Regulation (EU) 2017/1938 of the European Parliament and of the CouncilShow full title

Article 1 U.K. Subject matter

This Regulation establishes provisions aiming to safeguard the security of gas supply in the Union by ensuring the proper and continuous functioning of the internal market in natural gas (‘gas’), by allowing for exceptional measures to be implemented when the market can no longer deliver the gas supplies required, including solidarity measure of a last resort, and by providing for the clear definition and attribution of responsibilities among natural gas undertakings, the Member States and the Union regarding both preventive action and the reaction to concrete disruptions of gas supply. This Regulation also establishes transparent mechanisms concerning, in a spirit of solidarity, the coordination of planning for, and response to, emergencies at national, regional and Union level.

Article 2 U.K. Definitions

For the purposes of this Regulation, the following definitions apply:

(1)

‘security’ means security as defined in point 32 of Article 2 of Directive 2009/73/EC;

(2)

‘customer’ means customer as defined in point 24 of Article 2 of Directive 2009/73/EC;

(3)

‘household customer’ means household customer as defined in point 25 of Article 2 of Directive 2009/73/EC;

(4)

‘essential social service’ means a service related to healthcare, essential social care, emergency, security, education or public administration;

(5)

‘protected customer’ means a household customer who is connected to a gas distribution network and, in addition, where the Member State concerned so decides, may also mean one or more of the following, provided that enterprises or services as referred to in points (a) and (b) do not, jointly, represent more than 20 % of the total annual final gas consumption in that Member State:

(a)

a small or medium-sized enterprise, provided that it is connected to a gas distribution network;

(b)

an essential social service, provided that it is connected to a gas distribution or transmission network;

(c)

a district heating installation to the extent that it delivers heating to household customers, small or medium-sized enterprises, or essential social services, provided that such installation is not able to switch to other fuels than gas;

(6)

‘solidarity protected customer’ means a household customer who is connected to a gas distribution network, and, in addition, may include one or both of the following:

(a)

a district heating installation if it is a protected customer in the relevant Member State and only in so far as it delivers heating to households or essential social services other than educational and public administration services;

(b)

an essential social service if it is a protected customer in the relevant Member State, other than educational and public administration services;

(7)

‘competent authority’ means a national governmental authority or a national regulatory authority designated by a Member State to ensure the implementation of the measures provided for in this Regulation;

(8)

‘national regulatory authority’ means a national regulatory authority designated in accordance with Article 39(1) of Directive 2009/73/EC;

(9)

‘natural gas undertaking’ means natural gas undertaking as defined in point 1 of Article 2 of Directive 2009/73/EC;

(10)

‘gas supply contract’ means gas supply contract as defined in point 34 of Article 2 of Directive 2009/73/EC;

(11)

‘transmission’ means transmission as defined in point 3 of Article 2 of Directive 2009/73/EC;

(12)

‘transmission system operator’ means transmission system operator as defined in point 4 of Article 2 of Directive 2009/73/EC;

(13)

‘distribution’ means distribution as defined in point 5 of Article 2 of Directive 2009/73/EC;

(14)

‘distribution system operator’ means distribution system operator as defined in point 6 of Article 2 of Directive 2009/73/EC;

(15)

‘interconnector’ means interconnector as defined in point 17 of Article 2 of Directive 2009/73/EC;

(16)

‘emergency supply corridors’ means Union gas supply routes that help Member States to better mitigate the effects of potential disruption of supply or infrastructure;

(17)

‘storage capacity’ means storage capacity as defined in point 28 of Article 2 of Regulation (EC) No 715/2009;

(18)

‘technical capacity’ means technical capacity as defined in point 18 of Article 2 of Regulation (EC) No 715/2009;

(19)

‘firm capacity’ means firm capacity as defined in point 16 of Article 2 of Regulation (EC) No 715/2009;

(20)

‘interruptible capacity’ means interruptible capacity as defined in point 13 of Article 2 of Regulation (EC) No 715/2009;

(21)

‘LNG facility capacity’ means LNG facility capacity as defined in point 24 of Article 2 of Regulation (EC) No 715/2009;

(22)

‘LNG facility’ means LNG facility as defined in point 11 of Article 2 of Directive 2009/73/EC;

(23)

‘storage facility’ means storage facility as defined in point 9 of Article 2 of Directive 2009/73/EC;

(24)

‘system’ means system as defined in point 13 of Article 2 of Directive 2009/73/EC;

(25)

‘system user’ means system user as defined in point 23 of Article 2 of Directive 2009/73/EC;

(26)

‘ancillary services’ means ancillary services as defined in point 14 of Article 2 of Directive 2009/73/EC.

Article 3 U.K. Responsibility for the security of gas supply

1. The security of gas supply shall be the shared responsibility of natural gas undertakings, Member States, in particular through their competent authorities, and the Commission, within their respective areas of activity and competence.

2. Each Member State shall designate a competent authority. The competent authorities shall cooperate with each other in the implementation of this Regulation. Member States may allow the competent authority to delegate specific tasks set out in this Regulation to other bodies. Where competent authorities delegate the task of declaring any of the crisis levels referred to in Article 11(1), they shall do so only to a public authority, a transmission system operator or a distribution system operator. Delegated tasks shall be performed under the supervision of the competent authority and shall be specified in the preventive action plan and in the emergency plan.

3. Each Member State shall, without delay, notify the Commission, and make public, the name of its competent authority and any changes thereto.

4. When implementing the measures provided for in this Regulation, the competent authority shall establish the roles and responsibilities of the different actors concerned in such a way as to ensure a three-level approach which involves, first, the relevant natural gas undertakings, electricity undertakings where appropriate, and industry, second, Member States at national or regional level, and third, the Union.

5. The Commission shall coordinate the action of the competent authorities at regional and Union levels, pursuant to this Regulation, inter alia, through the GCG or, in particular, in the event of a regional or Union emergency pursuant to Article 12(1), through the crisis management group referred to in Article 12(4).

6. In the event of a regional or Union emergency, the transmission system operators shall cooperate and exchange information using the ReCo System for Gas established by ENTSOG. ENTSOG shall inform the Commission and the competent authorities of the Member States concerned accordingly.

7. In accordance with Article 7(2), major transnational risks to the security of gas supply in the Union are to be identified and risk groups are to be established on that basis. Those risk groups shall serve as the basis for enhanced regional cooperation to increase the security of gas supply and shall enable agreement on appropriate and effective cross-border measures of all Member States concerned within the risk groups or outside the risk groups along the emergency supply corridors.

The list of such risk groups and their composition are set out in Annex I. The composition of the risk groups shall not prevent any other form of regional cooperation benefiting security of supply.

8. The Commission is empowered to adopt delegated acts in accordance with Article 19 in order to update the composition of the risk groups set out in Annex I by amending that Annex in order to reflect the evolution of the major transnational risks to the security of gas supply in the Union and its impact on Member States, taking into account the result of Union-wide simulation of gas supply and infrastructure disruption scenarios carried out by ENTSOG in accordance with Article 7(1). Before proceeding to the update, the Commission shall consult the GCG in the setting provided for in Article 4(4) on the draft update.

Article 4 U.K. Gas Coordination Group

1. A Gas Coordination Group (GCG) shall be established to facilitate the coordination of measures concerning the security of gas supply. The GCG shall be composed of representatives of the Member States, in particular representatives of their competent authorities, as well as the Agency for the Cooperation of Energy Regulators (the ‘Agency’), ENTSOG and representative bodies of the industry concerned and those of relevant customers. The Commission shall, in consultation with the Member States, decide on the composition of the GCG, ensuring it is fully representative. The Commission shall chair the GCG. The GCG shall adopt its rules of procedure.

2. The GCG shall be consulted and shall assist the Commission in particular on the following issues:

(a) the security of gas supply, at any time and more specifically in the event of an emergency;

(b) all information relevant to the security of gas supply at national, regional and Union level;

(c) best practices and possible guidelines to all the parties concerned;

(d) the level of the security of gas supply, benchmarks and assessment methodologies;

(e) national, regional and Union scenarios and testing the levels of preparedness;

(f) the assessment of the preventive action plans and the emergency plans, the coherence across the various plans, and the implementation of the measures provided for therein;

(g) the coordination of measures to deal with an Union emergency, with the Energy Community Contracting Parties and with other third countries;

(h) assistance needed by the most affected Member States.

