Measures plan for emergencies to mitigate and avoid impacts of natural gas supply distruption in the Czech Republic



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EMERGENCY PLAN
to mitigate and avoid the effects of natural gas supply
disruption
in the Czech Republic

3 December 2012




The Ministry of Industry and Trade of the Czech Republic

Table of contents:

  1. Introduction

  2. Legislation

2.1 European Union

2.2 Czech Republic



  1. Crisis situations and levels

    1. gas industry

    2. Possible causes of emergencies

    3. Crisis levels

  2. Tasks and obligations of gas undertakings and industrial customers

    1. Gas transport

    2. Gas distribution

    3. Gas storage

    4. Gas trade

    5. Industrial customers

    6. Ministry of Industry and Trade

  3. Measures for mitigating the effects of a supply disruption on distance heating

  4. emergency committees and their tasks

5.1. Emergency gas industry undertakings committee

5.2. Central emergency committee



  1. Market measures at the alert level

  2. Non-market measures for a state of emergency and their impacts

  3. Description of mechanisms for cooperation with neighbouring countries at all crisis levels

    1. Prompt warning

    2. Alert

    3. State of emergency

  4. Reporting obligations of gas industry undertakings

    1. Alert

    2. State of emergency

  5. Gas supplies in a state of emergency

11.1. Regional state of emergency

11.2. National state of emergency

11.3. Activities in a state of emergency


  1. Supply disruption scenarios

12.1. Exceptionally high gas demand scenarios

12.2. Failure of the main transmission infrastructure

12.3. Description of the probable consequences by individual scenarios

12.4. Simulation drill for a natural gas supply disruption

12.5. Draft of preventive measures for mitigating identified risks


  1. Consultation with Competent Authorities of neighbouring countries

  2. Conclusion




  1. Introduction

The plan for a state of emergency potentially affecting the security of gas supplies in the Czech Republic has been prepared based on the requirements of Articles 4 and 10 of Regulation (EU) No. 994/2010 of the European Parliament and of the Council of 20 October 2010 on measures to safeguard the security of gas supplies and repealing Council Directive 2004/67/EC (the "Regulation").


The plan for a state of emergency was prepared by the Ministry of Industry and Trade which is the competent authority according to Article 2, clause 2 of the Directive and based on Act No. 458/2000 Coll. on business conditions and public administration in the energy sector and on amendments to other laws (the "Energy Act"), as amended.
A state of emergency in the gas industry and the basic procedures for handling a state of emergency are laid down in Section 73 of the Energy Act. Details of activities for preventing a state of emergency and for a state of emergency are set out by Decree No. 344/2012 Coll. of the Ministry of Industry and Trade on a state of emergency in the gas industry and safeguarding the security standard of gas supply, that divides customers into seven groups according to gas consumption and five consumption levels for restricting gas supplies and five consumption levels for interrupting supplies to individual groups of customers. The last consumption level is the emergency level i.e. the interruption of the natural gas supply to all customers. The decree was amended recently to detail the provisions of Regulation No. 994/2010 of the European Parliament and of the Council and the applicable wording of the power engineering act No. 458/2000 Coll.


List of abbreviations:
MPO Ministry of Industry and Trade

ERÚ Energy Regulatory Office

OTE Energy Market Operator

PPS Transmission system operator

PDS Distribution system operator

PZP UGS operator

VP Gas producer

VO Wholesale consumption

SO Medium consumption

MO Retail consumption

DOM Households

BR Balance difference

PO Direct consumption from the transmission system

GG Green Gas




  1. Legislation

    1. European Union Legislation

The European Union has already looked at the security of the natural gas supply in Directive 2004/67/EC of the European Parliament and of the Council of 26 April 2004 on measures to safeguard the security of the natural gas supply, particularly in the opening articles 16 to 19: "Member States should adopt and publish national emergency provisions" and "this Directive should provide rules applicable to a major supply disruption". A document describing the basic activities required for safe natural gas supplies to customers has been made to safeguard natural gas supplies. Historically, it was the first standalone legislation related to safeguarding the security of natural gas supplies.

The question of safeguarding the security of natural gas supplies was also discussed in the third energy package in Directive 2009/73/EC of the European Parliament and of The Council of 13 July 2009 on common rules for the internal natural gas market and repealing Directive 2003/55/EC. The opening clause (22) states the following: "The security of the energy supply is an essential element of public security and is therefore inherently connected to the efficient functioning of the internal gas market..."In addition, Article 5 of the Directive stipulates: "The security of the energy supply is an essential element of public security and is therefore inherently connected to the efficient functioning of the internal gas market..."

