PGNiG SA and PGNiG Supply & Trading submitted a request for granting participation in the certification procedure for Nord Stream 2 pipeline operator. This procedure will determine if the pipeline owner will gain a privileged position on the European gas market.
Polskie Górnictwo Naftowe i Gazownictwo S.A. and its German subsidiary PGNiG Supply & Trading GmbH submitted a request to the German regulatory authority – the Federal Network Agency for granting participation in the certification procedure initiated at the request of Nord Stream 2 AG, the owner of the Nord Stream 2 pipeline.
Stream 2 AG does not want to comply with the ground rules of the Third Energy Package, which aim at ensuring competition and level playing field for all market participants. In particular Nord Stream 2 pipeline owner wants to avoid application of requirements concerning ownership unbundling, third party access, and transparent tariffs that should take into account the cost of the whole pipeline. The key factor is also the negative impact of NS2 pipeline on EU and its Member States security of supplies. Those arguments need to be heard. Therefore, PGNiG decided to join the certification procedure conducted by BNetzA as well as to notify its position to the European Commission. Since the Court of Justice issued a verdict in the OPAL case, no one can ignore the energy solidarity principle and overlook the impact of their decisions on the security of other EU Member States anymore. – said Paweł Majewski, President of PGNiG SA Management Board.
Nord Stream 2 AG filed in June 2021 a request for certification under the Independent Transmission Operator (ITO) model. The ITO model certification enables the operator to conduct its activities in spite of lack of full ownership unbundling from the parent-company active in the production and supply of natural gas. In this case – Gazprom. Such unbundling is one of the ground rules of the Third energy Package and aims at guaranteeing equal and transparent rules for competition in the UE gas market. Granting the ITO model certification is only possible for the transmission systems that existed before May 23, 2019, whereas NS2 pipeline was not even built at that date.
Moreover, Nord Stream 2 AG, which is registered in Switzerland, does not fulfill a basic requirement for granting certification. According to the Gas Directive, to be granted a role of the certified transmission system operator, a company has to be registered in one of the EU Member States. It needs to fulfill the specific criteria concerning the corporate structure, which are not fulfilled by the Nord Stream 2 AG. Additionally, for the companies controlled by entities from outside the EU, granting an operator status requires an enhanced certification procedure, which includes a detailed impact analysis of certification for security of supplies. Such a procedure is conducted by the competent authority of a given Member State in cooperation with the Commission. The regulatory authority is obliged to refuse certification that would put at risk the security of energy supply in a given Member State as well as in the EU.
We assess that there are no legal grounds for granting the Swiss company owned by Gazprom a certification and therefore for starting operation by the pipeline. Nord Stream 2 AG request should be rejected for formal and substantial reasons. Security of supplies as well as functioning of the EU internal market are at stake – concluded Paweł Majewski.
Also according to the European Commission’s position the NS2 the pipeline is not in line with the policy objectives of the Energy Union and could allow a single supplier to further strengthen its position. Also in the competition case, carried out by the Commission’s Directorate General for Competition concerning the abuse by Gazprom of its dominant position on the markets of gas supplies to the Central and Eastern European countries. The Commission indicated however that gaining by Gazprom influence on the functioning of the transmission infrastructure has negative consequences for competition.
The ITO model certification request is another attempt by Gazprom and Nord Stream 2 AG to gain a privileged position on the natural gas market in the EU. In a separate proceeding Nord Stream 2 AG requested derogation from the requirements of the Third Energy Package. On August 25, 2021 the Higher Regional Court in Düsseldorf is going to issue a verdict in the derogation case. PGNiG S.A. and PST GmbH as active participants of the derogation proceedings emphasize that granting derogation would be contrary to both the the EU and the German law.