3. The Commission shall convene the GCG on a regular basis and shall share the information received from the competent authorities whilst preserving the confidentiality of commercially sensitive information.

4. The Commission may convene the GCG in a setting which is restricted to the representatives of the Member States and in particular of their competent authorities. The Commission shall convene the GCG in this restricted setting if so requested by one or more of the representatives of the Member States and in particular of their competent authorities. In this case, Article 16(2) shall not apply.

Article 5 U.K. Infrastructure standard

1. Each Member State or, where a Member State so provides, its competent authority shall ensure that the necessary measures are taken so that in the event of a disruption of the single largest gas infrastructure, the technical capacity of the remaining infrastructure, determined in accordance with the N – 1 formula as set out in point 2 of Annex II, is able, without prejudice to paragraph 2 of this Article, to satisfy total gas demand of the calculated area during a day of exceptionally high gas demand occurring with a statistical probability of once in 20 years. This shall be done taking into account gas consumption trends, the long-term impact of energy efficiency measures and the utilisation rates of existing infrastructure.

The obligation set out in the first subparagraph of this paragraph shall be without prejudice to the responsibility of the transmission system operators to make the corresponding investments and to the obligations of transmission system operators as laid down in Regulation (EC) No 715/2009 and Directive 2009/73/EC.

2. The obligation to ensure that the remaining infrastructure has the technical capacity to satisfy total gas demand, as referred to in paragraph 1 of this Article, shall also be considered to be fulfilled where the competent authority demonstrates in the preventive action plan that a disruption of gas supply may be sufficiently compensated for, in a timely manner, by appropriate market-based demand-side measures. For that purpose, the N – 1 formula shall be calculated as set out in point 4 of Annex II.

3. Where appropriate, in accordance with the risk assessments referred to in Article 7, the competent authorities of neighbouring Member States may agree to fulfil, jointly, the obligation set out in paragraph 1 of this Article. In such case the competent authorities shall provide in the risk assessment the calculation of the N – 1 formula together with an explanation in the regional chapters of the preventive action plans how the agreed arrangements fulfil that obligation. Point 5 of Annex II shall apply.

4. The transmission system operators shall enable permanent physical capacity to transport gas in both directions (‘bi-directional capacity’) on all interconnections between Member States, except:

(a) in the case of connections to production facilities, to LNG facilities and to distribution networks; or

(b) where an exemption from that obligation has been granted, after detailed assessment and after consulting other Member States and with the Commission in accordance with Annex III.

For the procedure to enable or enhance bi-directional capacity on an interconnection or to obtain or prolong an exemption from that obligation Annex III shall apply. The Commission shall make public the list of exemptions and keep it updated.

5. A proposal for enabling or enhancing bi-directional capacity or a request for granting or prolongation of an exemption shall include a cost-benefit analysis prepared on the basis of the methodology pursuant to Article 11 of Regulation (EU) No 347/2013 of the European Parliament and of the Council(1) and shall be based on the following elements:

(a) an assessment of market demand;

(b) projections for demand and supply;

(c) the possible economic impact on existing infrastructure;

(d) a feasibility study;

(e) the costs of bi-directional capacity including the necessary reinforcement of the transmission system; and

(f) the benefits to the security of gas supply taking into account the possible contribution of bi-directional capacity to meeting the infrastructure standard set out in this Article.

6. National regulatory authorities shall take into account the efficiently incurred costs of fulfilling the obligation set out in paragraph 1 of this Article and the costs of enabling bi-directional capacity so as to grant appropriate incentives when fixing or approving, in a transparent and detailed manner, the tariffs or methodologies in accordance with Article 13 of Regulation (EC) No 715/2009 and Article 41(8) of Directive 2009/73/EC.

7. In so far as an investment for enabling or enhancing bi-directional capacity is not required by the market but is considered to be necessary for the security of gas supply purposes and where that investment incurs costs in more than one Member State or in one Member State for the benefit of another Member State, the national regulatory authorities of all Member States concerned shall take a coordinated decision on cost allocation before any investment decision is taken. The cost allocation shall take into account the principles described and the elements contained in Article 12(4) of Regulation (EU) No 347/2013, in particular the proportion of the benefits of the infrastructure investments for the increase of the security of gas supply of the Member States concerned as well as investments already made in the infrastructure in question. The cost allocation shall not unduly distort competition and the effective functioning of the internal market and shall seek to avoid any undue distortive effect on the market.

8. The competent authority shall ensure that any new transmission infrastructure contributes to the security of gas supply through the development of a well-connected network, including, where appropriate, by means of a sufficient number of cross-border entry and exit points relative to market demand and the risks identified.

The competent authority shall assess in the risk assessment whether, with an integrated perspective on gas and electricity systems, internal bottlenecks exist and national entry capacity and infrastructure, in particular transmission networks, are capable of adapting the national and cross-border gas flows to the scenario of disruption of the single largest gas infrastructure at national level and the single largest gas infrastructure of common interest to the risk group identified in the risk assessment.

9. By way of exception from paragraph 1 of this Article, and subject to the conditions laid down in this paragraph, Luxembourg, Slovenia and Sweden shall not be bound by, but shall endeavour to meet, the obligation set out in that paragraph, while ensuring the gas supplies to protected customers in accordance with Article 6.

The exception shall apply to Luxembourg provided it has:

(a) at least two interconnectors with other Member States;

(b) at least two different sources of gas supply; and

(c) no gas storage facilities on its territory.

The exception shall apply to Slovenia provided it has:

(a) at least two interconnectors with other Member States;

(b) at least two different sources of gas supply; and

(c) no gas storage facilities or an LNG facility on its territory.

The exception shall apply to Sweden provided it has:

(a) no gas transit to other Member States on its territory;

(b) an annual gross inland gas consumption of less than 2 Mtoe; and

(c) less than 5 % of total primary energy consumption from gas.

Luxembourg, Slovenia and Sweden shall inform the Commission of any change affecting the conditions laid down in this paragraph. The exception laid down in this paragraph shall cease to apply where at least one of those conditions is no longer fulfilled.

As part of the national risk assessment carried out in accordance with Article 7(3) Luxembourg, Slovenia and Sweden shall describe the situation with respect to the respective conditions laid down in this paragraph and the prospects for compliance with the obligation in paragraph 1 of this Article, taking into account the economic impact of meeting the infrastructure standard, the gas market development and gas infrastructure projects in the risk group. On the basis of the information provided in the national risk assessment and if the respective conditions laid down in this paragraph are still met, the Commission may decide that the exception can continue to apply for four more years. In the event of a positive decision, the procedure set out in this subparagraph shall be repeated after four years.

Article 6 U.K. Gas supply standard

1. The competent authority shall require the natural gas undertakings that it identifies, to take measures to ensure the gas supply to the protected customers of the Member State in each of the following cases:

(a) extreme temperatures during a 7-day peak period occurring with a statistical probability of once in 20 years;

(b) any period of 30 days of exceptionally high gas demand, occurring with a statistical probability of once in 20 years;

(c) for a period of 30 days in the case of disruption of the single largest gas infrastructure under average winter conditions.

By 2 February 2018, each Member State shall notify to the Commission its definition of protected customers, the annual gas consumption volumes of the protected customers and the percentage that those consumption volumes represent of the total annual final gas consumption in that Member State. Where a Member State includes in its definition of protected customers the categories referred to in point (5)(a) or (b) of Article 2, it shall specify the gas consumption volumes corresponding to customers belonging to those categories and the percentage that each of those groups of customers represents in total annual final gas consumption.

The competent authority shall identify the natural gas undertakings referred to in the first subparagraph of this paragraph and shall specify them in the preventive action plan.

Any new non-market-based measures envisaged to ensure the gas supply standard shall comply with the procedure established in Article 9(4) to (9).

Member States may comply with the obligation laid down in the first subparagraph through the implementation of energy efficiency measures or by replacing the gas with a different source of energy, inter alia, renewable energy sources, to the extent that the same level of protection is achieved.

