Working group proposes that natural gas markets be opened
In its report published on 21 January 2016, the working group set up by the Ministry of Employment and the Economy proposes that the Natural Gas Market Act be reformed and the wholesale and retail natural gas market be gradually opened to competition.
The main aim of the proposal is to create the preconditions for opening Finland's wholesale and retail natural gas markets to competition. The Balticconnector gas pipeline as well as the investments currently under preparation in the gas infrastructure in the Baltic States and Poland will change the situation at the beginning of the 2020s. In connection with the opening of the natural gas market, the natural gas transmission grid would be unbundled from the sale of natural gas.
"By increasing competition and the number of alternatives for procurement it is possible to create conditions for a favourable development in the industry, and at the same time improve the security of Finland's energy supply and reduce consumer prices," says Minister of Economic Affairs Olli Rehn, who received the working group's proposal.
The industry will become less heavily regulated
Another key aim is to improve the competitiveness of natural gas in the fuel markets and to lessen regulation concerning companies in the natural gas business. The number of regulations that apply to the supply of natural gas would be reduced by giving up price regulation in wholesale of natural gas, and by limiting supplying sellers' price regulation to natural gas supplied to small users and directly to residential buildings in retail.
Provisions on the entry of liquefied natural gas to the markets as well as access rights and tariffs regarding off-grid liquefied natural gas terminals would also be added to the Natural Gas Market Act. The market access for biogas would be enhanced. It is also proposed that more detailed provisions on consumer rights and natural gas contracts signed by consumers be included in the act.
The act is expected to enter into force gradually from 1 January 2017. The proposal includes a transition period estimated to last until 2020, during which the intention is to transfer to an opened market.
The report of the working group, written in the form of a legislative proposal (in Finnish)
Markku Rajala, Special Adviser to the Ministerial Counsellor, tel. +358 50 345 8490
Arto Rajala, Senior Government Adviser, Chairman of the working group, Ministry of Employment and the Economy, tel. +358 29 506 4828