EMERGENCY PLAN FOR SECURITY OF SUPPLY OF NATURAL GAS THE NETHERLANDS

Transcription

1 EMERGENCY PLAN FOR SECURITY OF SUPPLY OF NATURAL GAS THE NETHERLANDS Based on Regulation (EU) No 994/2010 of the European Parliament and of the Council of 20 October 2010 concerning measures to safeguard security of gas supply and repealing Council Directive 2004/67/EC Version December 2012 Energy Market Directorate Ministry of Economic Affairs The Netherlands

2 Introduction Regulation (EU) No 994/2010 of the European Parliament and of the Council of 20 October 2010 concerning measures to safeguard security of gas supply and repealing Council Directive 2004/67/EC (hereinafter the Regulation ) stipulates, among other things, that Member States must draw up an emergency plan detailing the measures to be taken to deal with an unexpected disruption to the gas supply where it is not possible to do so using the more usual measures referred to in the preventive action plan. This plan is the emergency plan for the Netherlands, a country which occupies a unique position within the European Union when it comes to natural gas. Within the European Union, the Netherlands is the largest net exporter of natural gas and is expected to remain a net exporter of natural gas until at least This situation also affects (the contents of) this emergency plan. Given its sizeable domestic production and the option it has of making use of this should imports cease, the Netherlands is relatively immune to an unexpected disruption to the gas supply in (north-west) Europe. This is further reinforced by the fact that Dutch gas production is not dependent on a single source. The Groningen field, the largest source of Dutch natural gas, has over 20 independently operating production sites, in addition to which gas is also extracted from 235 small fields. Consequently, the emergency plan for the Netherlands can be and is relatively simple. As described below, there is, of course, a crisis organisation, which is activated in the event of serious disruption to the gas supply. However, given the situation in the Netherlands with regard to natural gas, there is no need to be able to fall back on non market based measures, and domestic production may and can be relied upon to absorb any gas supply problems. The emergency plan for the Netherlands is developed below, using as its starting point the subjects listed in Article 10(1) of the Regulation for inclusion in the emergency plan. This version of the emergency plan will be submitted to the Dutch gas sector, the surrounding Member States and the European Commission. Their comments will be used to draw up the definitive plan, which will be submitted to the European Commission on 3 December Crisis levels (Article 10(1)(a)) In general, crisis management in the Netherlands involves four distinct phases, which correspond to the timeline of the (impending) crisis: 1. Normal phase: preparing for a crisis by keeping scenarios up to date and through crisis awareness, education, training and exercises. 2. Alert phase: there are signs that a crisis is imminent or that a serious incident needs to be addressed. From the alert phase, it is possible to stand down to the normal phase or to escalate to the crisis phase. 3. Crisis phase: addressing and managing the crisis. 4. Post-crisis phase: standing down crisis organisation, evaluating and adjusting scenarios. The normal phase is upgraded either to the alert phase or the crisis phase, which is known as escalation. There are two types of escalation, namely informative escalation and organisational escalation.

