Agreement for the provision of electricity supply services: practical importance

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You have already obtained a supply electricity license. What comes next? What would be the next steps to finally get started?

In our publications on the site, we elaborate on the institutions you need to get registered in and other permits you need to obtain.

Today we will discuss one of the agreements that shall be signed to get registered as an electricity market participant and to start your activity as an electricity supplier.

This is the Transmission Service Agreement.

Why should the Supplier sign this Agreement?

The conclusion of the Agreement is provided first of all by the Transmission System Code approved by the Resolution of the National Commission for State Regulation of Energy and Public Utilities (hereinafter - the National Commission) No. 309 of 14.03.2018.

This Agreement shall be signed for the purpose of:

transmission of electricity through the network of the distribution system operator (DSO), if the electrical installations of the supplier’s customers are connected to the distribution system;
transmission of electricity through the network of the transmission system operator (TSO), if the consumers’ electrical installations are connected to the transmission system.

Note! In addition to the Transmission Service Agreement, it is also necessary to sign the Electricity Distribution Agreement with the Distribution System Operator (Oblenergo).

Parties of the Agreement

The Transmission Service Agreement shall be concluded by and between the Electricity Supplier and the Transmission System Operator, UKRENERGO, NPC SE. To sign this Agreement, an Electricity Supplier shall prepare and submit a set of documents to the specified operator.

Note! If the documents contain errors, are improperly drafted or the Supplier fails to submit a full set of them, the Agreement will not be concluded. You can always contact our lawyers for legal assistance and support of the procedure.

Ukrenergo, NCP SE shall review the documents, make its decision on signing the Transmission Services Agreement and send the signed Agreement to the Supplier’s address within fourteen (14) business days.

Upon the receipt of the Agreement signed by the Supplier, the Operator shall provide the Supplier with a note of the number and date of the Agreement conclusion.

What shall the Supplier have to conclude the Transmission Service Agreement?

To conclude the Transmission Service Agreement, the Supplier shall obtain the EIC code and the status of a VAT payer.

What affects the amount of the service payment under the Agreement?

The amount to be paid by the Supplier depends on the electricity transmission volume transported through the networks to the supplier’s consumers.

The Agreement price is determined on the basis of the current electricity transmission tariff. The tariff is approved by the regulator and published on its official website.

Conclusion

Conclusion of the abovementioned Agreement is one of the mandatory and most important stages of the procedure for the electricity market participant registration.

Without this Agreement, the Supplier won’t be able to further sign other agreements required for getting registered as a new electricity market participant. The Supplier shall specify the data of the Transmission Service Agreement, when signing other agreements on the electricity market.

This procedure is only one of many stages of registration as a new electricity market participant. If you don't want to waste your time and handle the complicated registration procedure, you can contact our specialists for a turn-key service.

To know more about the characteristics specific to the Transmission Service Agreement or the registration procedure of the electricity market participants, please contact us any way that is convenient for you.

Publication date: 02/07/2019