2. Any increased gas supply standard beyond the 30-day period referred to in points (b) and (c) of paragraph 1 or any additional obligation imposed for reasons of security of gas supply shall be based on the risk assessment, shall be reflected in the preventive action plan and shall:

(a) comply with Article 8(1);

(b) not impact negatively on the ability of any other Member State to supply gas to its protected customers in accordance with this Article in the event of a national, regional or Union emergency; and

(c) comply with Article 12(5) in the event of a regional or Union emergency.

The Commission may require a justification showing compliance of any measure referred to in the first subparagraph with the conditions laid down therein. Such a justification shall be made public by the competent authority of the Member State that introduces the measure.

Any new non-market-based measure pursuant to the first subparagraph of this paragraph, adopted on or after 1 November 2017, shall comply with the procedure established in Article 9(4) to (9).

3. After the expiry of the periods laid down by the competent authority in accordance with paragraphs 1 and 2, or under more severe conditions than those laid down in paragraph 1, the competent authority and natural gas undertakings shall endeavour to maintain, as far as possible, the gas supply, in particular to protected customers.

4. The obligations imposed on natural gas undertakings for the fulfilment of the gas supply standards laid down in this Article shall be non-discriminatory and shall not impose an undue burden on those undertakings.

5. Natural gas undertakings shall be allowed to meet their obligations based on this Article at a regional or Union level, where appropriate. The competent authorities shall not require the gas supply standards laid down in this Article to be met based on infrastructure located only within their territory.

6. The competent authorities shall ensure that conditions for supplies to protected customers are established without prejudice to the proper functioning of the internal energy market and at a price respecting the market value of the supplies.

Article 7 U.K. Risk assessment

1. By 1 November 2017, ENTSOG shall carry out a Union-wide simulation of gas supply and infrastructure disruption scenarios. The simulation shall include the identification and assessment of emergency gas supply corridors and shall also identify which Member States can address identified risks, including in relation to LNG. The gas supply and infrastructure disruption scenarios and the methodology for the simulation shall be defined by ENTSOG in cooperation with the GCG. ENTSOG shall ensure an appropriate level of transparency and access to the modelling assumptions used in its scenarios. The Union-wide simulation of gas supply and infrastructure disruption scenarios shall be repeated every four years unless circumstances warrant more frequent updates.

2. The competent authorities within each risk group listed in Annex I shall make a common assessment at risk group level (‘common risk assessment’) of all relevant risk factors such as natural disasters, technological, commercial, social, political and other risks, which could lead to the materialisation of the major transnational risk to the security of gas supply for which the risk group was created. The competent authorities shall take into account the results of the simulation referred to in paragraph 1 of this Article for the preparation of the risk assessments, preventive action plans and emergency plans.

The competent authorities within each risk group shall agree on a cooperation mechanism to conduct the common risk assessment and report it to the GCG eleven months before the deadline for the notification of the common risk assessment and its updates. At the request of a competent authority the Commission may have a facilitating role in the preparation of the common risk assessment, in particular for the establishment of the cooperation mechanism. If competent authorities within a risk group do not agree on a cooperation mechanism, the Commission shall propose a cooperation mechanism for that risk group, after consulting the competent authorities concerned. The competent authorities concerned shall agree on a cooperation mechanism for that risk group taking utmost account of the Commission's proposal.

10 months before the deadline for the notification of the common risk assessment or its updates, each competent authority shall share and update, within the agreed cooperation mechanism, all national data necessary for the preparation of the common risk assessment, in particular for running the various scenarios referred to in point (c) of paragraph 4.

3. The competent authority of each Member State shall make a national risk assessment (‘national risk assessment’) of all relevant risks affecting the security of gas supply. Such assessment shall be fully consistent with the assumptions and results of the common risk assessment(s).

4. The risk assessments referred to in paragraphs 2 and 3 of this Article shall be carried out, as relevant, by:

(a) using the standards specified in Articles 5 and 6. The risk assessment shall describe the calculation of the N – 1 formula at national level and where appropriate include a calculation of the N – 1 formula at regional level. The risk assessment shall also include the assumptions used, including where applicable those for the calculation of the N – 1 formula at regional level, and the data necessary for such calculation. The calculation of the N – 1 formula at national level shall be accompanied by a simulation of disruption of the single largest gas infrastructure using hydraulic modelling for the national territory as well as by a calculation of the N – 1 formula considering the level of gas in storages at 30 % and 100 % of the maximum working volume;

(b) taking into account all relevant national and transnational circumstances, in particular market size, network configuration, actual flows, including outflows from the Member States concerned, the possibility of physical gas flows in both directions including the potential need for consequent reinforcement of the transmission system, the presence of production and storage and the role of gas in the energy mixes, in particular with respect to district heating and electricity generation and for the operation of industries, and safety and gas quality considerations;

(c) running various scenarios of exceptionally high demand for gas and disruption of gas supply, taking into account the history, probability, season, frequency and duration of their occurrence and assessing their likely consequences, such as:

(i)

disruption of the infrastructure relevant to the security of gas supply, in particular transmission infrastructure, storages or LNG terminals, including the largest gas infrastructure identified for the calculation of N – 1 formula; and

(ii)

disruption of supplies from third-country suppliers, as well as, where appropriate, geopolitical risks;

(d) identifying the interaction and correlation of risks among the Member States in the risk group and with other Member States or other risk groups, as appropriate, including, as regards interconnections, cross-border supplies, cross-border access to storage facilities and bi-directional capacity;

(e) taking into account risks relating to the control of infrastructure relevant to the security of gas supply to the extent that they may involve, inter alia, risks of underinvestment, undermining diversification, misuse of existing infrastructure or an infringement of Union law;

(f) taking into account the maximal interconnection capacity of each border entry and exit point and various filling levels for storage.

5. The common and national risk assessments shall be prepared in accordance with the relevant template set out in Annex IV or V. If necessary, Member States may include additional information. The Commission is empowered to adopt delegated acts in accordance with Article 19 in order to amend the templates set out in Annexes IV and V, after consulting the GCG, in order to reflect the experience gained in the application of this Regulation, and to reduce the administrative burden on Member States.

6. Natural gas undertakings, industrial gas customers, the relevant organisations representing the interests of household and industrial gas customers as well as Member States and, where they are not the competent authorities, the national regulatory authorities, shall cooperate with the competent authorities and provide them upon request with all necessary information for the common and national risk assessments.

7. By 1 October 2018 Member States shall notify to the Commission the first common risk assessment once agreed by all Member States in the risk group and the national risk assessments. The risk assessments shall be updated every four years thereafter unless circumstances warrant more frequent updates. The risk assessments shall take account of progress made in investments needed to cope with the infrastructure standard defined in Article 5 and of country-specific difficulties encountered in the implementation of new alternative solutions. They shall also build on the experience acquired through the simulation of the emergency plans contained in Article 10(3).

Article 8 U.K. Establishment of preventive action plans and emergency plans

1. The measures to ensure the security of gas supply contained in a preventive action plan and an emergency plan shall be clearly defined, transparent, proportionate, non-discriminatory and verifiable, shall not unduly distort competition or the effective functioning of the internal market in gas and shall not endanger the security of gas supply of other Member States or of the Union.

2. The competent authority of each Member State shall, after consulting the natural gas undertakings, the relevant organisations representing the interests of household and industrial gas customers, including electricity producers, electricity transmission system operators, and, where it is not the competent authority, the national regulatory authority, establish:

(a) a preventive action plan containing the measures needed to remove or mitigate the risks identified, including the effects of energy efficiency and demand-side measures in the common and nationals risk assessments and in accordance with Article 9;

(b) an emergency plan containing the measures to be taken to remove or mitigate the impact of a disruption of gas supply in accordance with Article 10.

3. The preventive action plan and the emergency plan shall contain a regional chapter, or several regional chapters, where a Member State is a member of different risk groups as defined in Annex I.

The regional chapters shall be developed jointly by all Member States in the risk group before incorporation in the respective national plans. The Commission shall act as a facilitator so as to enable that the regional chapters collectively enhance the security of gas supply in the Union, and, do not give rise to any contradiction, and to overcome any obstacles to cooperation.

The regional chapters shall contain appropriate and effective cross-border measures, including in relation to LNG, subject to agreement between the Member States implementing the measures from the same or different risk groups affected by the measure on the basis of the simulation referred to in Article 7(1) and the common risk assessment.

