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Georgian National Energy and Water Supply Regulatory Commission

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Georgian National Energy and Water Supply Regulatory Commission Georgian National Energy and Water Supply Regulatory Commission Report on Activities of 2019 Tbilisi 2020 Contents i. Main Directions and Results of the Commission’s Activities .................................................................. 7 1. Electricity Sector ...................................................................................................................................... 13 1.1 Electricity Market ............................................................................................................................... 13 1.1.1. Development of the Regulatory Framework ............................................................................. 13 1.1.2. Current Market Structure and Participants ............................................................................... 15 1.1.3 Preconditions for Developing New Electricity Market Structure and Electricity Market Target Structure compliant with the Electricity Market Model .............................................................. 16 1.1.4. Monitoring Functional, Legal and Ownership Unbundling ........................................................... 18 1.1.5. Main Characteristics of the Market ............................................................................................ 19 1.2. Licensing and Technical Regulation ....................................................................................................... 32 1.2.1 Licensing Applications and Amendments to the License Registry ................................................. 32 1.2.2. Ensuring the Reliability of the Electricity Supply in the Distribution Network........................... 32 1.2.3. The Transmission and Distribution Network Losses ....................................................................... 34 1.3. Tariff Setting and Regulation .................................................................................................................. 35 1.3.1. Tariff Regulations .............................................................................................................................. 35 1.3.2. Current Tariffs of the Sector .......................................................................................................... 35 1.3.3. Investment Project Implementation Analysis ................................................................................. 35 1.3.4. Tariff Benchmarking ......................................................................................................................... 37 1.4. Promotion of Renewable Energy ............................................................................................................ 39 1.4.1. Results of Implementation of Net-Metering Regulation ................................................................ 39 2. Natural Gas Sector ........................................................................................................................................ 42 2.1. Natural Gas Market .................................................................................................................................. 42 2.1.1. Regulatory Frameworks ........................................................................................................................ 43 2.1.2 Market structure and its participants .................................................................................................... 44 2.1.3. Functional, legal and ownership unbundling ...................................................................................... 44 2.1.4. Main characteristics of a market .......................................................................................................... 45 2.1.4.1. Natural Gas Wholesale Market...................................................................................................... 45 2.1.4.2. Natural Gas Retail Market ...................................................................................................... 47 2.2. Licensing ................................................................................................................................................... 54 2.2.1. Natural gas transportation ................................................................................................................ 55 2 2.2.2. Natural Gas Distribution ................................................................................................................... 56 2.2.3. License applications and Amendments in License Registry ........................................................... 57 2.2.4. Results of Technical Regulation ....................................................................................................... 58 2.3. Pricing and Tariff Regulation .................................................................................................................. 59 2.3.1. Legal and Methodological Basis ............................................................................................................ 59 2.3.2. Tariff Regulation and Current Tariffs of the Sector ...................................................................... 60 2.3.2.1 Natural Gas Transportation Tariff .................................................................................................. 61 2.3.3. Analysis of Investment Project Implementation ............................................................................. 64 2.3.3.1. Natural Gas Transportation ........................................................................................................... 65 2.3.3.2. Natural Gas Distribution Activity ................................................................................................. 65 2.3.4. Tariff Benchmarking ......................................................................................................................... 66 3. Water Supply Sector .................................................................................................................................... 69 3.1. Regulatory Framework ............................................................................................................................ 69 3.2. General Overview of the Sector .............................................................................................................. 69 3.3. Licensing and Monitoring Terms of Licensing ....................................................................................... 70 3.4. Continuity of Water Supply and Metering ............................................................................................. 72 3.5. Proper Functioning of Water Supply Systems and Reliability .............................................................. 75 Figure 3.8. provides the information on the volume of drinking water and non-revenue water. ............. 77 3.6. Investments and Tariffs ........................................................................................................................... 78 3.6.1. Investments ....................................................................................................................................... 78 3.6.2. Tariffs ................................................................................................................................................. 80 3.6.2.1. Legal and Methodological Basis ..................................................................................................... 80 3.6.2.2 Current Tariffs of the Sector ........................................................................................................ 80 4. Methodological Activities ............................................................................................................................ 82 4.1. The Amendments Introduced in the Secondary Legislation ................................................................. 82 4.1.1. Electricity Sector ................................................................................................................................... 82 4.1.2. Natural Gas Sector ................................................................................................................................. 83 4.1.3. Water Supply Sector ............................................................................................................................. 84 4.2. Service Quality .................................................................................................................................... 85 4.3. Uniform Conditions of Service ........................................................................................................... 85 4.4. The Projects on Improvement Quality of Regulated Services .......................................................... 86 4.5. Unified Electronic Space for Permits ................................................................................................. 86 3 4.6. USSD Codes ......................................................................................................................................... 87 4.7. Mysterious Shopper Survey ................................................................................................................ 87 4.8. Application Forms Approved by the Commission ................................................................................. 88 4.9. Violation of Licensing Conditions and Sanctioning of Company ......................................................... 88 5. Commercial Service
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