sectors, the regulations governing unbundling in Decision No. 11/07 were the subject of a complex lawsuit, which among other things involved a recent ruling by the Lombardy Administrative Tribunal (TAR Lombardia). In ruling against the effectiveness of Decision No. ARG/comm 132/08 defining guidelines for the implementation of unbundling, the TAR confirmed the rulings of the Council of State, which at the time annulled Decision No. 11/07.

In summary, three aspects of the regulation are affected by the lawsuit: inclusion of the measurement of gas in the division of functions, which was ruled unjustified; the inclusion of some management positions of the independent operator, about which a final ruling by the AEEG is still pending; the pervasiveness of the Guidelines on the subject of performance by the Independent Operator, which was considered excessive.

 
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