4. The competent authorities shall report regularly to the GCG on the progress achieved on the preparation and adoption of the preventive action plans and the emergency plans, in particular the regional chapters. In particular, competent authorities shall agree on a cooperation mechanism for the preparation of the preventive action plan and the emergency plan, including the exchange of draft plans. They shall report to the GCG on such agreed cooperation mechanism 16 months before the deadline for agreement of those plans and the updates of those plans.

The Commission may have a facilitating role in the preparation of the preventive action plan and the emergency plan, in particular for the establishment of the cooperation mechanism. If competent authorities within a risk group do not agree on a cooperation mechanism, the Commission shall propose a cooperation mechanism for that risk group. The competent authorities concerned shall agree on the cooperation mechanism for that risk group taking account of the Commission's proposal. The competent authorities shall ensure the regular monitoring of the implementation of the preventive action plan and the emergency plan.

5. The preventive action plan and the emergency plan shall be developed in accordance with the templates contained in Annexes VI and VII. The Commission is empowered to adopt delegated acts in accordance with Article 19 in order to amend the templates set out in Annexes VI and VII, after consulting the GCG, in order to reflect the experience gained in the application of this Regulation, and to reduce the administrative burden on Member States.

6. The competent authorities of neighbouring Member States shall in due time consult each other with a view to ensuring consistency between their preventive action plans and their emergency plans.

The competent authorities shall, within each risk group, exchange draft preventive action plans and emergency plans with proposals for cooperation, at the latest five months before the deadline for submission of the plans.

The final versions of the regional chapters referred to in paragraph 3 shall be agreed by all Member States in the risk group. The preventive action plans and emergency plans shall also contain the national measures necessary to implement and enforce the cross-border measures in the regional chapters.

7. The preventive action plans and the emergency plans shall be made public and notified to the Commission by 1 March 2019. The Commission shall inform the GCG about the notification of the plans and publish them on the Commission's website.

Within four months of the notification by the competent authorities, the Commission shall assess the plans taking into account the views expressed in the GCG.

8. The Commission shall issue an opinion to the competent authority with the recommendation to review a preventive action plan or an emergency plan if one or more of the following applies:

(a) it is not effective to mitigate the risks as identified in the risk assessment;

(b) it is inconsistent with the risk scenarios assessed or with the plans of another Member State or a risk group;

(c) it does not comply with the requirement laid down in paragraph 1 not unduly to distort competition or the effective functioning of the internal market;

(d) it does not comply with the provisions of this Regulation or other provisions of Union law.

9. Within three months of notification of the Commission's opinion referred to in paragraph 8, the competent authority concerned shall notify the amended preventive action plan or the emergency plan to the Commission, or shall inform the Commission of the reasons for which it disagree with the recommendations.

In the event of disagreement related to elements referred to in paragraph 8, the Commission may, within four months of the reply of the competent authority, withdraw its request or convene the competent authority and, where the Commission considers it to be necessary, the GCG, in order to consider the issue. The Commission shall set out its detailed reasons for requesting any amendments to the preventive action plan or the emergency plan. The competent authority concerned shall take full account of the detailed reasons of the Commission.

Where applicable, the competent authority concerned shall without delay amend and make the amended preventive action plan or emergency plan public.

Where the final position of the competent authority concerned diverges from the Commission's detailed reasons, that competent authority shall provide and make public, together with its position and the Commission's detailed reasons, the justification underlying its position within two months of receipt of the detailed reasons of the Commission.

10. For non-market-based measures adopted on or after 1 November 2017, the procedure set out in Article 9(4), (6), (8) and (9) shall apply.

11. The confidentiality of commercially sensitive information shall be preserved.

12. Preventive action plans and emergency plans developed under Regulation (EU) No 994/2010, updated in accordance with that Regulation, shall remain in force until the preventive action plans and the emergency plans referred to in paragraph 1 of this Article are established for the first time.

Article 9 U.K. Content of preventive action plans

1. The preventive action plan shall contain:

(a) the results of the risk assessment and a summary of the scenarios considered, as referred to in point (c) of Article 7(4);

(b) the definition of protected customers and the information described in the second subparagraph of Article 6(1);

(c) the measures, volumes and capacities needed to fulfil the infrastructure and gas supply standards laid down in Articles 5 and 6, including, where applicable, the extent to which demand-side measures can sufficiently compensate, in a timely manner, for a disruption of gas supply as referred to in Article 5(2), the identification of the single largest gas infrastructure of common interest in the case of the application of Article 5(3), the necessary gas volumes per category of protected customers and per scenario as referred to in Article 6(1), and any increased gas supply standard including any justification showing compliance with the conditions laid down in Article 6(2) and a description of a mechanism to reduce temporarily any increased gas supply standard or additional obligation in accordance with Article 11(3);

(d) obligations imposed on natural gas undertakings, electricity undertakings where appropriate, and other relevant bodies likely to have an impact on the security of gas supply, such as obligations for the safe operation of the gas system;

(e) other preventive measures designed to address the risks identified in the risk assessment, such as those relating to the need to enhance interconnections between neighbouring Member States, to further improve energy efficiency, to reduce gas demand and the possibility to diversify gas routes and sources of gas supply and the regional utilisation of existing storage and LNG capacities, if appropriate, in order to maintain gas supply to all customers as far as possible;

(f) information on the economic impact, effectiveness and efficiency of the measures contained in the plan, including the obligations referred to in point (k);

(g) a description of the effects of the measures contained in the plan on the functioning of the internal energy market as well as national markets, including the obligations referred to in point (k);

(h) a description of the impact of the measures on the environment and on customers;

(i) the mechanisms to be used for cooperation with other Member States, including the mechanisms for preparing and implementing preventive action plans and emergency plans;

(j) information on existing and future interconnections and infrastructure, including those providing access to the internal market, cross-border flows, cross-border access to storage and LNG facilities and the bi-directional capacity, in particular in the event of an emergency;

(k) information on all public service obligations that relate to the security of gas supply.

Critical information relating to points (a), (c) and (d) of the first subparagraph which, if revealed, could endanger the security of gas supply, may be excluded.

2. The preventive action plan, in particular the actions to meet the infrastructure standard as laid down in Article 5, shall take into account the Union-wide TYNDP elaborated by ENTSOG pursuant to Article 8(10) of Regulation (EC) No 715/2009.

3. The preventive action plan shall be based primarily on market-based measures and shall not put an undue burden on natural gas undertakings, or negatively impact on the functioning of the internal market in gas.

4. Member States, and in particular their competent authorities, shall ensure that all preventive non-market-based measures, such as those referred to in Annex VIII, adopted on or after 1 November 2017, irrespective of whether they are part of the preventive action plan or adopted subsequently, comply with the criteria laid down in the first subparagraph of Article 6(2).

5. The competent authority shall make public any measure referred to in paragraph 4 which has not yet been included in the preventive action plan, and shall notify to the Commission the description of any such measure and of its impact on the national gas market and, to the extent possible, on the gas markets of other Member States.

6. If the Commission doubts whether a measure referred to in paragraph 4 of this Article complies with the criteria laid down in the first subparagraph of Article 6(2) it shall request from the Member State concerned the notification of an impact assessment.

7. An impact assessment pursuant to paragraph 6 shall cover at least the following:

(a) the potential impact on the development of the national gas market and competition at national level;

(b) the potential impact on the internal gas market;

(c) the potential impact on the security of gas supply of neighbouring Member States, in particular for those measures that could reduce the liquidity in regional markets or restrict flows to neighbouring Member States;

(d) the costs and benefits, assessed against alternative market-based-measures;

(e) an assessment of necessity and proportionality in comparison with possible market-based measures;

(f) an appreciation whether the measure ensures equal possibilities for all market participants;

(g) a phase-out strategy, the expected duration of the envisaged measure and an appropriate review calendar.

The analysis referred to in points (a) and (b) shall be carried out by the national regulatory authority. The impact assessment shall be made public by the competent authority and shall be notified to the Commission.

8. Where the Commission considers, based on the impact assessment, that the measure is likely to endanger the security of gas supply of other Member States or of the Union it shall take a decision within four months of notification of the impact assessment requiring, to the extent necessary, the amendment or withdrawal of the measure.