3 Informative escalation Escalation from normal to alert is known as informative escalation. This type of escalation is necessary when a heightened state of alert is needed with regard to the situation and it is essential to be well informed and to be able to exchange information quickly and appropriately. The normal organisational structure continues to be used on the basis of the usual responsibilities. Such escalation is designed to optimise internal and external information exchange, also with a view to preparing for possible escalation to the crisis phase. Organisational escalation This type of escalation is necessary when the day to day organisation cannot anticipate the situation that has occurred or is expected to occur. Organisational escalation makes it possible to coordinate and expedite internal procedures for information exchange, decision-making and taking action. 2. Role and responsibilities of natural gas undertakings and of industrial gas customers (Article 10(1)(b)) In so far as any roles and responsibilities in times of crisis have been defined, they relate only to distribution and transmission system operators. Under Article 51 of the Gas Law, these network system operators are required to draw up an emergency response plan every 5 years. Article 20a of the Ministerial Order Quality aspects of management of electricity and gas networks (Government Gazette (Staatscourant) 2004, 253) lays down more detailed rules with regard to these emergency response plans. The requirements with regard to emergency response plans relate primarily to procedural requirements in the event of a crisis. A rigorous procedure must have been followed to develop the crisis management system, and it must be subject to adequate organisational guarantees. The precise content is the responsibility of the network system operator itself. 3. Role and responsibilities of the competent authorities and of the other bodies (Article 10(1)(c)) The Minister for Economic Affairs (EZ) is the competent authority within the meaning of Article 3(2) of the Regulation. The Minister for Economic Affairs also has political responsibility for energy supply, while the network system operators have operational responsibility. This division of responsibilities means that the Minister is responsible for determining the framework in all phases of crisis management. Within the framework set, the network system operators do what is expected of them. An example of this is that the Minister must indicate whether certain groups of customers or sectors are to be given priority access to energy supply (determining the framework in the response phase). Network system operators then take this into account in their interruption plans. In other words, the Minister has only very limited direct control over the gas and electricity sector. Ultimately, it are the national transmission system operator (GTS for gas) and the distribution system operators that actually have the authority to do something. Another aspect of political responsibility is that the Minister must, at all times, be able to be accountable for his policy and be able to inform the parliament and the general public of the extent, cause and consequences of a crisis. This implies that he must have an extensive and up-to-date network of crisis managers in the sector in order to enable efficient information exchange between the sector and the Minister. A clear distribution of responsibilities also entails resolving a crisis at the lowest level possible (at municipal level for a municipal crisis, at provincial level for a provincial crisis and at national level for a nationwide crisis) and means that other ministries are responsible for their own policy areas (i.e. the Ministry of Safety and Justice for law and order and security, the Ministry of Health, Welfare and Sport for public health, etc.). Cascading dependencies can lead to a crisis in the energy sector spreading to other sectors. Combating this therefore requires an escalation to involve other ministers.

4 The crisis organisation of the Ministry of Economic Affairs is integrated into its day to day organisation. All of the support and policy directorates concerned are responsible for making adequate preparations for and combating a crisis in their policy area. With regard to gas supply, this means that the primary responsibility lies with the Energy Market (EM) Directorate, which is part of the Directorate-General for Energy, Telecommunications and Markets (DGETM). The management team of the Energy Market Directorate nominates a crisis coordinator for gas, who has an important role to play in the field of crisis management, both in the day to day organisation and in the crisis organisation, and maintains contacts with the gas sector. The crisis coordinator is also a member of the Energy Crisis Team (ECT) and the operational EZ crisis team. The Energy Market Director is ultimately responsible for crisis management in the field of electricity and gas and is the chairman of the Energy Crisis Team. At the Ministry of Economic Affairs, the Departmental Coordination Centre for Crisis Management (DCC) is responsible for the general coordination of crisis management, both within the Ministry and on an inter departmental basis. 4. Opportunity for natural gas undertakings and industrial gas customers to respond (Article 10(1)(d)) As stated, the Minister for Economic Affairs has political responsibility for energy supply, while the network system operators have operational responsibility. This division of responsibilities means that the Minister is responsible for determining the framework in all phases of crisis management. Within the framework set, the network system operators do what is expected of them. The Gas Law and the secondary legislation based upon it include a number of provisions intended to guarantee security of gas supply. For example, the Minister monitors security of supply each year. As part of this, he also examines measures to deal with peak demand or the failure of one or more suppliers. The network system operator has an important role to play, especially in guaranteeing security of supply. It is the task of the network system operators to guarantee the safety and reliability of the networks, and they should make arrangements with regard to security of supply. Furthermore, they must have a quality control system relating, among other things, to the safety and reliability of the transmission and distribution service and have sufficient capacity to ensure transmission and distribution. If necessary, the Minister can impose investment obligations on network system operators. The national transmission system operator for gas, GTS, has been given additional tasks and responsibilities by law to make arrangements regarding security of supply. Depending on the seriousness of a possible crisis, GTS will primarily use market based measures, which can be done through the market oriented balancing system. Under this system, all parties (shippers) operating on the gas network must be in balance within a certain period of time. If this does not happen, for whatever reason, GTS has the means to redress the resulting imbalance. It can use the bid-ladder to buy or sell the deficit or surplus of gas on the market. The costs thus incurred by GTS are passed on to the party that caused the imbalance. In a very serious crisis, GTS can give shippers a specific instruction with the aim to restore the balance within the network. In case this does not lead to results and the system remains in a situation of imbalance (the red zone), GTS may call an emergency and can act as described below. GTS may call an emergency situation if and when it is confronted with large, unexpected disturbances in the transmission network, including communication and control systems, which may endanger the integrity of the network. In such a situation GTS take the following measures: (1) use of means which may have been contracted for emergency situations;

