OGP GAZ-SYSTEM S.A.
GAZ-SYSTEM
OGP GAZ-SYSTEM S.A. is Poland's state-owned strategic gas transmission system operator.
Lobbying Activity
GAZ-SYSTEM urges phased implementation of industrial decarbonization requirements
3 Jul 2025
Message — GAZ-SYSTEM recommends introducing new green procurement rules progressively, beginning with voluntary criteria before making them mandatory. They also support favoring European products to strengthen energy security and strategic autonomy.12
Why — A gradual transition protects the operator from immediate supply chain risks and higher costs.3
Impact — Non-EU manufacturers risk being excluded from the European market due to strict origin requirements.4
GAZ-SYSTEM urges immediate regulatory clarity for nuclear-powered hydrogen
25 Oct 2024
Message — GAZ-SYSTEM requests a dedicated regulatory framework for using low-carbon electricity sources like nuclear power. They recommend making calculations for mixed renewable and low-carbon fuels optional. They also argue that solid carbon from gas processing should be treated as a product.123
GAZ-SYSTEM urges connecting hydrogen valleys to wider transmission networks
5 Sept 2023
Message — Integrate local hydrogen valleys into larger national and EU-wide transmission networks for security. Address regulatory barriers and permitting delays for large-scale production and infrastructure. Use the roadmap to accelerate mid-stream investments for national hydrogen network development.12
Why — Interconnection would enable the operator to secure investments for nationwide hydrogen infrastructure projects.3
Response to Revision of EU rules on Gas
13 Apr 2022
GAZ-SYSTEM welcomes the opportunity to express its views in the public consultation on the recast of the Gas Regulation. Please find attached GAZ-SYSTEM feedback.
Read full responseResponse to Revision of EU rules on Gas
12 Apr 2022
GAZ-SYSTEM welcomes the opportunity to express its views in the public consultation on the recast of the Gas Directive. Please find attached GAZ-SYSTEM feedback.
Read full responseResponse to Review of Directive 2012/27/EU on energy efficiency
19 Nov 2021
GAZ-SYSTEM welcomes the opportunity to express its views in the public consultation on the proposal for a directive on energy efficiency (hereafter EED). Energy efficiency is a key tool to achieve emission reduction targets and use more effective technologies. GAZ-SYSTEM takes steps in this direction by further enhancing efficiency of its network operations and by delivering natural gas as a low carbon fuel to be used by applying efficient gas technologies.
EED, to fulfil its role, should duly consider regional specificities across the EU. From the Polish perspective this means that the Polish energy market is largely based on solid fossil fuels (i.e. coal and lignite). The magnitude of solid fossil fuels is especially visible in the electricity and heat generation sectors considering that approx. 70% of electricity and heat in Poland is produced from coal and lignite. On top of that, 80% of district heating systems in Poland are inefficient and thus require refurbishment and fuel switch. Households in Poland consume 87% of coal used across the whole EU for heating purposes. Furthermore, air pollution resulting from burning high emission and low-quality fuels, especially in the winter period, constitutes a serious socio-economic problem in Poland with an adverse effect on public health and life expectancy.
The energy transformation is a process that requires capital-intensive investments in technologies and infrastructures that provide a high value to the society, especially considering that climate objectives need to reconciled with the need to ensure affordable energy prices for consumers. Hence, adequate EU financial support should be made available to foster the energy transition in member states dependent on solid fossil fuels.
The draft EED strengthens the existing legal framework and thus supports the potential for improving energy efficiency. However, some proposed regulatory measures may require further consideration. Therefore, it is proposed to:
- allow member states greater flexibility so that tailored solutions (i.e. adjusted to national, regional circumstances) may be applied to enhance energy efficiency;
- reconsider the criteria of efficient district heating and cooling systems and of high-efficiency cogeneration to take into account the transitional role of gas CHPs. This is evident especially in countries with a high share of coal-based heating generation and considering the need to guarantee required temperatures and provide adequate capacities in district heating systems;
- consider energy savings resulting from the use of natural gas when counting towards the fulfilment of energy savings obligation in the period after 1 January 2024;
- clarify the energy efficiency first principle in relation to network planning, network development and investment decisions undertaken by infrastructure operators that also act to meet public interest objectives. This is achieved among others by implementing investments to ensure security of supply and connect customers and end users to the grid;
- include in tariffs all costs borne by regulated transmission and distribution network operators to map and reduce network losses;
- clarify the role of and the scope of direct actions undertaken by transmission system operators as obliged parties to achieve energy savings among final customers and vulnerable consumers.
Read full responseMeeting with Kadri Simson (Commissioner) and
8 Nov 2021 · Gas market and security of supply framework.
Response to Revision of EU rules on Gas
10 Mar 2021
GAZ-SYSTEM welcomes the opportunity to provide the European Commission with a gas TSO view on the proposal for a revision of the EU rules on market access. Having in mind the current status of development of energy markets in different regions, including those that are highly dependent to coal and lignite, GAZ-SYSTEM is convinced that the ramp-up of the new gases market will go in parallel to the functioning of a natural gas market. Therefore, we believe that the current revision of gas legislation should cover both: amendments to the existing natural gas legislation to enhance efficiency of its functioning and rules for regulation of the new gases.
With regard to the current natural gas regulation, GAZ-SYSTEM submits some initial proposals to be included in the gas directive, regulation as well as in network codes. In our view the implementation of these changes will strengthen the efficiency and competitiveness of market functioning and create more transparency and clarity with regard to the published data.
