CRE proposal on how to allocate capacity according to

							 CRE proposal on how to allocate capacity according to
 the Joint Enagas, TIGF and GRTgaz investment plans:
points that have been agreed / still need to be discussed




                       Dominique JAMME
     Director, Gas Infrastructure and Networks Directorate
            Commission de Regulation de l’Energie



             ERGEG GRI South, 4th SG Meeting
                Madrid, October 29, 2007


                                                             1
                             Introduction


•   During the 4th IG meeting of 17 Sep 2007, CRE made a proposal on how to
    allocate capacity resulting from joint Enagas / TIGF / GRTgaz investment
    plan to 2015

•   Proposal contained 1 mechanism for approved investments and 1
    mechanism for other investments

•   Proposal is available on www.ergeg.org / Gas Regional Initiative South

•   Proposal was accepted by IG as a “starting point”

•   Important for shippers to be informed / give us their feedback




                                                                             2
         Investments that have been approved


•   Guyenne phase 1
     • will increase capacity between                                      GRTgazS
     TIGF / GRTgaz South
     •winter capacities shown on the            +240     +15
     right in GWh/d                TIGF

     •summer capacities will also
     increase (not represented on
     diagram)
     • already underway - will be
     completed by end 2008
                                                       +18..5
                                                                            TIGF
•   Larrau phase A and B                                        +110
      • will increase capacity between
      Spain and France at Larrau       Enagas
      •all investments required in
      Spain approved
      •Almost no investment needed
      in France
      •Capacity will become available
      in 2009/10
                                                                       3
    Allocation mechanism for approved investments
•    In France, link capacities between balancing zones will be allocated in an
     OSP in Dec 2007: GRTgazS-GRTgazN and GRTgazS-TIGF

•    IG agreed that

      •Capacity will be sold via open subscription periods
      •Larrau A/B will be held asap, ideally in December 07 but more probably in
      March/April 08
      •OSP at Larrau will be jointly conducted by Enagas and TIGF, under
      regulatory supervision
      • Spanish ministry will publish a norm making joint OSPs possible
      •TSOs will make a proposal by November 17 on other regulatory changes
      needed to ensure interoperability and make joint OSP possible
      •In the meantime, Enagas will inform regulators about any requests for
      capacity at Larrau and about the availability of backhaul capacity at Larrau
      next winter

•    What still needs to be done

      •based on the TSOs’ proposals, make final decisions on product,
      allocation, interface, timing and coordination issues
                                                                              4
      Investments that have not yet been approved
•   Guyenne phase 2 and 3
                                                                        GRTgazS
     •will increase TIGF/ GRTgaz South
     capacity                                       +65       +240
                                           TIGF
     •requires French investments that
     have not yet been approved
     •capacity available in 20010/2011

•   Larrau phase C
                                                          +65           TIGF
      •will increase Spain/France                                +55
      capacity at Larrau
      •investments in Spain decided, but   Enagas
      not yet in France
      •capacity available in 2011

•   Midcat phase 1
     •will create Spain/France capacity
     at Figueras
     •French investments not approved,
     Spanish investments conditionally
     approved
                                                      + 230     + 180
     •capacity available in 2015
     (additional phase possible)                                        5
Allocation mechanism for non-approved investments

  •   The IG still needs to make a decision on these allocation mechanisms

  •   CRE’s proposal is that:
       •market demand must be tested via an open season + capacity must be
       allocated in a coordinated, non-discriminatory, transparent way
       •Larrau C and Guyenne 2/3 open seasons should be run in parallel
       •Option 1: wait for results of Larrau A/B OSP before launching OSs
       •Option 2: organise the OSP and OSs in parallel
       •we should wait for results of OSs before launching Midcat OS
       •Midcat OS could be organised in parallel with OS for GRTgazS-N
       capacity

  •   The IG needs to come to an on the timing of the open seasons

  •   Once these macro issues are solved, TSOs will need to work on the
      implementation




                                                                             6
                 Additional note on Biriatou




•   The TSOs’ investment plan also includes capacity expansions at Biriatou

•   It is especially important that interoperability problems at Biriatou be solved
    if additional capacity is to be built

•   OK to include Biriatou in the OS/OSPs




                                                                               7
                             Timeline




•   Dec 2007: OSP for link capacities in France

•   Option 1: Larrau A/B OSP in March/April 08, then Larrau C and Guyenne
    2/3 OSs in June/July 08

•   Option 2: Larrau A/B OSP and Larrau C and Guyenne2/3 OSs in parallel
    during 1S 2008

•   2S 2008: Midcat and GRTgazS-GRTgazN OSs




                                                                       8