5 (2) instructions regarding installations for the storage of gas and LNG and entry point of the transmission network; (3) instructions regarding exit points of the transmission network. This means that exits can be instructed to reduce their off-take or to which off. The effect is that the household sector will be affected last. The legal for these measures to be taken by GTS can be found in the Gas Act, article 17b (7) The network operator op the transmission network may give instructions on the execution of a submitted programme, if this is necessary for the efficient execution of the operator s legal tasks. In addition to these day-to-day tasks and responsibilities, all network system operators must work together to guarantee the transmission and distribution of gas and electricity even in exceptional circumstances. The Dutch Competition Authority s Directorate for Energy and Transport Regulation (DREV) monitors compliance with and implementation of the legislation. 5. Measures and actions regarding district heating and electricity production (Article 10(1)(e)) In the Netherlands, there are no specific State measures or actions regarding gas supply to the district-heating and electricity-production sectors. These sectors also operate on the gas market, either directly or indirectly. In a crisis, they are also protected through the balancing system operated by GTS. When it comes to the supply of electricity and the dependency from natural gas, the Dutch transmission system operator for electricity, TenneT, is currently updating its emergency plan. This plan will be available beginning The current plan only gives limited attention to the interdepency between gas and electricity production, especially in the Groningen area where gas production locations get a preferred treatment when there are disturbances in the delivery of electricity. Furthermore there are generic emergency measures if and when production fails. 6. Procedures and measures to be followed (Article 10(1)(f)) Prior to or during (impending) disruptions and crises, the DCC and the various policy and support directorates have their own tasks, responsibilities and powers within the Ministry s crisis organisation. The Energy Market Directorate s responsibility for (impending) crises in the gas sector is restricted to the downstream sector. Crises in the upstream sector are dealt with by the National Mines Inspectorate (SodM). If a crisis in the upstream sector has repercussions for the downstream sector, the Energy Market Director is involved. Responsibilities The division of responsibilities between the DCC and the Energy Market Directorate is as follows: the DCC is responsible for general coordination of crisis management, both within the Ministry and on an inter-departmental basis; the DCC is responsible for auxiliary matters in relation to crisis management; the DCC identifies the framework within which the policy and support directorates must develop crisis management; The policy and support directorates are responsible for developing crisis management within their own policy or support area, taking into account the framework set by the DCC. Powers Depending on the crisis management phase, decisions are made either by the DCC or by the Energy Market Directorate.