Also Regulation (EC) No.715/2009 of 13July 2009 on conditions for access to natural gas transmission networks and repealing Regulation (EC) No 1775/2005, primarily devoted to the organization of the natural gas market, sets out in Article 1, subsection c):"This Regulation aims at facilitating the emergence of a well-functioning and transparent wholesale market with a high level of security of the gas supply …“

When the first serious crisis in the natural gas supply to the EU member states took place in 2009, it was decided to issue a new more detailed

Regulation (EU) No. 994/2010 of the European Parliament and of the Council of 20 October 2010 on measures to safeguard the security of the gas supply and repealing Council Directive 2004/67/EC based on which this report has been created.


    1. Czech Republic Legislation

Also the legislation at the national level sets out the safeguards for securing the natural gas supply in Act No. 458/2000 Coll. on business conditions and public administration in the energy sectors and on amendments to other laws (the "Energy Act"), in the amendment to Act No. 670/2004 Coll. where the obligations applicable to all gas industry undertakings were laid down for a state of emergency and a state of emergency itself was laid down in Section 73 of the Act. Based on the Act, the implementing directive of the Ministry of Industry and Trade No. 375/2005 Coll. on emergency states in the gas industry was issued with details about the obligations of gas undertakings in avoiding a state of emergency and a state of emergency in the gas industry. Based on the new legislation of the European Union, both the Energy Act as well as the implementing decree were modified with respect to adopting the third package of the energy legislation in 2009. Both the Energy Act No. 458/2000 Coll. as well as the decree on states of emergency in the gas industry were amended and for the first time customers were divided by type and quantity of consumption into seven consumption groups, as well as twelve consumption levels and permitted daily consumption; it was published under No. 334/2009 Coll. as an amendment of the decree on states of emergency in the gas industry.

Because not all changes were successfully implemented in the Energy Act in 2009 and the publication of Regulation (EU) No. 994/2010 of the European Parliament and of the Council of 20 October 2010 on measures to safeguard the security of gas supply legislation changes were required to the Energy Act as well as the implementing decree, another amendment to Act No. 458/2000 Coll. was published under No. 211/2011 Coll. that took into account all the requirements of the third energy package and Regulation (EU) No. 994/2010 of the European Parliament and of the Council.

Then, an amendment of the implementing decree on states of emergency in the gas industry modified customer groups so that the original group C, which contained customer consumption points with prevailing heating consumption with a forecasted annual consumption over 4,200 MWh a year, was divided into C1 and C2.

Customers who provide more than 20% of the produced heat energy of the total produced volume to households, health care facilities and social service facilities are classified in group C1, which includes customer consumption points with prevailing heating consumption with predicted annual consumption over 4,200 MWh a year not classified under group A or D; these consumption points belong to this group if the sum of needs in the last quarter of the previous year and the first quarter of this year is 70% or more of the total consumption for the period from 1 April of the previous year to 31 March of this year;

The new decree on states of emergency in the gas industry and on safeguarding the security standard also defined protected customers who became customers classified in groups C1, D (customers with food production for inhabitants, health care facilities, social service facilities and others), and F (customers with annual consumption up to 630 MWh and households).

Appendix No. 1 of decree sets out the content requirements applicable to the contingency plans of gas facility operators.

In addition, the decree took into account the requirements of Regulation (EU) No. 994/2010 of the European Parliament and of the Council related to processing a risk analysis, preventive action and the emergency plan and secured the cooperation of the gas industry undertakings with identification of the extent of materials submitted in Appendix No. 2.

The new decree on states of emergency in the gas industry and safeguarding the security standard also defines the methods for safeguarding the security standard of supplies for protected customers and proving this in Section 11, its extent and the calculation formulas are specified in Appendices No. 3 and 4.

In this way, the new decree 344/2012 Coll., on states of emergency in the gas industry and safeguarding the security standard of gas supply took into account all the requirements of Act No. 458/2000 Coll. as well as Regulation (EU) No. 994/2010 of the European Parliament and of the Council of 20 October 2010 on measures to safeguard the security of the gas supply and repealing Council Directive 2004/67/EC.
Other legislation documents applicable to a state of emergency in the gas industry:

Act No. 262/2006 Coll., labour code, as amended

Act No. 59/2006 Coll., on preventing serious emergencies, as amended.

Act No. 239/2000 Coll., on an integrated emergency rescue system, as amended.

Act No. 239/2000 Coll., on an integrated emergency rescue system and changes to some other acts, as amended.

Act No. 240/2000 Coll., on crisis management and changes to some other acts, as amended.

Act No. 241/2000 Coll., on economic measures for states of crisis and changes to some related acts, as amended.

Decree of the Ministry of Industry and Trade No. 345/2012 Coll., on dispatch control for the gas network of the Czech Republic and interchange of a data for dispatch control.

Decree of the Ministry of the Environment No. 256/2006 Coll., on details of serious emergencies prevention.

Decree of the Ministry of the Interior No. 103/2006 Coll. on determining the principles for defining an emergency planning zone and the extent and ways of processing an external emergency plan, as amended.

Decree of the Ministry of the Interior No. 328/2001 Coll. as amended by decree No. 429/2003 Coll., on some details for securing the integrated emergency rescue system, as amended.