With regard to the design of the market for new gases, GAZ-SYSTEM would like to highlight some pillars to underpin future market development:
- Regulation for new gases (hydrogen) should be based on the existing gas market legislation and included therein;
- Gas TSOs and other gas system operators should be entitled to own and operate the hydrogen infrastructure;
- The development and integration of “big infrastructure” will go hand in hand with development of local networks;
- The value of gas infrastructure for the whole system should be properly recognised. Gas infrastructure may contribute towards deeper market integration by balancing variable renewable electricity as well as by transmitting different kinds of gases (blending);
- Development of dedicated networks along with repurposing of the existing gas infrastructure are the ways leading to the well-functioning markets in a cost-efficient basis;
- Technology neutrality is crucial to ensure the systems are decarbonised in the most efficient way that duly considers regional circumstances;
- We propose to add some additional definitions in the gas directive to enable the development of new gases;
- Hydrogen infrastructure planning should be included in the TYNDP process for gas and closely interlinked with the European electricity network development plan;
- Standards regarding gas quality & technical cooperation should be as harmonized as possible, however taking regional and local differences in the gas quality into consideration;
- Natural gas as well as new gases will also play a pivotal role in decarbonisation of heating;
- Transition as a chance for deepening EU energy security – the possibility for producing renewable energy/gases and low-carbon gases in the EU should be taken as a priority in order to gain competitive advantage of the EU.
Read full responseResponse to Revision of the guidelines for trans-European Energy infrastructure
5 Mar 2021
GAZ-SYSTEM welcomes the opportunity to participate in the public consultation on TEN-E revision. The Regulation plays an important role in facilitating the development of the EU energy networks. The application of dedicated measures foreseen in TEN-E prove useful and successful to accelerate the implementation of projects in the gas sector. These investments remain key to meeting the objectives of an integrated, competitive and diversified gas market. This will be make largely possible once the gas PCI projects in Poland and other CEE countries are commissioned in the upcoming years.
The experience gained so far illustrates that the gas PCI projects also positively influence sustainability as they contribute towards emission reduction, support the uptake of variable RES and mitigate the air pollution.
In order to sustain that revised TEN-E remains fit for purpose and considers an evolving role of gas infrastructure GAZ-SYSTEM puts forward the following suggestions:
Natural gas will continue to play an important role in the decarbonisation of EU Member States, especially countries that remain dependent on carbon intensive energy sources. The shift away from hard coal and lignite may only be successfully achieved in the short and medium term if the EU regulatory framework allows gas infrastructure to be used in the decarbonisation process. To this end, the TEN-E framework should consider the need for gas infrastructure upgrades and extensions in regions where the current gas network does not allow the supply of appropriate volumes of gas fuel to existing and new customers (e.g. coal to gas switch in the electricity and heating generation). These investments can be made “hydrogen ready”, thereby contributing to effective transport of both methane and hydrogen.
Smart gas networks are aimed at ensuring the possibility of using the surplus energy produced from renewable sources in the form of biomethane and hydrogen by enabling the injection of their blends into the gas network. Under this concept, the gas network acts as a storage facility for RES and it allows to efficiently transport renewables from production points to distant consumption points. The implementation of this concept requires investments not only in digital technologies as proposed by the Commission but also new investments and modernisation of gas infrastructure elements, including valves, compressor stations, metering infrastructure to enable the injection of blends into the transmission network. Revised TEN-E Regulation should reflect the need for the wider scope of necessary investments in smart gas grids.
The development of the future hydrogen backbone is expected to be largely based on repurposed pipelines today owned and operated by the gas TSOs. Clarification on the legal aspects of owner- and operatorship of hydrogen infrastructure is necessary in order to allow gas TSOs to implement hydrogen projects without legal risks.
Low-carbon hydrogen will play a key role in scaling up hydrogen production capacities to meet ambitious objectives set by the European Commission. Therefore, low-carbon hydrogen should also be considered in TEN-E Regulation to support decarbonisation of various industries.
The proposed revision of TEN-E Regulation reinforces oversight over the TYNDP scenarios by ACER and the Commission. It is proposed that ACER will be empowered to develop a framework guideline that will define the process of developing and approving the TYNDP scenario report. The Commission's proposal seems to be based on the solutions adopted in relation to gas network codes. However, TYNDP scenarios are a different process that requires specific expertise in modelling and scenarios. The assumed objectives may be achieved more efficiently by including an additional Annex to TEN-E Regulation already at the stage of the ongoing legislative procedure and by further strengthening stakeholder cooperation in the scenario development processes.
Read full responseResponse to Proposal for a legislative act on methane leakage in the energy sector
26 Jan 2021
GAZ-SYSTEM welcomes the possibility to provide comments to the European Commission proposal on new rules to prevent methane emissions. Herein, we would like to highlight the main points that in our view should be taken into consideration while working on the subject legislation. Broader explanation is attached in the pdf file.
- We fully support the EC efforts to come up with a joint methodology to calculate emissions with differentiation on each element of the infrastructure. However, we would like to highlight that such a methodology should take into account the currently existing local circumstances.
- GAZ-SYSTEM believes that the costs borne by regulated entities in order to mitigate and limit methane emissions should be recognized by NRAs.
- GAZ-SYSTEM believes that in order to provide a level playing field for external suppliers, the scope of the regulation should cover the whole supply chain of gas.
