Law 34/1998 of 7 October 1998 on the Hydrocarbons Sector (LSH), which transposes the provisions of Directive 98/30/EC into Spanish legislation, establishes the bases for the organisation of the Spanish Gas System and determines its activity regime.
Since 1998, the regulation of the Spanish gas sector has focused on the objective of achieving the full liberalisation of the natural gas market so that this energy can be supplied at a minimum cost to citizens and companies. This has required a stable regulatory framework that allows the development of the gas infrastructure necessary to meet demand and promote the diversification of gas supply sources to guarantee supply in the face of scarce domestic production.
The basic pillars of the regulatory framework of the Spanish Gas System are: i) Market liberalisation, ii) The separation of regulated activities (regasification, storage, transmission and distribution) and activities in free competition, iii) Free access by third parties to gas infrastructure under objective, transparent and non-discriminatory conditions, iv) The establishment of an integrated economic framework with regulated access tariffs that must be sufficient to recover the costs incurred, v) A remuneration for regulated gas activities that allows the return on capital employed with a reasonable profitability according to a low-risk activity, vi) The assurance of minimum safety and strategic stocks, vii) The protection of consumers, especially the most vulnerable consumers.
With the publication of Royal Decree-Law 1/2019, and in accordance with European regulations, the National Commission on Markets and Competition (CNMC) is conferred with the power, among others, to approve the methodology, remuneration parameters, the regulatory asset base and the annual remuneration of liquefied natural gas transmission, distribution and plants. For its part, the Ministry for the Ecological Transition and the Demographic Challenge is responsible for energy policy, security of supply, gas quality, and the establishment of the remuneration and access framework for underground storage facilities.
