Missions / Presentation / CRE - CRE

Last updated on : 2007/07/05

Missions


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I. Access to public electricity grids and to natural gas facilities and systems

Historically built under the aegis of the public authorities (State and local authorities), the public transmission and electricity distribution grids, transmission and natural gas distribution facilities as well as LNG facilities form the key to the opening to competition on the electricity and gas markets. Indeed, competition can only be practised on these markets if eligible consumers and operators can access these systems and facilities in fair and non-discriminatory conditions.
In this respect, the missions entrusted to CRE are of the same nature overall, whether they concern the natural gas or electricity markets, except for certain nuances concerning the devolved prerogatives for each of the two sectors.

A. CRE is the guarantor of the right of access to public electricity grids and to natural gas facilities and systems

1. Powers common to the two sectors
CRE, in both the natural gas and electrical sectors:

proposes rates for the use of public electricity grids, natural gas networks and LNG facilities to the ministers for the economy and energy who then have a two month period to raise any objections;
art.4 law 10/2/2000 | art.7 law 03/01/2003

is the recipient, firstly as concerns electricity, of contracts (settled between system operators and users) and protocols (when the operator and user are not separate legal entities) of network access; and secondly as concerns gas, of contracts or protocols of access to transmission and natural gas distribution facilities, storage facilities and LNG facilities, including facilities providing ancillary services, settled between operators of these systems or facilities and eligible customers, suppliers and their representatives;
art.33 law 10/02/2000

receives notification of refusals to settle contracts or protocols relating to access to systems that an operator invokes in relation to requests from users;
art.23 law 10/2/2000 | art.6 law 03/01/2003

can be called upon in the case of disputes arising between users and operators of public transmission and electricity distribution grids, between operators and users of transport and natural gas distribution facilities, between operators and users of underground natural gas storage facilities or between managers and users of LNG facilities in the event of refusal to access or use the said facilities, or in the event of disagreement regarding the execution, interpretation or performance of contracts and protocols of access to the said systems or facilities may be referred to it;
art.38 law 10/02/2000

within this framework, CRE may also have to pronounce protective measures, constraints or penalties.
art.38 et art.40 law 10/02/2000

2. Particularities in each sector:

For access to electrical grids, CRE:

issues a preliminary recommendation on decisions by the competent administrative authority that refuses to authorise the construction of a direct line (private grid)
art.24 law 10/02/2000

For access to natural gas facilities, it:

gives its opinion on exemptions, provided for by decrees in the Conseil d'Etat (State Counsel), from rates for the use of transmission and natural gas distribution networks and LNG facilities, as well as on exemptions brought to commercial terms of use of systems or facilities;
art.7 law 03/01/2003

grants temporary exemptions from rules governing the right to access the networks of companies who are authorised to supply gas, that make a request thereof and fulfil the terms thereof;
art.6-II law 03/01/2003

mask to be sent contracts of access to underground storage facilities signed by operators within the negotiated framework;
art.30-3, II, law 03/01/2003

B. CRE ensures the smooth running and development of the electricity and natural gas facilities and systems

As part of a settlement of disputes, CRE may order, or ask the minister for energy to order, protective measures in the event of a serious and immediate attack on the safety and security of public systems to ensure that they continue to run;
art.38 law 10/02/2000

The Commission is the recipient of the investment programme of system operators or managers: it receives information about projects to develop the transmission or distribution system of natural gas.These projects are drawn up by operators and are about the state of their investment programme. The Commission approves the annual investment programme of the public transmission and electricity grid operators.
art.21 law du 03/01/2003 | art. 14 law 10/02/2000

C. CRE is the guarantor of the independence of system operators

1. The independence of electricity and natural gas system operators

legal entities, which are separate from those which implement generation activities or supply electricity or gas, manage the natural gas and electricity transport systems.
art.5 law 09/08/2004

2. CRE contributes to this independence:

No individual responsible for the general management of an operator of gas or electricity transmission or distribution may be removed without the prior reasoned notice from CRE;
art.6-II and art. 15 law 09/08/2004

all transmission system operators and distribution system operators shall establish a code of good conduct. Each year CRE publishes a report on compliance with these codes of good conduct and on the assessment of the independence of system operators;
art. 6-III and art. 15 law 09/08/2004

CRE also issues a recommendation on the specifications of the transmission system operator which determines the terms for carrying out the missions entrusted to it by law;
art.12-II law 10/02/2000

CRE approves the annual investment programme of the transmission system operator;
art.14 law 10/02/2000

