Commission Regulation (EU) 2017/460Show full title

CHAPTER IX U.K. INCREMENTAL CAPACITY

Article 33 U.K. Tariff principles for incremental capacity

1. The minimum price at which transmission system operators shall accept a request for incremental capacity is the reference price. For the calculation of the economic test, reference prices shall be derived by including into the reference price methodology the relevant assumptions related to the offer of incremental capacity.

2. Where the fixed payable price approach set out in Article 24(b) is considered to be offered for incremental capacity, the reserve price referred to in Article 24(b) shall be based on projected investment and operating costs. Once the incremental capacity is commissioned, such reserve price shall be adjusted proportionally to the difference, irrespective whether positive or negative, between the projected investment costs and the actual investment costs.

3. In case the allocation of all incremental capacity at the reference price would not generate sufficient revenues for a positive economic test outcome, a mandatory minimum premium may be applied in the first auction or alternative allocation mechanism in which the incremental capacity is offered. The mandatory minimum premium may also be applied in subsequent auctions when the capacity is offered that initially remained unsold or when capacity is offered that was initially set aside according to Article 8(8) and (9) of Regulation (EU) 2017/459. The decision on whether and in which auctions to apply a mandatory minimum premium shall be taken [F1 by the national regulatory authority].

4. The level of the mandatory minimum premium shall enable a positive economic test outcome with the revenues generated by the offered capacity in the first auction or alternative allocation mechanism in which the incremental capacity is on offer. The range of the level for the mandatory minimum premium, depending on the expected allocated capacity, shall be submitted to the [F2 national regulatory authority] for approval in accordance with Article 25(1)(c) of Regulation (EU) 2017/459.

5. [F3 If a mandatory minimum premium is approved by the national regulatory authority, and by any non-UK regulatory authorities whose approval is required, it] shall be added to the reference price for the bundled capacity products at the respective interconnection point and shall exclusively be attributed to the transmission system operators for which the mandatory minimum premium was approved F4 .... This default principle for the attribution of a mandatory minimum premium is without prejudice to the split of a possible additional auction premium according to Article 21(3) or an alternative [F5 decision by the national regulatory authority, or agreement between the national regulatory authority and any non-UK regulatory authorities whose approval is required].

[F6 6. If the approval of any non-UK regulatory authorities is required, the national regulatory authority must endeavour to cooperate with those non-UK regulatory authorities.

7. If the approval of both national regulatory authorities is required, they must cooperate with each other, and references in paragraphs 3, 4, 5 and 6 to “the national regulatory authority” are to be read as references to “the national regulatory authorities”.]

Textual Amendments

F1 Words in Art. 33(3) substituted (31.12.2020) by The Gas (Security of Supply and Network Codes) (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/531), reg. 1(2), Sch. 5 para. 13(2); 2020 c. 1, Sch. 5 para. 1(1)

F2 Words in Art. 33(4) substituted (31.12.2020) by The Gas (Security of Supply and Network Codes) (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/531), reg. 1(2), Sch. 5 para. 13(3); 2020 c. 1, Sch. 5 para. 1(1)

F3 Words in Art. 33(5) substituted (31.12.2020) by The Gas (Security of Supply and Network Codes) (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/531), reg. 1(2), Sch. 5 para. 13(4)(a); 2020 c. 1, Sch. 5 para. 1(1)

F4 Words in Art. 33(5) omitted (31.12.2020) by virtue of The Gas (Security of Supply and Network Codes) (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/531), reg. 1(2), Sch. 5 para. 13(4)(b) (as amended by S.I. 2019/1393, reg. 1(2), Sch. para. 8); 2020 c. 1, Sch. 5 para. 1(1)

F5 Words in Art. 33(5) substituted (31.12.2020) by The Gas (Security of Supply and Network Codes) (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/531), reg. 1(2), Sch. 5 para. 13(4)(c); 2020 c. 1, Sch. 5 para. 1(1)

F6 Art. 33(6)(7) inserted (31.12.2020) by The Gas (Security of Supply and Network Codes) (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/531), reg. 1(2), Sch. 5 para. 13(5); 2020 c. 1, Sch. 5 para. 1(1)