The Verkhovna Rada of Ukraine adopted a Law on amending several legal acts in order to unbundle the gas transmission system on 15 November. As a result, it has created the necessary conditions for establishing an independent system operator (ISO) for gas in line with the EU’s Third Energy Package under the Energy Community Treaty. Following years of inertia and political infighting, the adoption of the Law removes one of the main obstacles to compliance with the Third Energy Package in the country’s gas sector and to the continuation of long-term gas transits from Russia.

The gas ISO, which has already been created within the vertically-integrated gas incumbent Naftogaz, will now have to be transferred to the Ministry of Finance. The ISO will operate the Ukrainian gas pipelines which are and will remain owned by the state.

While the adoption of the Law constitutes a first important step, further measures including the signature of the relevant agreements between Ukrainian companies and authorities and their taking effect on 1 January 2020 will now have to happen swiftly. The unbundling of the gas ISO will have to be certified by the Ukrainian regulatory authority and authorised by the Secretariat of the Energy Community.  

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Press release

EU4Energy Programme