On 21 May, the European Commission published a decision, issued in April, certifying SONI Ltd as electricity transmission system operator (TSO) under the unbundling arrangements of the EU's energy liberalisation package.
The role of TSO, the company that operates the high-voltage power transmission grid, is central to the liberalised EU energy market, and the certification arrangements are designed to ensure that the TSO is independent of generation and supply interests, and possesses the necessary resources and responsibilities to develop and operate the transmission system. The NI system is unusual in Europe, in that the transmission system is owned by NIE which is part of an integrated generation and supply business, but operated by an independent system operator, SONI. Rather than the unbundling models adopted in most other Member States, the NI government opted for the exceptional "Article 9(9)" model, in which the applicant is required to demonstrate that the existing arrangements are more effective in guaranteeing the independence of the TSO than the "independent transmission operator" model, in which the transmission business remains vertically integrated but is heavily ringfenced. The certification decision in these Article 9(9) cases is taken by the European Commission itself rather than the national regulator. In accordance with the NI regulations, the application for certification as TSO was originally submitted by NIE, the system owner. However, recognising the reality of SONI's role as grid operator, and on the basis of the NI regulator's intention to transfer key grid investment planning functions to SONI, the Commission decided to certify SONI as TSO.
Bird & Bird partner Peter Willis, who has advised SONI on the unbundling issue, and on its submissions to government and regulators for the past 4 years through a series of consultations and policy decisions, commented:
"I am delighted to see SONI's vital role in operating the transmission system finally recognised in its certification as TSO. I am pleased to have been able to play a part in the process"