6 In the normal and alert phases, decisions are made by the Energy Market Directorate and action is taken in accordance with the crisis management manual for gas and electricity. In the crisis phase, decisions are made by the DCC and action is taken in accordance with the basic EZ crisis management manual. Distribution of tasks The following tables show the tasks to be performed by the DCC and the Energy Market Directorate, respectively, in each crisis management phase. DCC Acting as the initial and general contact and information point at the Ministry, contactable 24/7. Looking out for/following developments which may indicate a serious disruption in any of the Ministry s policy areas. Coordinating the Ministry s crisis management policy. Conducting inter-departmental and international consultations which do not specifically fall within the remit of the support and policy directorates. Internally guaranteeing and continuously improving crisis management, among other things through a policy on training and exercises. Ensuring that information is gathered and distributed on an (inter-)departmental basis in the field of general crisis management. Providing auxiliary support to the Ministry s crisis organisation before, during and after a crisis. Normal phase Energy Market Directorate Internal and external contact point with regard to crisis management in the gas and electricity sector. Looking out for/following developments which may indicate a serious disruption in its own sector. Informing the sector about its responsibilities, tasks and powers, so that the sector really does shoulder its responsibilities. Maintaining contacts with the sector and, where necessary, putting items on the agenda for the relevant regular consultations that take place. Keeping the sector manual up to date (which includes updating the contact and availability details). Informing the DCC about relevant developments with regard to crisis management in the sector. Participating in crisis exercises held on a departmental or inter-departmental basis or by organisations within the sector. Responsibility for the necessary basic information and keeping it up to date. Alert phase DCC Energy Market Directorate Information exchange with the Energy Information exchange with the DCC Market Directorate (notification, (notification, situation). situation). Deciding on the (de-)escalation level. Advising on the escalation level. Continuously monitoring the latest developments with regard to the current situation. Informing the Communications Directorate of any escalation. Maintaining contacts with partners in the chain.

7 DCC Information exchange with the Energy Market Directorate. Advising the Deputy Secretary-General on the (de- )escalation level. Setting up the necessary crisis rooms. Dealing with the post-crisis phase. Crisis phase Energy Market Directorate Information exchange with the DCC. Setting up the ECT. Member of the Operational Team and the Policy Team. Upon receipt of a notification, there is immediate communication between the DCC and the Energy Market Directorate. The crisis coordinator for gas verifies and gathers the relevant information with regard to the notification received. He then classifies the situation into one of the three crisis management phases (normal, alert, crisis). Once the situation has been classified, the crisis coordinator informs the Energy Market Director and the Head of the DCC. After obtaining advice from the Head of the DCC, the Energy Market Director decides which escalation level to go to. 7. Crisis manager/crisis team (Article 10(1)(g)) If a crisis occurs, the Energy Market Director can summon the ECT. In performing its role, the ECT mirrors the day to day organisation as much as possible and is chaired by the Energy Market Director or a member of the Directorate s management team. The ECT functions as a back office for the staff members of the Energy Market Directorate who have seats in the Ministry s crisis organisation teams, i.e. the Policy Team and the Operational Team. The ECT consists of the following people: chairperson: Energy Market Director or a member of the Directorate s management team; member: crisis coordinator for gas/electricity; member: policy officer at the Energy Market Directorate; member: policy officer at the Energy Market Directorate. The ECT has the following tasks: gathering information and verifying its accuracy with companies and other relevant partners; analysing the information received and producing a summary and overview of critical points; drawing up the measures to be taken; informing and advising the Policy Team and/or Operational Team on the measures to be taken; maintaining contacts with the sector and reporting on this; maintaining contacts with other public authorities and reporting on this; taking minutes of meetings; keeping abreast of incoming and outgoing information and ensuring follow up to information processing and compliance with any feedback sought; ensuring that the information that has already been gathered is accessible; classifying the situation if there are any changes. If the situation changes and can be classified as crisis management phase normal or alert, the Energy Market Director can decide to dissolve the ECT, making sure that the tasks resulting from the ECT are duly transferred to the day to day organisation. 8. Contribution of market based measures (Article 10(1)(h)) It is for the network system operators and other parties operating on the gas market to determine what measures to take to cope with a crisis. The competent authority has no