- We also believe that OGMP 2.0. should remain a voluntary initiative during the transitional period and it should turned into the legislation after this time;
- We believe that in order to ensure smooth and efficient data collection, there should be one international entity collecting the methane emission related data;
- In GAZ-SYSTEM opinion legislation on LDAR projects should be of a general nature to ensure the most cost and time efficient implementation of such programmes by concerned companies;
- Venting and flaring should be allowed in exceptional circumstances;
- Each market participant subject to the planned regulation, should be responsible only for emissions from its own scope of business, infrastructure or the infrastructure it operates on;
- The potential savings in the emissions due to the transition towards low emission sources (e.g. natural gas) should be also taken into consideration while assessing the climate value of the gas transmission systems;
- Emissions caused by a system failure shall not be calculated within the scope of the targeted emission reductions.
Read full responseResponse to Climate change mitigation and adaptation taxonomy
18 Dec 2020
Please find attached the position paper of GAZ-SYSTEM in the public consultation on sustainable finance – EU classification system for green investments.
Read full responseResponse to Revision of the Energy and Environmental Aid Guidelines (EEAG)
10 Dec 2020
GAZ-SYSTEM welcomes the opportunity to take part in the consultations on the guidelines on state aid for environmental protection and energy measures (hereafter the guidelines).
One of the main priorities of the European Green Deal is the decarbonisation of the energy sector, a fair transformation of the so called coal regions and thus a gradual introduction of changes both in the social aspect and in the way the energy carriers are used. Therefore, the guidelines should be adjusted to accommodate the new policy objectives, new innovative solutions, while ensuring an overall adequacy of the energy system, affordable energy and a secure energy system.
The energy markets across the EU are set to undergo the energy transformation towards low and zero-emission sources of energy. This process will take a special character in Poland and other EU countries that remain highly dependent on carbon intensive fuels and where the share of natural gas and renewables is limited.
Considering the above the revised guidelines should include the compliance assessment of investments that apply innovative technologies to expand and adapt the gas infrastructure towards increasing the transmission and distribution possibilities of gaseous energy carriers (natural gas, biomethane, hydrogen and synthetic methane).
The system of incentives and direct investment support schemes in the area of gas infrastructure will contribute towards the implementation of EU objectives in an efficient manner. This will be done in short and medium-term by exploiting still largely untapped potential to achieve significant emission reductions with the switch from carbon intensive fuels towards natural gas and by accommodating the increasing uptake of renewable with natural gas. In the mid and long-term perspective the gas grids will contribute towards the deployment of renewable and decarbonised gases (biomethane, renewable and low-carbon hydrogen, synthetic methane) through adapting the existing infrastructure or by considering relevant requirements for new investments.
Measures to support a gradual change in this direction will constitute an important incentive for the transformation of energy systems. In this respect, they would also ensure the integrity of the entire EU energy system.
Read full responseResponse to Revision of the Renewable Energy Directive (EU) 2018/2001
21 Sept 2020
GAZ-SYSTEM welcomes the opportunity to take part in the public consultation on Renewable Energy Directive 2018/2001 (RED II) and comment on the scope of future EU renewable energy policies.
GAZ-SYSTEM is of the opinion that the EU climate objectives should be implemented by promoting both renewables and low-carbon/decarbonised energy sources. Therefore, any changes in the RED II shall be focused on incentivising of R&D&I initiatives and providing technology neutrality. This will in turn guarantee that the cost and time efficient transition can be achieved taking into account the existing market differences within EU Member States.
With reference to the option proposed in the consultation paper, GAZ-SYSTEM supports Option 2: the non-regulatory measures, as the energy transformation will not be possible without significant financial support. Nevertheless, it must be emphasized that such financing should encompass all renewable, decarbonised and low carbon technologies that can contribute to reducing CO2 in different market sectors.
Based on above circumstances GAZ-SYSEM is convinced that future renewal of EU policy toward renewable energy sources (regardless of a need to amend the RED II Directive itself) should support both R&D&I initiatives and infrastructure-related projects that focus not only on green hydrogen but also low-carbon and decarbonised alternatives. Green hydrogen will most probably not be available in required volumes and within the price competitive framework in the short-term perspective. Therefore, the development of blue hydrogen is necessary to scale up the hydrogen market and support the decarbonisation process. At the same time the use of decarbonised gases in industrial processes and transport could also substantially contribute to reduction of CO2 emissions in those markets. Thus, if the RED II Directive is to be revised, it should also encompassed different types of decarbonised gases including blue hydrogen.
The future EU measures should support R&D&I initiatives to ensure that renewable, decarbonised and low carbon gases may be delivered from production sites to customers in a safe way and in appropriate volumes. This may be done by either retrofitting existing infrastructure or by constructing dedicated assets. EU financial support schemes will help implementing required investments by network operators, in particular in initial stage of market development to cover the funding gap.
Due to actual small demand levels such investments may not be economically viable and will not be possible without substantial external funding. Therefore it is essential that not only hydrogen but also other renewable, low-carbon and decarbonised gases such as synthetic methane or biomethane are supported by the new EU policy, as they may be transported in existing gas pipelines and in this way delivered to potential customers. The use of these gases allows different market sectors to transform gradually as a result of economic balance between supply and demand.
