GTS’ reaction to draft ACM method decision

01 May 2013

National network operator Gasunie Transport Services (GTS) has taken note of the draft method decision published today by the Dutch Authority for Consumers & Markets (ACM). In this method decision, the regulatory authority presents the regulatory framework for the national gas transport network in the Netherlands for the years 2014-2016.

The draft method decision is a determining factor for setting the tariffs that GTS may take into account for performing its statutory duties. ACM has also published draft method decisions for Tennet and the distribution network operators. During the next six weeks, all interested parties, including GTS, have the opportunity to put forward their reasoned opinions with regard to the draft method decision.

In its first reaction, GTS finds the design and structure of the draft decision consistent with previous decisions.  This is beneficial to the predictability and stability of the regulatory framework and we consider that to be a good thing.  Furthermore, the draft decision presents a robust framework for the changing European regulatory influence on the provision of services by national network operators.  GTS has concerns about the consequences of some areas of the proposed decisions, such as the low level of WACC (Weighted Average Cost of Capital) applied by the ACM and the level of the productivity growth factor used to promote efficient operations. This factor may endanger the quality of the provision of services over the long term.  GTS will mention these points in its reasoned opinion.  It is expected that ACM will publish the final method decision in September.