The adopted measure shall enter into force only when it is approved by the Commission or has been amended in accordance with the Commission decision.

The four-month period shall begin on the day following receipt of a complete notification. The four-month period may be extended with the consent of both the Commission and the competent authority.

9. Where the Commission considers, based on the impact assessment, that the measure does not comply with the criteria laid down in the first paragraph of Article 6(2) it may issue an opinion within four months of notification of the impact assessment. The procedure set out in Article 8(8) and (9) shall apply.

The four-month period shall begin on the day following receipt of a complete notification. The four-month period may be extended with the consent of both the Commission and the competent authority.

10. Article 8(9) shall apply to any measure subject to paragraphs 6 to 9 of this Article.

11. The preventive action plan shall be updated every four years after 1 March 2019 or more frequently if the circumstances so warrant or at the Commission's request. The updated plan shall reflect the updated risk assessment and the results of the tests carried out in accordance with Article 10(3). Article 8 shall apply to the updated plan.

Article 10 U.K. Content of emergency plans

1. The emergency plan shall:

(a) build upon the crisis levels referred to in Article 11(1);

(b) define the role and responsibilities of natural gas undertakings, transmission system operators for electricity if relevant and of industrial gas customers including relevant electricity producers, taking account of the different extent to which they are affected in the event of a disruption of gas supply, and their interaction with the competent authorities and where appropriate with the national regulatory authorities at each of the crisis levels referred to in Article 11(1);

(c) define the role and responsibilities of the competent authorities and of the other bodies to which tasks have been delegated as referred to in Article 3(2) at each of the crisis levels referred to in Article 11(1);

(d) ensure that natural gas undertakings and industrial gas customers including relevant electricity producers are given sufficient opportunity to respond to the crisis levels referred to in Article 11(1);

(e) identify, if appropriate, the measures and actions to be taken to mitigate the potential impact of a disruption of gas supply on district heating and the supply of electricity generated from gas, including through an integrated view of energy systems operations across electricity and gas if relevant;

(f) establish detailed procedures and measures to be followed for the crisis levels referred to in Article 11(1), including the corresponding schemes on information flows;

(g) designate a crisis manager and define its role;

(h) identify the contribution of market-based measures for coping with the situation at alert level and mitigating the situation at emergency level;

(i) identify the contribution of non-market-based measures planned or to be implemented for the emergency level, and assess the degree to which the use of such non-market-based measures is necessary to cope with a crisis. The effects of the non-market-based measures shall be assessed and procedures for their implementation defined. Non-market-based measures are to be used only when market-based mechanisms alone can no longer ensure supplies, in particular to protected customers, or for the application of Article 13;

(j) describe the mechanisms used to cooperate with other Member States for the crisis levels referred to in Article 11(1) and information exchange arrangements between the competent authorities;

(k) detail the reporting obligations imposed on natural gas undertakings and, where appropriate, electricity undertakings at alert and emergency levels;

(l) describe the technical or legal arrangements in place to prevent undue gas consumption of customers who are connected to a gas distribution or transmission network but not protected customers;

(m) describe the technical, legal and financial arrangements in place to apply the solidarity obligations laid down in Article 13;

(n) estimate the gas volumes that could be consumed by solidarity protected customers covering at least the cases described in Article 6(1);

(o) establish a list of predefined actions to make gas available in the event of an emergency, including commercial agreements between the parties involved in such actions and the compensation mechanisms for natural gas undertakings where appropriate, taking due account of the confidentiality of sensitive data. Such actions may involve cross-border agreements between Member States and/or natural gas undertakings.

In order to prevent undue gas consumption during an emergency, as referred to in point (l) of the first subparagraph, or during the application of the measures referred to in Article 11(3) and Article 13, the competent authority of the Member State concerned shall inform customers who are not protected customers that they are required to cease or reduce their gas consumption without creating technically unsafe situations.

2. The emergency plan shall be updated every four years after 1 March 2019 or more frequently if circumstances so warrant or at the Commission's request. The updated plan shall reflect the updated risk assessment and the results of the tests carried out in accordance with paragraph 3 of this Article. Article 8(4) to (11) shall apply to the updated plan.

3. The measures, actions and procedures contained in the emergency plan shall be tested at least once between its four-year updates referred to in paragraph 2. In order to test the emergency plan, the competent authority shall simulate high and medium impact scenarios and responses in real time in accordance with that emergency plan. The results of the tests shall be presented at the GCG by the competent authority.

4. The emergency plan shall ensure that cross-border access to infrastructure in accordance with Regulation (EC) No 715/2009 is maintained as far as technically and safely possible in the event of an emergency and shall not introduce any measure unduly restricting the flow of gas across borders.

Article 11 U.K. Declaration of a crisis

1. There shall be the following three crisis levels:

(a) early warning level (‘early warning’): where there is concrete, serious and reliable information that an event which is likely to result in significant deterioration of the gas supply situation may occur and is likely to lead to the alert or the emergency level being triggered; the early warning level may be activated by an early warning mechanism;

(b) alert level (‘alert’): where a disruption of gas supply or exceptionally high gas demand which results in significant deterioration of the gas supply situation occurs but the market is still able to manage that disruption or demand without the need to resort to non-market-based measures;

(c) emergency level (‘emergency’): where there is exceptionally high gas demand, significant disruption of gas supply or other significant deterioration of the gas supply situation and all relevant market-based measures have been implemented but the gas supply is insufficient to meet the remaining gas demand so that non-market-based measures have to be additionally introduced with a view, in particular, to safeguarding gas supplies to protected customers in accordance with Article 6.

2. When the competent authority declares one of the crisis levels referred to in paragraph 1, it shall immediately inform the Commission as well as the competent authorities of the Member States with which the Member State of that competent authority is directly connected and provide them with all the necessary information, in particular with information on the action it intends to take. In the event of an emergency which may result in a call for assistance from the Union and its Member States, the competent authority of the Member State concerned shall without delay notify the Commission's Emergency Response Coordination Centre (ERCC).

3. Where a Member State has declared an emergency and has indicated that cross-border action is required, any increased gas supply standard or additional obligation under Article 6(2) imposed on natural gas undertakings in other Member States in the same risk group shall be temporarily reduced to the level established in Article 6(1).

The obligations laid down in the first subparagraph of this paragraph shall cease to apply immediately after the competent authority declares an end to an emergency, or the Commission concludes, in accordance with the first subparagraph of paragraph 8, that the declaration of an emergency is not or is no longer justified.

4. When the competent authority declares an emergency it shall follow the pre-defined action as set out in its emergency plan and shall immediately inform the Commission and the competent authorities in the risk group as well as the competent authorities of the Member States with which the Member State of that competent authority is directly connected in particular of the action it intends to take. In duly justified exceptional circumstances, the competent authority may take action deviating from the emergency plan. The competent authority shall immediately inform the Commission and the competent authorities in its risk group as set out in Annex I, as well as the competent authorities of the Member States with which the Member State of that competent authority is directly connected, of any such action and shall provide a justification for the deviation.

5. The transmission system operator shall ensure that when an emergency is declared in a neighbouring Member State, capacity at interconnection points to that Member State, irrespective of whether firm or interruptible, and whether it has been booked before or during the emergency, has priority over competing capacity at exit points into storage facilities. The system user of the prioritised capacity shall promptly pay fair compensation to the system user of the firm capacity for the financial loss incurred as a result of prioritisation including a proportionate reimbursement for the cost of the firm capacity being interrupted. The process of determining and paying the compensation shall not affect the implementation of the priority rule.

6. The Member States and, in particular, the competent authorities shall ensure that:

(a) no measures are introduced which unduly restrict the flow of gas within the internal market at any time;

(b) no measures are introduced that are likely seriously to endanger the gas supply situation in another Member State; and

(c) cross-border access to infrastructure in accordance with Regulation (EC) No 715/2009 is maintained as far as technically and safely possible, in accordance with the emergency plan.

7. During an emergency and on reasonable grounds, upon a request of the relevant electricity or gas transmission system operator a Member State may decide to prioritise the gas supply to certain critical gas-fired power plants over the gas supply to certain categories of protected customers, if the lack of gas supply to such critical gas-fired power plants either:

(a) could result in severe damage in the functioning of the electricity system; or

(b) would hamper the production and/or transportation of gas.