Read full responseResponse to EU Methane Strategy
4 Aug 2020
GAZ-SYSTEM as the Polish Gas Transmission System Operator is strongly committed to provide consumers with a secure, affordable and climate friendly energy supply. It is even of more importance in the CEE region, dealing with one of the highest air pollution in Europe. GAZ-SYSTEM has already implemented a number of actions focused on monitoring. These activities include:
• pipeline inspection using intelligent pigging as part on Integrity Management system;
• helicopter flights on the route of the controlled infrastructure as part of the LDAR program;
• alternative analysis, e.g. using the Metal Magnetic Memory Method;
• active corrosion protection and local measurements through Direct Current Voltage Gradient;
• direct reduction of methane emission (hermetic isolation of in-service sections of pipe, decreasing the pressure in the transmission system for the needs of planned maintenance, depletion of gas with the use of gas stations).
GAZ-SYSTEM welcomes the European Commission initiative to consult the Roadmap for the methane emission strategy and would like to express its full support for the creation of a common monitoring, reporting and verification system. When developed, such a system will be the first step to properly assess the amount of methane emissions and efficiency of actions taken to mitigate them. The system should be designed after thorough consultation with market participants representing the whole value chain. GAZ-SYSTEM would be willing to take part in such works and contribute to the achievement of a common solution.
GAZ-SYSTEM believes that there are certain areas that should be tackled in the strategy such as:
• clear definition of the methodology how to calculate emissions with differentiation on each element of the gas infrastructure;
• emission caused by the system failure – as the amount of emissions released due to a system failure differ and cannot be predicted since they depend on the type of a specific event. Thus, it is impossible to calculate the average amount of methane emissions resulting from a system failure and to cover them in the obligation to decrease methane emissions. Therefore, the amount of methane emissions and targeted emission reductions should only be based on emissions released from gas infrastructure components under a direct control of a given operator;
• costs of actions taken in order to decrease methane emissions should be addressed to ensure their acceptance by regulators;
• classification of methane emissions which should be divided into the sources of origin.
Each market participant subject to the planned regulation, should be responsible only for emissions from its own scope of business, infrastructure or the infrastructure it operates on. In order to make the strategy effective, it is crucial to provide a clear framework for each part of the value chain, taking into consideration its technical as well as regional specificities. This is especially important with regard to the CEE region, where natural gas is indispensable to foster the energy transition (i.e. coal to gas switch is a quick win for the both emission reduction and consumers, gas supporting the uptake of variable RES). Thus, the potential savings in the emissions due to the transition towards low emission sources (e.g. natural gas) should be also taken into consideration while assessing the climate value of the gas transmission systems.
To ensure that methane emissions decrease, the strategy or any following regulation should be technology-neutral and flexible, to enable the development of a competitive market and possible inclusion of new technologies. However, there is a need for the strategy to encourage producers of the equipment to develop more precise solutions also for all market participants. From the TSO perspective, currently there is no methane emission measurement tool having desired parameters on the market.
Read full responseResponse to A EU hydrogen strategy
8 Jun 2020
Recognition of hydrogen in a future decarbonised energy system is highly welcomed by GAZ-SYSTEM. Considering EU decarbonisation goals GAZ-SYSTEM would like to underline that there is already existing natural gas infrastructure that should be analysed to meet the future goals, as well as well-developed regulations on how to ensure the creation of a competitive market. While taking dedicated actions to repurpose the gas system for the needs of decarbonised and renewable gases the current state of affairs cannot be forgotten.
GAZ-SYSTEM believes that the role of blue hydrogen should be recognised not only in the transition period but also in the longer run (e.g. perspective of 2050). Defining role of blue hydrogen as transitional puts into jeopardy further development of the technologies dedicated or connected to development of e.g. blue hydrogen (such as CCS/U). Therefore, the role of blue hydrogen should not be limited to the transitional fuel – only then the technology neutrality can be achieved.
Grey hydrogen produced within industrial processes should be taken into consideration as well as an important part of the strategy. As energy intensive sectors will need to fulfil climate goals, grey hydrogen can be an important tool towards reaching this obligations.
GAZ-SYSTEM agrees with the EC that there is a need to ensure that the EU action should be taken to ensure cost and time efficient development of the hydrogen market. However, such an EU level action should take into consideration the right of each Member State to decide on their own energy mix as well as the regional and national specificities of each Member State. Thus, the strategy should not pose member state binding hydrogen targets such as predefined percentage of H2 injection in EU gas transmission systems. The strategy should also pave the way for the application of tailored solutions across the EU. Depending on supply, demand and market considerations different technologies (e.g. grid, off-grid solutions, blending, dedicated H2 grids) may be utilised to foster hydrogen markets and meet climate objectives.
The hydrogen market should be developed in a regulated manner taking the most of the existing gas infrastructure that could be analysed in which scope it can be adjusted as well as regulations related to the gas sector that should be applied to hydrogen respectively. Therefore, to kick-start the hydrogen market in the EU it is of utmost importance to ensure the same regulatory framework as for natural gas in Third Energy Package (including third party access, unbundling rules etc.). However, such rules cannot be simply mirrored from the gas related regulations. New framework should take into account already existing technological and market needs to ensure cost and time effective development of the hydrogen market.
While developing new hydrogen infrastructure in Europe and its future legal framework, TSOs should be entitled to own and operate assets to transport and store H2 and other gases. TSOs may well build on their solid experience to develop these new markets.