8 influence on this. However, where appropriate, the GTS can give shippers instructions with the aim of balancing the network and maintaining or restoring that balance (see paragraph 4). 9. Contribution of non-market based measures (Article 10(1)(i)) As stated in the previous paragraph, it is for the network system operators and other parties operating on the gas market to determine what measures to take to cope with a crisis. Consequently, in the Netherlands, no use is made of the non market based measures listed in Annex III to the Regulation (none of which are therefore included in the legislation in force). Only in the case of an emergency and then only as a measure of last resort, GTS can instruct certain exits to reduce their off-take (see section 4). 10. Cooperation with other countries (Article 10(1)(j)) In times of crisis, it may and will be necessary to cooperate with other (surrounding) Member States to cushion the effects of disruption to the gas supply. The Netherlands has no cooperation agreements with other (surrounding) Member States which come into force only in times of crisis. Through the Pentalateral Gas Platform, the Netherlands is engaged in more general cooperation with Belgium, Germany, France and Luxembourg on matters relating to natural gas (operation of the market, security of supply). If required by the nature and scale of a potential crisis, that platform will be used to mitigate its consequences. Furthermore, use will be made of existing regular (diplomatic) relations with Member States and the European Commission where necessary. This will of course depend on the nature and scale of the crisis. The Netherlands also anticipates that there will be a role for the Gas Coordination Group set up pursuant to the Regulation. Cooperation between TSO s In times of crisis, it may and will be necessary to cooperate with other (surrounding) TSO s to cushion the effects of disruption to the gas supply. That is the Dutch cooperates with the TSO s in the surrounding countries and does not have cooperation agreements with other (surrounding) TSO s which come into force only in times of crisis. The dispatching centres of the West-European TSO s have frequent contacts on a daily basis in order to safeguard a smooth operation of the West-European gas transport. In case of an emergency they seek together for practical solutions. Up till now this way of working has assured that no interruption of the gas transport on Dutch border point has happened, leading to situations in which the security of supply would have been jeopardized. The cooperation between TSO s has been formalised in the Third Package (Regulation 715/2009). The formalised cooperation has led to the identification of network related bottlenecks in the Ten Year Network Development Plan of ENTSOG, this in addition to the own analysis of (future) bottlenecks and the market consultation through the two-yearly open seasons by the Dutch TSO. In the Gas Regional Investment Plans for Northwest-Europe a more in-depth analysis is made for the region. This two-yearly plan provides insight in the regional gas supply and demand balance, infrastructure developments, ongoing and planned projects and in the way TSO s cooperate with each other. 11. Reporting obligation (Article 10(1)(k)) Besides the reporting obligation under the Regulation, there are no reporting requirements in the Netherlands other than those mentioned in this emergency plan.

9 12. Predefined actions to make gas available in the event of an emergency (Article 10(1)(l)) Given the situation of the Netherlands with regard to gas, as already described in the introduction, the Netherlands has no predefined actions to make gas available in the event of an emergency. The only exception is the LNG peakshaver installation in Rotterdam. In order to safeguard the security of supply for protected customer in periods of extreme cold weather (-9 / -17 degrees Celsius), GTS has control over this installation. Nor does the Netherlands therefore have any commercial agreements between the parties involved in such actions or compensation mechanisms for natural gas undertakings. The only possible exception to this is the purchase of gas by GTS as a result of the Decree on security of supply (Gas Law) (See the Dutch Risk Assessment and the Preventive Action Plan for further details). However, such purchases take place under strict commercial conditions, compliance with which is monitored by the Dutch Competition Authority s Directorate for Energy and Transport Regulation. Moreover, the whole purpose of such purchases is to deal with a potential emergency situation in time in order to ensure that it cannot and will not occur. As regards the cross border supply of gas, all associated agreements and contracts are in the commercial domain. The competent authority has no involvement in, or knowledge of, these (apart from the contracts that are notified to the competent authority under Article 13(6)(b) of the Regulation).