Member States shall base any such measure on the risk assessment.

Critical gas-fired power plants as referred to in the first subparagraph shall be clearly identified together with the possible gas volumes that would be subject to such a measure and included in the regional chapters of the preventive action plans and emergency plans. Their identification shall be carried out in close cooperation with transmission system operators of the electricity system and the gas system of the Member State concerned.

8. The Commission shall verify, as soon as possible, but in any case within five days of receiving the information referred to in paragraph 2 from the competent authority, whether the declaration of an emergency is justified in accordance with point (c) of paragraph 1 and whether the measures taken follow as closely as possible the actions listed in the emergency plan and are not imposing an undue burden on natural gas undertakings and are in accordance with paragraph 6. The Commission may, at the request of another competent authority, natural gas undertakings or on its own initiative, request the competent authority to modify the measures where they are contrary to the conditions referred to in the first sentence of this paragraph. The Commission may also request the competent authority to declare an end to the emergency where it concludes that the declaration of an emergency is not or is no longer justified in accordance with point (c) of paragraph 1.

Within three days of notification of the Commission request, the competent authority shall modify the measures and shall notify the Commission thereof, or shall inform the Commission of the reasons for which it disagrees with the request. In the latter case, the Commission may, within three days of being informed, amend or withdraw its request or, in order to consider the issue, convene the competent authority or, where appropriate, the competent authorities concerned, and, where the Commission considers it to be necessary, the GCG. The Commission shall set out its detailed reasons for requesting any modification to the action. The competent authority shall take full account of the position of the Commission. Where the final decision of the competent authority diverges from the Commission position, the competent authority shall provide the reasons underlying such decision.

9. When the competent authority declares an end to one of the crisis levels referred to in paragraph 1, it shall inform the Commission as well as the competent authorities of the Member States with which the Member State of that competent authority is directly connected.

Article 12 U.K. Regional and Union emergency responses

1. The Commission may declare a regional or Union emergency at the request of a competent authority that has declared an emergency and following the verification in accordance with Article 11(8).

The Commission shall declare, as appropriate, a regional or Union emergency at the request of at least two competent authorities that have declared an emergency and following the verification in accordance with Article 11(8), and where the reasons for such emergencies are linked.

In all cases, when it declares a regional or Union emergency, the Commission, using the means of communication most appropriate to the situation, shall gather the views of, and take due account of all the relevant information provided by other competent authorities. When the Commission decides, following an assessment, that the underlying basis for the regional or Union emergency no longer justifies the declaration of an emergency, it shall declare an end to the regional or Union emergency and shall give its reasons and inform the Council of its decision.

2. The Commission shall convene the GCG as soon as it declares a regional or Union emergency.

3. In a regional or Union emergency, the Commission shall coordinate the action of the competent authorities, taking full account of relevant information from, and the results of, the consultation of the GCG. In particular, the Commission shall:

(a) ensure the exchange of information;

(b) ensure the consistency and effectiveness of action at Member State and regional levels in relation to the Union level;

(c) coordinate the actions with regard to third countries.

4. The Commission may convene a crisis management group composed of the crisis managers referred to in point (g) of Article 10(1), of the Member States concerned by the emergency. The Commission, in agreement with the crisis managers, may invite other relevant stakeholders to participate. The Commission shall ensure that the GCG is informed regularly about the work undertaken by the crisis management group.

5. The Member States and in particular the competent authorities shall ensure that:

(a) no measures are introduced which unduly restrict the flow of gas within the internal market at any time, in particular the flow of gas to the affected markets;

(b) no measures are introduced that are likely seriously to endanger the gas supply situation in another Member State; and

(c) cross-border access to infrastructure in accordance with Regulation (EC) No 715/2009 is maintained as far as technically and safely possible, in accordance with the emergency plan.

6. Where, at the request of a competent authority or a natural gas undertaking or on its own initiative, the Commission considers that, in a regional or Union emergency, action taken by a Member State or a competent authority or the behaviour of a natural gas undertaking is contrary to paragraph 5, the Commission shall request that Member State or competent authority to modify its action or to take action in order to ensure compliance with paragraph 5, informing it of the reasons therefor. Due account shall be taken of the need to operate the gas system safely at all times.

Within three days of notification of the Commission request, the Member State or the competent authority shall modify its action and notify the Commission thereof, or shall inform the Commission of the reasons for which it disagrees with the request. In the latter case, the Commission may, within three days of being informed, amend or withdraw its request or convene the Member State or the competent authority and, where the Commission considers it to be necessary, the GCG in order to consider the issue. The Commission shall set out its detailed reasons for requesting any modification to the action. The Member State or the competent authority shall take full account of the position of the Commission. Where the final decision of the competent authority or the Member State diverges from the Commission position, the competent authority or the Member State shall provide the reasons underlying such decision.

7. The Commission, after consulting the GCG, shall establish a permanent reserve list for a monitoring task force consisting of industry experts and representatives of the Commission. The monitoring task force may be deployed outside the Union when necessary and shall monitor and report on the gas flows into the Union, in cooperation with the supplying and transiting third countries.

8. The competent authority shall provide to the Commission's ERCC the information on any need for assistance. ERCC shall assess the overall situation and advise on the assistance that should be provided to the most affected Member States, and where appropriate to third countries.

Article 13 U.K. Solidarity

1. If a Member State has requested the application of the solidarity measure pursuant to this Article, a Member State which is directly connected to the requesting Member State or, where the Member State so provides, its competent authority or transmission system operator or distribution system operator shall as far as possible without creating unsafe situations, take the necessary measures to ensure that the gas supply to customers other than solidarity protected customers in its territory is reduced or does not continue to the extent necessary and for as long as the gas supply to solidarity protected customers in the requesting Member State is not satisfied. The requesting Member State shall ensure that the relevant volume of gas is effectively delivered to solidarity protected customers in its territory.

In exceptional circumstances and upon a duly reasoned request by the relevant electricity or gas transmission system operator to its competent authority, the gas supply may also continue to certain critical gas-fired power plants as defined pursuant to Article 11(7) in the Member State providing solidarity if the lack of gas supply to such plants would result in severe damage in the functioning of the electricity system or would hamper the production and/or transportation of gas.

2. A Member State shall also provide the solidarity measure to another Member State to which it is connected via a third country unless flows are restricted through the third country. Such an extension of the measure shall be subject to the agreement of the relevant Member States, who shall involve, as appropriate, the third country through which they are connected.

3. A solidarity measure shall be taken as a last resort and shall apply only if the requesting Member State has:

(a) not been able to cover the deficit in gas supply to its solidarity protected customers despite the application of the measure referred to in Article 11(3);

(b) exhausted all market-based measures and all measures provided in its emergency plan;

(c) notified an explicit request to the Commission and to the competent authorities of all Member States with which it is connected either directly or pursuant to paragraph 2 via a third country, accompanied by a description of the implemented measures referred to in point (b) of this paragraph;

(d) undertaken to pay fair and prompt compensation to the Member State providing solidarity in accordance with paragraph 8.

4. If there is more than one Member State that could provide solidarity to a requesting Member State, the requesting Member State shall, after consulting all Member States required to provide solidarity, seek the most advantageous offer on the basis of cost, speed of delivery, reliability and diversification of supplies of gas. The Member States concerned shall make such offers on the basis of voluntary demand-side measures as much as and for as long as possible, before resorting to non-market-based measures.

5. Where market-based measures prove insufficient for the Member State providing solidarity to address the deficit in gas supply to solidarity protected customers in the requesting Member State, the Member State providing solidarity may introduce non-market-based measures in order to comply with the obligations laid down in paragraphs 1 and 2.

6. The competent authority of the requesting Member State shall immediately inform the Commission and the competent authorities of the Member States providing solidarity when gas supply to solidarity protected customers in its territory is satisfied or where the obligations under paragraphs 1 and 2 are, based on its needs, reduced, or where they are suspended at the request of the Member State receiving solidarity.

7. The obligations laid down in paragraphs 1 and 2 shall apply subject to the technically safe and reliable operation of the gas system of a Member State providing solidarity and the limit of the maximum interconnection export capability of the relevant Member State infrastructure towards the requesting Member State. Technical, legal and financial arrangements may reflect such circumstances in particular those under which the market will deliver up to maximum interconnection capacity.