The strategy should envisage proper incentives for the entities willing to invest in hydrogen infrastructure, as well as to ensure possibility to invest in relevant installations to the market users that could significantly contribute to the deployment of desired technologies. GAZ-SYSTEM believes that incentivising, not only SMEs for development of hydrogen technologies, is of a great importance, as large companies whose operation is crucial for energy security can burden bigger risks related to early developed market such as hydrogen, as well as ensuring at the same time broader diffusivity of hydrogen technologies throughout EU.
Summarizing, GAZ-SYSTEM is of an opinion that future hydrogen programmes and strategies should include not only provisions for dedicated new hydrogen infrastructure, but also to include potential of existing natural gas infrastructure.
Read full responseResponse to Revision of the guidelines for trans-European Energy infrastructure
8 Jun 2020
TEN-E Regulation plays an important role in facilitating the development of the EU energy networks. The application of dedicated regulatory measures foreseen in TEN-E Regulation prove useful and successful to accelerate the implementation of projects in the gas sector. These investments remain key to address specific infrastructure categories in Central-Eastern Europe as provided for in article 4, paragraph 2, letter b (namely security of supply, market integration, competition).
The experience gained so far illustrates that the gas PCI projects also positively influence sustainability. This is relevant as the energy markets in Central-Eastern Europe (CEE), including Poland, are largely based on solid fuels. 47% of the primary energy in Poland comes from solid fuels, while the share of natural gas and renewables is limited (15% and 13%, respectively).
The magnitude of solid fuels is especially visible in the electricity and heating sectors considering that 74% of electricity in Poland is produced from coal and lignite while the share of coal in heating totals 72%. On top of that, 80% of district heating systems in Poland are inefficient and thus require modernisation and fuel switch. Households in Poland consume 87% of coal used across the whole EU for heating purposes.
Furthermore, air pollution resulting from burning high emission and low-quality fuels, especially in the winter period, constitutes a serious problem in Poland.
Against this background natural gas is a low emission source of energy that may well bring environmental benefits in CEE and the same time accommodate the need for affordable solutions for the society:
• Gas infrastructure delivers natural gas as a low emission source of energy to the power, heating sectors and other industries and enables CO2 reduction with the switch from carbon intensive fuels towards low emission sources.
• Natural gas provides reliable and flexible back-up for intermittent renewables that will be deployed in the coming years in Poland (e.g. wind power, solar PV).
• Natural gas is an efficient energy source that may be used efficiently to mitigate air pollution resulting from burning high emission and low-quality fuels. This may be achieved in a timely and cost-efficient manner with the connection of households, heat and power plants to the gas grid and the wider use of LNG and CNG in inland and maritime transport.
• Gas grids contribute towards the deployment of renewable and decarbonised gases (biogas, green and blue hydrogen, synthetic methane) through adapting the existing infrastructure or by considering relevant requirements for new investments.
Untapped opportunities arising from gas-to-power and gas-to-heat solutions in Poland and other CEE countries should be duly considered when revising the TEN-E Regulation. These developments will contribute towards the decarbonisation process in a cost-efficient manner and at the same time prepare the energy system for the transition towards renewable and decarbonised gases.
When evaluating TEN-E Regulation attention should also be drawn on the cross-border requirements. In order to be labelled as PCI, projects must involve two or more Member States or located on the territory of one Member State. It should be noted that projects with an impact on GHG emission reductions, by definition, represent a cross-border benefits. It would therefore be appropriate to amend TEN-E Regulation in order to ensure that for gas investment projects as set out in Annex II.2 that contribute towards GHG reductions in the EU, the requirement to involve two or more MSs would not represent a limitation.
Read full responseResponse to Climate Law
30 Apr 2020
GAZ-SYSTEM welcomes the opportunity to comment on European climate law. Comprehensive regulation that supports the implementation of the EU climate goals is already at hand. The Regulation 2018/199 provides a robust and transparent governance mechanism as the Member States are obliged to develop and regularly update their integrated national energy and climate plans. The ongoing dialogue between the Commission and the Member States (i.a. through Commission’s recommendations) as well as transparency standards, are the best course of action to ensure that agreed goals are met, while maintaining the adequate division of competence in the field of energy between the EU and the Member States.
Therefore, there is no need to introduce new procedural provisions if all Member States agree to raise a specific target. It should be noted that any new legislation proposal should be carefully assessed in order to exclude imposition of a new, unnecessary administrative burden and to ensure sufficient flexibility for the Member States to develop their own paths leading towards the ultimate objectives.
In light of the above the proposed regulation is not without some deficiencies. The Commission’s competence under Article 3 (1) to set out (in a delegated act) a trajectory to achieve the climate-neutrality objective until 2050, which according to the Article 6 (1) (a) will be a benchmark for the assessment of the Member States’ actions as well as the whole procedure indicated in Article 6, indeed affects the Member States’ right to determine the most suitable way to achieve this goal, while taking into consideration regional specificities, including socio-economic aspects. Moreover, these provisions unnecessarily introduce a new control procedure duplicating the one from the Regulation 2018/199. Therefore the proposed regulation must be treated as not fully compliant with requirements arising from principles fundamental to EU legal order, that is the principles of subsidiarity and proportionality.
