State of compliance
In 2016, Moldova transposed the vast majority of the Third Energy Package by the Law on Natural Gas. Certain transitional provisions of the Law on Natural Gas may hinder the correct implementation of the acquis. Moldova, with significant technical and institutional support from the Energy Community Secretariat, has drafted the core secondary acts that would rectify such uncertainties and correctly transpose the gas acquis. However, very few secondary acts were adopted to date.
Moldova is an important route for the transit of Russian gas to Turkey and the Western Balkans. In recent years, the amount of gas transported through Moldova was around 20 bcm/y.
Diversification of gas supplies in Moldova primarily depends on making operational its interconnector with Romania through the Iasi-Ungheni pipeline, and in particular on its projected extension to Chisinau. Vestmoldtransgaz was sold to Transgaz in 2018 with the obligation of the latter to invest in the Ungenhi Chishianu pipeline.
The Energy Community is assisting Moldovatransgaz to implement the interoperability concept and conclude an interconnection agreement with Ukraine in line with Commission Regulation (EU) 2015/703 (‘interoperability network code’).
Third Party Access
Third Party Access
The Law on Natural Gas transposes the principle of third party access to transmission, distribution and storage networks from Directive 2009/73/EC.
The Law requires that a transmission tariff methodology is established for the individual setting of tariffs for entry and exit points. As this is not yet the case, the Moldovan energy regulatory authority, ANRE, in cooperation with the Energy Community Secretariat, is finalising a draft entry/exit transmission tariff methodology.
The current legislation requires the allocation of monthly and annual capacity for time-horizons up to five years and that interruptible capacity is offered in case of contractual congestion. Secondary market trade of capacities are also in place.
In order to transpose the relevant gas acquis, ANRE and the Secretariat prepared fully compliant transmission and distribution network codes for Moldova. Transparency rules are covered by the draft network codes. However, none of the codes have been adopted so far.
A provision in the Law stating that transmission and distribution system operators shall give priority to natural gas produced on the territory of Moldova contravenes the general principle of non-discrimination, regardless of the scarce domestic gas production.
Moldova’s gas market is entirely monopolized. Major gas market activities in the country remain concentrated within the corporate group of one vertically integrated company – Moldovagaz. The company is responsible for gas imports from Russia and exercises control over the country’s two gas transmission system operators, Moldovatransgaz and Tiraspoltransgaz.
The gas market of Moldova is illiquid. More than 99% of contracted gas import quantities are being acquired from Gazprom.
The Regulation on Access to the Natural Gas Transmission Network and Congestion Management established some rudimentary principles of balancing. The draft gas market rules, prepared in cooperation with ANRE and the Secretariat, transpose the balancing rules comprehensively and even go beyond the applicable acquis. The draft is awaiting adoption.
Through its twelve subsidiaries, Moldovagaz controls about 70% of Moldovan gas distribution networks, and it also acts as a major retail supplier.
All customers are eligible to freely choose and switch their gas supplier. In practice, however, only incumbent suppliers are active in the market. Rules and procedures for supplier switching are adopted, and the supply rules are drafted. End-user price regulation is applied to all customer categories.
Household customers and small enterprises are entitled to regulated gas supplies by the supplier under public service obligations. The Law envisages a concept of last resort supplier for all final customers. Operational rules regulating the supply of gas under public service obligations are yet to be developed through secondary legislation and the supplier (or suppliers) in charge have to be designated.
In contrast to these general principles, the Law effectively and unduly allows that all final customers can benefit from gas supplies under regulated prices without restrictions in time and clearly defined and transparent rules, thus making the Law non-compliant with the Directive’s provisions on public service obligations.
The Law on Natural Gas transposes the requirements of Directive 2009/73/EC with regard to customer protection. It introduces the concept of a vulnerable customer and refers to the relevant social security regulations in the definition.
The Law on Natural Gas transposes minimum security of supply standards and safeguard measures adequately.
The Law on Natural Gas requires from a transmission system operator the adoption of balancing rules designed in a fair, non-discriminatory and transparent manner, but not necessarily market-based. To date, balancing rules and imbalance charges are not implemented in Moldova.