8. Solidarity under this Regulation shall be provided on the basis of compensation. The Member State requesting solidarity shall promptly pay, or ensure prompt payment of, fair compensation to the Member State providing solidarity. Such fair compensation shall cover at least:

(a) the gas delivered into the territory of the requesting Member State;

(b) all other relevant and reasonable costs incurred when providing solidarity, including, where appropriate, costs of such measures that may have been established in advance;

(c) reimbursement for any compensation resulting from judicial proceedings, arbitration proceedings or similar proceedings and settlements and related costs of such proceedings involving the Member State providing solidarity vis-a-vis entities involved in the provision of such solidarity.

Fair compensation pursuant to the first subparagraph shall include, inter alia, all reasonable costs that the Member State providing solidarity incurs from an obligation to pay compensation by virtue of fundamental rights guaranteed by Union law and by virtue of the applicable international obligations when implementing this Article and further reasonable costs incurred from payment of compensation pursuant to national compensation rules.

By 1 December 2018, the Member States shall adopt the necessary measures, in particular the technical, legal and financial arrangements pursuant to paragraph 10, to implement the first and second subparagraphs of this paragraph. Such measures may provide for the practical modalities of prompt payment.

9. Member States shall ensure that the provisions of this Article are implemented in conformity with the Treaties, the Charter of Fundamental Rights of the European Union, as well as the applicable international obligations. They shall take the necessary measures to that effect.

10. By 1 December 2018, the Member States shall adopt the necessary measures, including those agreed in technical, legal and financial arrangements, to ensure that gas is supplied to solidarity protected customers in the requesting Member State in accordance with paragraphs 1 and 2. The technical, legal and financial arrangements shall be agreed among the Member States which are directly connected or, in accordance with paragraph 2, via a third country, and shall be described in their respective emergency plans. Such arrangements may cover, among others, the following elements:

(a) the operational safety of networks;

(b) gas prices to be applied and/or the methodology for their setting, taking into account the impact on the functioning of the market;

(c) the use of interconnections, including bi-directional capacity and underground gas storage;

(d) gas volumes or the methodology for their setting;

(e) categories of costs that will have to be covered by a fair and prompt compensation, that may include damages for curtailed industry;

(f) an indication of the method how the fair compensation could be calculated.

The financial arrangement agreed between Member States before solidarity is requested shall contain provisions that allow for the calculation of the fair compensation of at least all relevant and reasonable costs incurred when providing solidarity and an undertaking that such compensation will be paid.

Any compensation mechanism shall provide incentives to participate in market-based solutions such as auctions and demand response mechanisms. It shall not create perverse incentives, including in financial terms, for market players to postpone their action until non-market-based measures are applied. All compensation mechanisms or at least their summary shall be included in the emergency plans.

11. For as long as a Member State can cover the gas consumption for its solidarity protected customers from its own production, it shall be exempt from the obligation to conclude technical, legal and financial arrangements with Member States with which it is directly connected or, in accordance with paragraph 2, via a third country, for the purpose of receiving solidarity. Such an exemption shall not affect the obligation of the relevant Member State to provide solidarity to other Member States pursuant to this Article.

12. By 1 December 2017 and after consulting the GCG, the Commission shall provide for legally non-binding guidance for the key elements of the technical, legal and financial arrangements especially on how to apply the elements described in paragraphs 8 and 10 in practice.

13. Where Member States do not agree on the necessary technical, legal and financial arrangements by 1 October 2018, the Commission may after consulting the competent authorities concerned, propose a framework for such measures setting out the necessary principles to make them operational which shall build on the Commission's guidance set out in paragraph 12. Member States shall finalise their arrangements by 1 December 2018 taking utmost account of the Commission's proposal.

14. The applicability of this Article shall not be affected if Member States fail to agree or finalise their technical, legal and financial arrangements. In such a situation the Member States concerned shall agree on the necessary ad hoc measures and the Member State requesting solidarity shall provide an undertaking in accordance with point (d) of paragraph 3.

15. The obligations laid down in paragraphs 1 and 2 of this Article shall cease to apply immediately after the declaration of the end of an emergency or the Commission concludes, in accordance with the first subparagraph of Article 11(8), that the declaration of an emergency is not or is no longer justified.

16. Where the Union incurs costs by virtue of any liability, other than for unlawful acts or conduct pursuant to the second paragraph of Article 340 TFEU, in respect of measures that Member States are required to take pursuant to this Article, those costs shall be reimbursed to it by the Member State receiving solidarity.

Article 14 U.K. Information exchange

1. Where a Member State has declared one of the crisis levels referred to in Article 11(1), the natural gas undertakings concerned shall make available, on a daily basis, in particular the following information to the competent authority of the Member State concerned:

(a) the daily gas demand and gas supply forecasts for the following three days, in million cubic metres per day (mcm/d);

(b) the daily flow of gas at all cross-border entry and exit points as well as at all points connecting a production facility, a storage facility or an LNG terminal to the network, in million cubic metres per day (mcm/d);

(c) the period, expressed in days, for which it is expected that supply of gas to protected customers can be ensured.

2. In the event of a regional or Union emergency, the Commission may request that the competent authority referred to in paragraph 1 provide it without delay with at least:

(a) the information set out in paragraph 1;

(b) information on the measures planned to be undertaken and those already implemented by the competent authority to mitigate the emergency, and information on their effectiveness;

(c) the requests made for additional measures to be taken by other competent authorities;

(d) the measures implemented at the request of other competent authorities.

3. After an emergency, the competent authority referred to in paragraph 1 shall, as soon as possible and at the latest six weeks after the lifting of the emergency, provide the Commission with a detailed assessment of the emergency and the effectiveness of the measures implemented, including an assessment of the economic impact of the emergency, the impact on the electricity sector and the assistance provided to or received from, the Union and its Member States. Such assessment shall be made available to the GCG and shall be reflected in the updates of the preventive action plans and the emergency plans.

The Commission shall analyse the assessments of the competent authorities and shall inform the Member States, the European Parliament and the GCG of the results of its analysis in an aggregated form.

4. In duly justified circumstances irrespective of a declaration of an emergency, the competent authority of the most affected Member State may require natural gas undertakings to provide the information referred to in paragraph 1 or additional information necessary to assess the overall situation of the gas supply in the Member State or other Member States, including contractual information, other than price information. The Commission may request from the competent authorities the information provided by natural gas undertakings under this paragraph, provided that the same information has not been transmitted already to the Commission.

5. Where the Commission considers the gas supply in the Union or part of the Union to be at risk or is likely to be at risk that may lead to the declaration of one of the crisis levels referred to in Article 11(1), it may require the competent authorities concerned to collect and submit to the Commission information necessary to assess of the gas supply situation. The Commission shall share its assessment with the GCG.

6. In order for the competent authorities and the Commission to assess the security of gas supply situation at national, regional and Union level, each natural gas undertaking shall notify:

(a) to the competent authority concerned the following details of gas supply contracts with a cross-border dimension and a duration of more than one year which it has concluded to procure gas:

(i)

contract duration;

(ii)

yearly contracted volumes;

(iii)

contracted maximum daily volumes in the event of an alert or emergency;

(iv)

contracted delivery points;

(v)

minimum daily and monthly gas volumes;

(vi)

conditions for the suspension of gas deliveries.

(vii)

an indication whether the contract individually or cumulatively with its contracts with the same supplier or its affiliates is equivalent to or exceeds the threshold of 28 % as referred to in point (b) of paragraph 6 in the most affected Member State.

(b) to the competent authority of the most affected Member State immediately after their conclusion or modification its gas supply contracts with a duration of more than one year, concluded or modified on or after 1 November 2017 that individually or cumulatively with its contracts with the same supplier or its affiliates is equivalent to 28 % or more of yearly gas consumption in that Member State to be calculated on the basis of the most recent available data. In addition, by 2 November 2018 natural gas undertakings shall notify the competent authority of all existing contracts fulfilling the same conditions. The notification obligation shall not cover price information and shall not apply to the modifications related only to the gas price. The notification obligation shall also apply to all commercial agreements that are relevant for the execution of the gas supply contract excluding price information.