Moreover, according to Article 290 (1) TFEU a legislative act may delegate to the Commission the power to adopt non-legislative acts of general application to supplement or amend certain non-essential elements of the legislative act. However, the essential elements of an area shall be reserved for the legislative act and accordingly shall not be the subject of a delegation of power. In this context setting out a trajectory to achieve climate-neutrality cannot be treated as non-essential part of the proposed regulation. On the contrary, it constitutes an essential component since the trajectory will be considered as a benchmark for evaluation of progress on national and EU levels. Thus, delegating the power to the Commission to set out that trajectory is not in line with Article 290 TFEU, as concluded also by the legal services of the European Parliament.
The gas sector has developed a variety of technologies that may well be used at different stages to support the implementation of EU climate targets. These opportunities are relevant in particular in Poland and other CEE countries where high-emission energy sources represent a large share of the national energy mix.
Natural gas has vast potential to supplement hard coal in household heating sector (87% of coal used in the EU residential sector is used in Poland) and in district heating which is 72% coal-based. 80% of district heating systems in Poland are inefficient and require modernisation and fuel switch. Currently there is no alternative for natural gas in municipal district heating systems. GAZ-SYSTEM is obliged by the government to develop transmission system in order to provide possibility to connect residential and municipal clients to the grid.
Natural gas provides reliable and flexible back-up for intermittent renewables that will be deployed in the coming years in Poland (e.g. wind power, solar PV.
Complete position paper of GAZ-SYSTEM is attached.
Read full responseResponse to Climate change mitigation and adaptation taxonomy
27 Apr 2020
GAZ-SYSTEM welcomes the opportunity to comment on sustainable finance. There is a need to define the sustainable investments in an unified manner taking into consideration regional specificities, including socio-economic aspects. Therefore, consistency should be ensured between the Sustainable Investment Regulation and the delegated acts that will introduce technical requirements. Remarks must also be raised to the TEG final report and its effect on the energy markets in Central-Eastern Europe (CEE) as this report will serve as the basis for the establishment of these technical criteria.
The Regulation excludes only the solid fossil fuels from the eligible investments. However, the TEG report seems to disregard the differentiation between fossil fuels as introduced during the legislation process. The report suggests to extend the exclusion also to natural gas. By doing so, it puts natural gas as an equally climate negative fossil fuel as coal or other solid fossil fuels. Such an approach will hinder the path of CEE countries towards long-term climate objectives. It may well also endanger actions undertaken to decrease air pollution in a timely and affordable way.
GAZ-SYSTEM believes that gas infrastructure should play a key role in mitigation of climate change, especially in CEE. Eurostat data indicates a large share of high-emission sources of energy in the energy mix in countries located in this region. In some cases, these sources far exceed 50% of the mix. Similar conditions hold true for instance in the power generation and heating sectors. This illustrates that promotion of natural gas and development of gas infrastructure can contribute to decrease of solid fuels usage in the CEE region. Such policy will contribute significantly towards substantial emission reductions, will support integrating intermittent RES and hence implementing the long-term EU climate objectives. Moreover, the cogeneration based on natural gas may well be used to overcome air pollution resulting from burning high emission and low-quality fuels, especially in the winter period. It is a particular concern in CEE as it constitutes a serious problem in many communities and affects adversely people’s health.
Taking the above into consideration GAZ-SYSTEM is of the opinion that it is necessary to extend the scope of technical criteria to cover the construction and operation of natural gas and LNG infrastructure as eligible activities under the taxonomy. This proposal is justified by the necessity to provide an equal treatment between gas and electricity infrastructure. This is relevant as gas grids contribute towards the development of renewable gases (i.e. biogas, green hydrogen, synthetic methane) through adapting the existing infrastructure or by considering relevant requirements for new investments.
GAZ-SYSTEM welcomes the explicit inclusion in the final TEG report of the retrofitting of the gas networks for hydrogen. The gas industry is working in parallel on various technologies to gradually decarbonise the gas system in order to support achieving the EU climate and energy objectives.
In relation to the power generation and/or production of heat/cool, it must be underlined that indicated carbon intensity threshold (i.e. 100g CO2e/kWh) may exclude utilities based on natural gas which operation has a significant positive impact especially in highly coal-dependant regions. It should be borne in mind that EU secondary legislation must be compatible with the Treaties. This includes article 194 TFEU which indicates that any measures introduced by the EU cannot affect a member state's right to determine the conditions for exploiting its energy resources, its choice between different energy sources and the general structure of its energy supply.
GAZ-SYSTEM proposes to raise the emission limit over 100gCO2e/kWh, as to include modern installations based on natural gas as eligible projects for the purpose of the future technical criteria.
Read full responseResponse to FuelEU Maritime
24 Apr 2020
GAZ-SYSTEM Capital Group supports the European Commission's plan to accelerate the implementation of low-carbon shipping and port operations by supporting the deployment of alternative, sustainable energy sources and vessel propulsion. In terms of climate and air quality, LNG in the maritime sector should and will play a key role in achieving these goals.
The European Commission's market report of 7 April 2020 states that for the first time in the fourth quarter of 2019 LNG has become the second gas source for the EU, an increase of 42% yearly. DG ENER expects the global LNG markets to develop further and new gas volumes from the US, the Middle East, Africa and even Australia will flow into the European market.
The existing EU infrastructure provides sustainable and flexible logistics services in ports. These services can be further provided as part of small-scale LNG services, including bunkering, to deliver LNG to an increasing number of LNG-powered ships, provided that investments are made in the deployment of LNG-powered ships. The number of LNG-powered ships has increased from 96 in 2016 to 175 in 2019 and further 203 ships are expected by 2026. The bunkering infrastructure in Europe followed a similar trend, with 131 installations offering bunkering services in 2019 compared to 113 in 2018. For this positive trend to continue, the EU authorities must continue to support and expand the LNG bunkering infrastructure.
