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Consultation on Gas Networks Ireland proposals on Connections Policy

The CER is today, January 30th 2015, opening a hosted consultation on a submission from
Gas Networks Ireland (GNI) to the CER on revisions to the existing GNI Connections Policy.
Gaslinks Network Development Plan 2014-2023 indicates that aggregate annual demand
across the system is expected to fall by 6% over a ten year period. Given that the gas
network costs are largely fixed and sunk, this declining demand would lead to an increase in
unit network tariffs in the long run, and ultimately consumer bills. To address this situation, a
number of policy areas must be looked at, including policies on new gas connections, to see
if they can stimulate demand efficiently i.e. without significant additional network
infrastructure. The review of the Connections Policy performed by GNI is geared toward the
collective interest in increasing numbers of users of the network and increasing throughput
on the system in a way that is expected to bring benefit to the existing and future customer
base.
The aim of this review of the Connections Policy by GNI is consistent with the CERs
response to the Department of Communications, Energy and Natural Resources Green
Paper on Energy Policy in Ireland, published in May 2014. In its response, the CER drew
attention to the benefit of initiatives that support increased usage of the energy networks.
Provided such initiatives do not trigger significant extra network build, the cost of the overall
network may be spread across a greater number of users, particularly new loads with a
flatter load profile such as data centres, or loads that are currently met by more emissionintensive energy sources (such as transportation and space heating).
The existing Connections Policy has been in place, largely unchanged since 2006. While a
number of minor amendments have occurred in the interim, no fundamental review of the
Connections Policy has been carried out since then. In light of this, over the past number of
months, the CER has been engaging with GNI to assess the Connections Policy and
whether it is allowing the full extent of potential economic new customer load to be exploited.
Separate to this review of the Connections Policy, GNI is working on furthering public
awareness of the availability and benefits of natural gas versus other fuels.
GNI propose seven action areas across a range of different issues. Some of the proposals
contain a number of initiatives for consideration.
The proposals relate to
1. Amendments to Financial Security Criteria

2. Inclusion of Transmission Revenue in the appraisal of new connections to the


network
3. Amendment to the category of Institutional I&C Customers
4. In-fill (Existing Gas Areas)
5. Group sites Different entities on the same corridor
6. Group sites Same entity in different locations
7. Treatment of Compressed Natural Gas Connections
While the CER welcomes the review undertaken by GNI, the proposals set out here are
solely GNIs proposals. The CER has not come to a view on the proposals and seeks the
input of stakeholders on these prior to reaching any final view. In relation to Proposal 7
(Treatment of Compressed Natural Gas Connections), the CER would especially welcome
the views of prospective users or suppliers of CNG.
For ease of reference a copy of the current Connections Policy is published in tandem with
the GNI proposals.
This consultation will close on Friday, March 13th 2015. Stakeholder responses should be
sent to Barry Hussey at either
bhussey@cer.ie, or in hard copy to;
Barry Hussey
The Commission for Energy Regulation
Belgard Square North
Tallaght
Dublin 24