  1. Crisis situations and levels

    1. Gas industry

The gas industry is defined as interconnected group of high pressure gas pipelines and compression stations and related technological facilities, including control and security system equipment and facilities for transmitting information for IT and IS operation used for the operation of the facilities, interconnected with gas industries abroad, where gas transport is operated by a licence holder for gas transport; the transmission system is constructed and operated in the public interest.

Fig. No. 1 – Gas industry of the Czech Republic


The system consists of:

  • gas production facilities (facilities for gas production or extraction)

  • transmission system (mutually interconnected very high pressure and high pressure gas pipelines and compression stations)

  • distribution systems (mutually interconnected high pressure, medium pressure and low pressure gas pipelines not directly connected to the compression stations)

  • direct gas pipelines (not included in the transmission system or distribution system - additionally constructed for the gas supply to eligible customers)

  • underground gas storage

  • gas connections (connection devices between the distribution system and gas consumption points)

  • technical gas industry control centres (installations that balance resources and gas need as well as the safe and reliable operation of the gas industry system)

The importance of natural gas in the energy balance of the Czech Republic is growing. Its share in the consumption of primary energy resources has been about 20% over the last few years. The resources of natural gas in the Czech Republic are very low. The annual natural gas extraction in the area of Southern Moravia is about 100 mil. m³, which is about 1% of the total annual domestic consumption. The Czech Republic is almost totally dependent on natural gas imports from three different sources - Russia, EU member states and Norway. At present, there are about 20 companies on the liberalized Czech gas market and the highest share of imports was secured particularly by long-term contracts for natural gas supplies in the form of "take or pay". The contracting party of these contracts in the Czech Republic is mainly RWE Transgas, a. s., followed by VEMEX s. r. o.

The long-term contract of RWE Transgas a. s., with Gazprom export LTD. (former Gazexport) for natural gas supplies originally concluded until the end of 2013 has been prolonged to 2035 and the contract with Norwegian producers was concluded until 2017.



VEMEX, s. r. o. concluded a five-year contract with Gazprom export in 2007 for natural gas supplies to the Czech Republic of 0.5 billion m3 annually with an option to double both the term of the contract and the annual volume.
Annual domestic natural gas consumption is about 8 - 9 billion m³.
Table No. 1 Development of actual gas consumptions from 1995 to 2010



Year

average temperature

in winter months

[°C]

average annual temperature [°C]

annual consumption

[Mtoe]

annual consumption [mil.m3]

year-to-year change

[mil.m3]

[]

1995

2.2

8.3

7.336

8 075

1 141

16.4

1996

-0.1

6.6

8.455

9 306

1 231

15.2

1997

1.9

7.9

8.577

9 441

135

1.5

1998

2.2

8.5

8.531

9 390

-51

-0.5

1999

2.3

8.7

8.565

9 427

+37

+0.4

2000

3.7

9.5

8.311

9 148

-279

-2.9

2001

2.2

8.2

8.879

9 773

+625

+6.8

2002

2.8

9.0

8.669

9 542

-231

-2.4

2003

1.2

8.6

8.848

9 739

+197

+2.1

2004

2.1

8.2

8.805

9 691

-48

-0.5

2005

1.4

8.0

8.687

9 562

-129

-1.3

2006

1.8

8.5

8.421

9 269

-294

-3.1

2007

3.5

9.4

7.861

8 653

-616

-6.7

2008

3.7

9.3

7.884

8 685

+32

+0.4

2009

2.0

8.8

7.415

8 161

-524

-6.0

2010

0.7

7.6

8.144

8 979

+818

+10.0

2011

1,4

8.9

7.333

8 085

- 894

-9.7

Energy conversions (public and plant power engineering) 14 %

Power energy sector (gas for crude oil refinery plants) 2 %

Industry (steel and iron production, non-ferrous metals and processing other minerals, chemical industry including refineries, mechanical engineering, food industry) 40%

Business and public services 15 %

Households 28%

Agriculture 1 %

Graph No. 1 Share of natural gas imports in 2011


Considering the dependency on imports, the basis for a reliable natural gas supply to the Czech Republic are the security of diversified resources and concluding long-term contracts with gas producers. It should be noted in this regard that in emergency situations of an international dimension it would be hard to import natural gas from other close areas (the EU states) because they are also, regardless of their internal resources, dependent on imports. The consequences of a serious technological failure of the transit gas pipeline, which has both a transit and source function, needs to be considered.

About 33% and 13% of gas consumed in Germany and France, respectively, goes through the Czech Republic. Disruption of the natural gas supply for Central and Western Europe could also occur if the transmission route in Russia, Ukraine or Slovakia is disrupted.

Storage of gas in underground gas storages is a benefit of natural gas. In addition to domestic gas storage contracts, some gas traders have concluded contracts with foreign gas storage operators. Today, the total gas storage capacity is about 30% of the annual natural gas consumption.





    1. Possible causes of emergencies

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