The use of LNG is a direct response to the sulphur limit adopted by the International Maritime Organisation (IMO). The sulphur content of LNG is negligible (max. 5 ppm), i.e. 1000 times less than the level required by IMO - 0.5%. LNG improves air quality in urban areas and ports. The presence of nitrogen oxides (NOx) is reduced by up to 95% and particles by 99% compared to those achieved with heavy fuel oil.
An independent Thinkstep study commissioned by SEA-LNG and SGMF shows that by using LNG as a marine fuel it is now possible to reduce GHG emissions by up to 21% compared to current oil-based marine fuels throughout the Well-to-Wake life cycle. The SEA-LNG study "LNG as marine fuel - Our future with zero emissions starts now" concluded that even in demanding scenarios where LNG is heavily criticised for the environmental impact, its price would be much more stable and competitive compared to the price uncertainty of other competing fuels. Moreover, assuming a 10-year depreciation period, LNG as a fuel is currently the most economical option and can provide a strong basis for future emission reductions through the use of Liquefied Biomethane (LBM, BioLNG) and Liquefied Synthetic Methane (LSM) as the required technology develops.
In addition, a study commissioned by SEA-LNG in CE Delft concludes that both LBM and LSM are scalable solutions for the maritime sector, with estimated sustainable global supplies potentially exceeding shipping needs in the future and likely to be commercially competitive with other low and zero carbon fuels.
Since the 90s, methane slip has been reduced fourfold: Gas-fuelled engines were originally developed in the 90s to address local emissions, i.e. NOx and SOx. GHG emissions were not a concern at that time. Since then, methane slip decreased 4 times, where appropriate, and engine manufacturers continue to invest in R&D to further reduce the release of natural gas. Therefore, not only is there a significant potential for emission reductions when selecting appropriate engines from among the available models, but manufacturers are also seeking to further reduce the release of methane.
Read full responseResponse to Fast-track interservice consultation on the 'SEIP including a JTM and the JTF"
12 Mar 2020
GAZ-SYSTEM welcomes the opportunity to take part in the consultations on the Just Transition Fund. GAZ-SYSTEM, as gas TSO, focuses its input on technical considerations related to the energy markets in Poland and more broadly in Central-Eastern Europe (CEE).
The Just Transition Fund is a key policy instrument that should be used for the implementation of EU targets in an efficient manner. It is worth noting that the EU Member States share the same climate and energy objectives in the long run. However, they do have different starting points in their paths towards the energy transition. In this context high-emission energy sources represent a large share of the national energy mix in CEE. In some countries (e.g. Poland) these sources far exceed 50% of the energy mix. Similar conditions hold true in particular in the power & heating generation sectors where solid fossil fuels play a dominant role while the share of low emission natural gas and renewables is very limited.
Against this background, it should be noted that gas investments bring climate and environmental benefits that contribute towards substantial emission reductions in the long run:
- Reduction of CO2 emissions. Gas projects provide incremental volumes of natural gas as a low emission source of energy to the power, heating sectors and other industries and consequently enable the switch from carbon intensive fuels towards low emission sources in coal regions in Poland and CEE.
- Support towards the increasing uptake of renewables. Natural gas provides reliable and flexible back-up for intermittent renewables that will be deployed in the coming years in Poland and other CEE countries (e.g. wind power, solar PV).
- Competitiveness. Maintaining competitiveness of coal regions in Poland is one of the most important challenges. Due to a sharp increase of costs resulting from ETS price hikes, the relative competitiveness of solid fuels decreased significantly compared to natural gas in combination with renewables. The development of coal regions in Poland largely relied on major deposits of solid fuels present in respective areas which were the basic stimulus for the economic development. Therefore, the key factor is to secure competitive and reliable deliveries of energy carriers. The employment in these regions is affected by the economic conditions of the energy market. Therefore, increasing efficiency of energy management and increasing the share of natural gas in power & heating generation sector will allow to keep the employment at a sufficient level and to develop the economy on the basis of the existing human capital in the region.
- Mitigation of air pollution. Natural gas is an efficient source of energy that can be used efficiently to mitigate specific problems faced by citizens. Air pollution resulting from burning high emission and low-quality fuels, especially in the winter period, constitutes a serious problem in many communities and affects adversely health. Therefore, natural gas may help achieve this in a timely and cost-efficient manner in coal regions with the connection of new customers like households, heat and power plants to the gas grid and the promotion of alternative fuels (e.g. LNG and CNG) in the transport sector.
As illustrated above gas infrastructure development provides support to coal regions in Poland that face serious socio-economic challenges deriving from the transition process and hence is compliant with the objectives of the Just Transition Fund. Therefore, GAZ-SYSTEM suggest introducing amendments in art. 5 of the proposal for a Regulation establishing the Just Transition Fund to ensure that investments in the gas infrastructure are considered within the scope of this policy instrument.
As investment expenditures to support energy transition in coal regions are set to be substantial, the financial envelope of the Just Transition Fund should be increased. Adequate financial resources are needed to finance required investments.
Read full responseMeeting with Aleksandra Tomczak (Cabinet of Executive Vice-President Frans Timmermans)
5 Mar 2020 · Gas sector in Poland
Response to European Partnership for Clean Hydrogen
27 Aug 2019
GAZ-SYSTEM welcomes the proposal to establish the European Partnerships for Clean Hydrogen under the Regulation establishing Horizon Europe.
