1. Why Ukraine have to unbundle the gas transmission Operator?
We are launching the new feed - "The Unbundling of the gas transmission Operator" where we will tell you what the unbundling is and what it consists of, the steps that still need to be done for its successful completion by us or third parties. We understand the subject a bit technically confusing, so we are ready to answer your questions and will gladly accept ideas for the next posts about the things you want us to tell.
Thus, post first.
Independence of the gas transmission system Operator is one of the main commitments Ukraine has made in the Association Agreement with the EU (in particular, the implementation of the provisions of the Third Energy Package). In 2015, the Law of Ukraine "On the Natural Gas Market" approved the legislative framework of the natural gas market functioning principles, including the unbundling mechanism.
In fact, this means integration of the EU energy market principles in Ukraine. The independence of the GTS Operator ensures that all gas market players are in equal position. Accordingly, a vertically integrated company, in particular the Naftogaz Group, should not affect the operational activities of the GTS Operator. In Central Europe, the vast majority of GTS Operators went through a process of separation from their parent companies in the mid-2000s. Thus, this created preconditions for the unified and competitive gas market in the EU.
The implementation of the requirements of the European legislation actually opens the “energy borders” of Ukraine. This, on the one hand, creates additional opportunities for attracting new foreign clients. On the other hand – to find potential partners who can invest their experience and resources in the development of the GTS and the Ukrainian gas market. Such a possibility is in accordance with the current legislation of Ukraine. Moreover, a joint working group has already been set up with five leading European operators interested in supporting the process of unbundling and further possible involvement in the management of the Ukrainian GTS. The experts of these companies assist Ukrtransgaz in establishing an independent Ukrainian GTS operator.
Support from the European side is essential for negotiations with Gazprom on maintaining the volume of transit of Russian natural gas to EU countries across Ukraine. Today, transit revenues are about 3% of the country's GDP.
The process of preparation for the full separation of the GTS operator of Ukraine is confidently nearing completion. It is planned that after confirmation of certification by the State Regulator and the Secretariat of the Energy Community, on January 1, 2020, GTS Ukraine Operator LLC will withdraw from the Naftogaz Group. It will then be transferred to the management of an organization authorized by the Cabinet of Ministers of Ukraine. In other words, it will start independent activity.