The competent authority shall notify the data listed in point (a) of the first subparagraph to the Commission in an anonymised form. In the event of new contracts being concluded or changes being made to existing contracts, the whole set of data shall be notified by the end of September of the relevant year. Where the competent authority has doubts whether a given contract obtained under point (b) of the first subparagraph puts the security of gas supply of a Member State or a region at risk, it shall notify the contract to the Commission.

7. In circumstances duly justified by the need to guarantee transparency of key gas supply contracts relevant to the security of gas supply, and where the competent authority of the most affected Member State or the Commission considers that a gas supply contract may jeopardise the security of gas supply of a Member State, of a region or of the Union, the competent authority of the Member State or the Commission may request the natural gas undertaking to provide the contract, excluding price information, for the assessment of its impact on the security of gas supply. The request shall be reasoned and may cover also details of any other commercial agreements that are relevant for the execution of the gas supply contract excluding price information. The justification shall include the proportionality of the administrative burden involved.

8. The competent authorities that receive information on the basis of point (b) of paragraph 6 or paragraph 7 of this Article shall assess the received information for security of gas supply purposes within three months and submit the results of their assessment to the Commission.

9. The competent authority shall take into account the information received under this Article in the preparation of the risk assessment, preventive action plan and emergency plan or their respective updates. The Commission may adopt an opinion proposing to the competent authority to amend the risk assessments or plans on the basis of the information received under this Article. The competent authority concerned shall review the risk assessment and the plans concerned by the request in accordance with the procedure set out in Article 8(9).

10. By 2 May 2019, the Member States shall lay down the rules on penalties applicable to infringements by natural gas undertakings of paragraph 6 or 7 of this Article and shall take all measures necessary to ensure that they are implemented. The penalties provided for shall be effective, proportionate and dissuasive.

11. For the purpose of this Article, ‘the most affected Member State’ shall mean a Member State where a contract party of a given contract has the most of its sales of gas or customers located.

12. All contracts or contractual information received on the basis of paragraphs 6 and 7 as well as the respective assessments by the competent authorities or the Commission shall remain confidential. The competent authorities and the Commission shall ensure full confidentiality.

Article 15 U.K. Professional secrecy

1. Any commercially sensitive information received, exchanged or transmitted pursuant to Article 14(4) to (8), and Article 18 excluding the results of the assessments referred to in Article 14(3) and (5) shall be confidential and subject to the conditions of professional secrecy laid down in this Article.

2. The obligation of professional secrecy shall apply to the following persons who receive confidential information in accordance with this Regulation:

(a) persons who work or who have worked for the Commission;

(b) auditors and experts instructed by the Commission;

(c) persons who work or who have worked for the competent authorities and the national regulatory authorities or for other relevant authorities;

(d) auditors and experts instructed by competent authorities and national regulatory authorities or by other relevant authorities.

3. Without prejudice to cases covered by criminal law, the other provisions of this Regulation or other relevant Union law, confidential information received by the persons referred to in paragraph 2 in the course of their duties may not be divulged to any other person or authority, except in summary or aggregate form such that an individual market participant or market place cannot be identified.

4. Without prejudice to cases covered by criminal law, the Commission, the competent authorities and the national regulatory authorities, bodies or persons which receive confidential information pursuant to this Regulation may use confidential information only in the performance of their duties and for the exercise of their functions. Other authorities, bodies or persons may use that information for the purpose for which it was provided to them or in the context of administrative or judicial proceedings specifically related to the exercise of their functions.

Article 16 U.K. Cooperation with the Energy Community Contracting Parties

1. Where the Member States and the Energy Community Contracting Parties cooperate in the process of the establishment of risk assessments and preventive action plans and emergency plans, such cooperation may include, in particular, identifying the interaction and correlation of risks and consultations with a view to ensuring consistency of preventive action plans and emergency plans across the border.

2. With respect to paragraph 1, Energy Community Contracting Parties may participate in the GCG upon invitation by the Commission on all matters of mutual concern.

Article 17 U.K. Monitoring by the Commission

The Commission shall carry out continuous monitoring of security of gas supply measures and report regularly to the GCG.

The Commission, on the basis of the assessments referred to in Article 8(7) shall, by 1 September 2023, draw conclusions as to possible means to enhance the security of gas supply at Union level and submit a report to the European Parliament and to the Council on the application of this Regulation, including, where necessary, legislative proposals to amend this Regulation.

Article 18 U.K. Notifications

The risk assessment, the preventive action plans, the emergency plans and all other documents shall be notified to the Commission electronically through the CIRCABC platform.

All correspondence in connection with a notification shall be transmitted electronically.

Article 19 U.K. Exercise of the delegation

1. The power to adopt delegated acts is conferred on the Commission subject to the conditions laid down in this Article.

2. The power to adopt delegated acts referred to in Article 3(8), Article 7(5) and Article 8(5) shall be conferred on the Commission for a period of five years from 1 November 2017. The Commission shall draw up a report in respect of the delegation of power not later than nine months before the end of the five-year period. The delegation of power shall be tacitly extended for periods of an identical duration, unless the European Parliament or the Council opposes such extension not later than three months before the end of each period.

3. The delegation of power referred to in Article 3(8), Article 7(5) and Article 8(5) may be revoked at any time by the European Parliament or by the Council. A decision to revoke shall put an end to the delegation of the power specified in that decision. It shall take effect the day following the publication of the decision in the Official Journal of the European Union or at a later date specified therein. It shall not affect the validity of any delegated acts already in force.

4. Before adopting a delegated act, the Commission shall consult experts designated by each Member State in accordance with the principles laid down in the Interinstitutional Agreement of 13 April 2016 on Better Law-Making.

5. As soon as it adopts a delegated act, the Commission shall notify it simultaneously to the European Parliament and to the Council.

6. A delegated act adopted pursuant to Article 3(8), Article 7(5) and Article 8(5) shall enter into force only if no objection has been expressed either by the European Parliament or the Council within a period of two months of notification of that act to the European Parliament and the Council or if, before the expiry of that period, the European Parliament and the Council have both informed the Commission that they will not object. That period shall be extended by two months at the initiative of the European Parliament or of the Council.

Article 20 U.K. Derogation

1. This Regulation shall not apply to Malta and Cyprus for as long as no gas is supplied on their respective territories. For Malta and Cyprus the obligations laid down in, and the choices those Member States are entitled to make pursuant to, the following provisions shall be fulfilled and made within the specified time calculated from the date when gas is first supplied on their respective territories:

(a) for point 5 of Article 2, Article 3(2), Article 7(5) and point (a) of Article 14(6): 12 months;

(b) for Article 6(1): 18 months;

(c) for Article 8(7): 24 months;

(d) for Article 5(4): 36 months;

(e) for Article 5(1): 48 months.

In order to fulfil the obligation contained in Article 5(1), Malta and Cyprus may apply the provisions contained in Article 5(2), including by using non-market-based demand-side measures.

2. Obligations related to the work of the risk groups set out in Articles 7 and 8 with regard to the Southern Gas Corridor and Eastern Mediterranean risk groups shall start to apply from the date when the major infrastructure/pipeline enters the test operation.

3. For as long as Sweden has access to gas via interconnections exclusively from Denmark as its only source of gas and its only possible provider of solidarity, Denmark and Sweden shall be exempted from the obligation in Article 13(10) to conclude technical, legal and financial arrangements for the purpose of Sweden providing solidarity to Denmark. This shall not affect the obligation of Denmark to provide solidarity and to conclude the necessary technical, legal and financial arrangements to that effect pursuant to Article 13.

Article 21 U.K. Repeal

Regulation (EU) No 994/2010 is repealed.

References to the repealed Regulation shall be construed as references to this Regulation and shall be read in accordance with the correlation table in Annex IX.

Article 22 U.K. Entry into force

This Regulation shall enter into force on the fourth day following that of its publication in the Official Journal of the European Union.

It shall apply from 1 November 2017.

However, Article 13(1) to (6), the first and second subparagraphs of Article 13(8), and Article 13(14) and (15) shall apply from 1 December 2018.

This Regulation shall be binding in its entirety and directly applicable in all Member States.

Done at Strasbourg, 25 October 2017.

For the European Parliament

The President

A. Tajani

For the Council

The President

M. Maasikas