Gas infrastructure has an important role to play in the energy transition as it may progressively evolve to allow the interconnections of different areas where energy is produced and consumed for a global balancing of the energy system.
Already today the gas infrastructure contributes to achieve climate targets in a fast, efficient, affordable and cost-effective manner. Furthermore, the gas industry is working in parallel on various technologies to gradually decarbonise the gas system for tomorrow to ensure that the EU climate objectives are achieved. In this context hydrogen may well play an increasingly important role in driving down emissions and limiting the carbon footprint of gaseous fuels by 2050.
Gas infrastructure provides the flexibility needed to integrate an increasing share of variable renewables into the energy system, whilst guaranteeing secure and resilient electricity, storage, heat and mobility for the EU consumers. Through power-to-gas and other technologies and the optimisation of links between gas and electricity markets, gas infrastructure, with huge storage capabilities, support the integration of renewable energy in Europe. Optimal utilisation of Europe's gas infrastructure will lead to lower societal and investment costs by supporting the operation of electricity grids, reducing price volatilities which have an impact on energy poverty and by truly creating an integrated and interconnected EU internal energy market.
Therefore, GAZ-SYSTEM suggests that the following topics are covered by the upcoming European Partnerships for Clean Hydrogen: development of technologies that enable the use of hydrogen in gas infrastructure, influence of hydrogen on gas transmission lines, influence of hydrogen on gas infrastructure elements (gas stations, gas compressor stations, valves, gas meters), influence of hydrogen on gas quality and gas properties and safety of hydrogen injection.
Read full response11 Jul 2019
TEN-E Regulation plays an important role in facilitating the development of the European energy networks. The application of dedicated regulatory measures foreseen in TEN-E Regulation for the PCI projects (e.g. best practices in the permit granting process and in the regulatory treatment) prove useful and successful to accelerate the implementation of projects in the gas sector. These investments remain key to address specific infrastructure categories in Central-Eastern Europe as provided for in article 4, paragraph 2, letter b (namely security of supply, market integration, competition).
The experience gained so far illustrates that the gas PCI projects also positively influence sustainability. To this end, it should be noted that gas investment projects bring a number of climate and environmental benefits that contribute significantly towards substantial emission reductions in the long-term perspective:
• Reduction of CO2 emissions. Gas PCI projects provide incremental volumes of natural gas as a low emission source of energy to the power, heating sectors and other industries and consequently enable the switch from carbon intensive fuels towards low emission sources. This is important considering that high-emission sources of energy represent a large share of the national energy mix in Poland and other CEE countries.
• Support towards the increasing uptake of renewable energy sources. Natural gas provides reliable and flexible back-up for intermittent renewables that are planned to be further deployed in the coming years in Poland and other CEE countries.
• Mitigation of air pollution resulting from burning high emission and low-quality fuels, especially in the winter period. constitutes a serious problem in many communities and affects adversely health. It is a particular concern in the CEE region. Therefore, natural gas may help achieve this in a timely and cost-efficient manner with the connection of new customers like households, heat and power plants to the gas grid and the promotion of alternative fuels such as LNG and CNG in the transport sector.
• Benefits resulting from hybrid energy systems and sector coupling (integration of gas, electricity, heating and cold energy). The energy transition is a capital-intensive process. Therefore, an approached based on utilization of synergies and enabling optimal use of available potentials of different sectors and systems enables long-term EU objectives to be implemented in an efficient manner.
Considering the above arguments TEN-E Regulation should continue to facilitate the development of natural gas infrastructure projects in order to address its objectives. In this context increasing consideration should be put on contribution of gas PCI projects on EU climate and energy commitments in the long run.
When evaluating TEN-E Regulation attention should also be drawn on the following aspects. Regulation (EU) 347/2013 states that in order to be labelled as PCI, projects must involve two or more Member States or located on the territory of one Member State. It should be noted that projects with an impact on GHG emission reductions, by definition, represent a cross-border benefits. It would therefore be appropriate to amend TEN-E Regulation in order to ensure that for gas investment projects as set out in Annex II.2 that contribute towards GHG reductions in the EU, the requirement to involve two or more MSs would not represent a limitation.
The introduction of a “fast-track” procedure for PCI projects already selected in the previous list should also be considered. In case no major context changes arise from one selection to the following one, PCIs projects should only be monitored and not fully re-assessed. This solution would provide stability of the list and credibility of the process while.
Read full responseMeeting with Adam Romanowski (Cabinet of Vice-President Maroš Šefčovič)
9 Jul 2019 · Agenda of the next Commission in the energy sector
Response to Strategy for long-term EU greenhouse gas emissions reductions
10 Aug 2018
Please find attached the contribution of GAZ-SYSTEM S.A. towards the strategy for long-term EU greenhouse gas emissions reductions.
Read full responseResponse to Multiannual Financial Framework: Connecting Europe Facility 2021-2027
8 Aug 2018
Please find enclosed the position of GAZ-SYSTEM S.A. towards a proposal for CEF Regulation.
Read full responseMeeting with Rolf Carsten Bermig (Cabinet of Commissioner Elżbieta Bieńkowska)
3 Dec 2014 · Meeting with Piotr Kus, Director of Gas Transmission Operator GAZ-SYSTEM S.A. - courtesy visit and presentation of company