CRE issues a recommendation on the long term development outline of the operator's system and the transmission grid.
art.14-III law 10/02/2000

CRE approves the rules of activities? account unbundling between generation, transmission and electricity distribution and other activities of integrated operators of electricity and between transmission, distribution, storage of natural gas and use of LNG facilities and other activities of integrated natural gas operators;
art.25 to 27 law 10/02/2000 | art.8 law 03/01/2003

CRE approves the rules of account unbundling of activities between supplies to eligible customers and supplies to non-eligible customers of integrated operators of electricity and natural gas;
art.25 to 27 law 10/02/2000 | art.8 law 03/01/2003

CRE has a a role of monitoring and supervision, which is implemented by the possible application of its powers of inquiry and penalty (to check the correct application of the unbundling principles so as to prevent any cross-subsidy, discrimination or restriction on competition);
art.33-34-40 law 10/02/2000

These powers are implemented in liaison with the Conseil de la concurrence (Competition Council) which issues, in particular, a prior recommendation for the application of accounting principles, and may be referred at any moment to the Commission Chairman;
art.39 law 10/02/2000

CRE supervises, in the electricity sector, the organisation of the balancing mechanism and approves the presentation rules of balancing proposals and programmes, as well as the criteria for choosing between the proposals submitted to the public transmission system operator;
art.15 law 10/02/2000

CRE is also empowered to hear disputes relating to contracts (or protocols) - covered in III of article 15 of the law - (electricity purchase contracts, power reservation contracts) that the public transmission system operator can conclude with the supplier of his choice, particularly to compensate for losses relating to electricity conveyance;art.38 law 10/02/2000

II. Market regulation

More generally, the law entrusts CRE with the mission of ensuring the smooth running of the electricity and gas markets.
It monitors the organised markets of electricity and natural gas, as well as cross-border exchanges of these two energies.
art.3 law 10/02/2000 | art. 1 law 03/01/2003

A. the public service: the progressive opening of the market must function by uniting the introduction

In this regard CRE plays a role in accommodating these objectives, since the organisation or funding of the public service has an impact on the operation of the market.
It is on this account that CRE, in particular, in terms of the electricity public service:
assesses the amount of attributable costs to public service missions which are subject to full compensation in the terms which are made provision for in article 5-I of the 10th of February 2000 law;
art.5-I law 10/02/2000

These expenses result in:
- in matters of generation of electricity, firstly, from purchase obligations imposed on EDF or non-nationalised distributors (intended to compensate for the insufficient opening of the market or to promote certain generations within the framework of the energy policy), and secondly, from excess production costs in non-interconnected zones (in French overseas counties (departments) and territories and in Corsica where sales? prices may be capped after recommendation from CRE);
- in matters of electricity supply, firstly, from losses of income and costs borne by suppliers due to the application of the première nécessité (essentials) rate (for low-income families who benefit from a reduction on their electricity bill regarding both subscription and consumption), and secondly, from costs borne by electricity suppliers due to their contribution to the system instituted in favour of people who are financially insecure;

Every year CRE suggests to the minister for energy a sum for public service expenses and a sum for the contribution applicable per kilowatt per hour. It also suggests to the ministers for the economy and energy the amount of reimbursements made in favour of operators with the public service responsibilities;

it assesses the running of the mechanism for compensating public service responsibilities in its annual activity report.

B. The entry of new electricity producers on the market

CRE issues a recommendation on the decree laying down the purchase obligations for small facilities, developing domestic waste or using renewable energy sources (obligation made to EDF and non-nationalised distributors to buy the energy produced by these producers) and the terms for purchasing electricity which is produced this way(rate decrees);
art.10 law 10/02/2000

as part of the long term programme for electricity generation, if the generation capacities do not meet the objectives simply through the interactions of operators' initiatives, the minister for energy may resort to a call for tenders that CRE has the responsibility of implementing. CRE thus drafts specifications, sorts out the offers and issues a recommendation on the applicants, the final choice of these applicants being left up to the minister;
art.8 law 10/02/2000

CRE issues a recommendation on the social measure of the rate mechanism intended to guarantee the right to electricity for financially insecure people, as the law makes provision for ;
art.2-III law 10/2/2000

C. Consumers:

CRE makes a recommendation on the sales rates applied to non-eligible customers. This recommendation aims to ensure that rates cover the costs and do not create subsidies in favour of eligible customers;
art.4 law 10/2/2000 | art.7 law du 3/1/2003