Agreement between Fluxys Belgium and the CREG on the fair margin
Fluxys Belgium, Fluxys LNG (hereinafter "Fluxys Belgium") and the CREG have agreed to propose to the market some adjustments to the tariff methodology. In an environment characterised by high inflation and volatile and rising interest rates, these adjustments will allow Fluxys Belgium's margin to reach a fair level for the period 2024-2027.
Fluxys Belgium and the CREG have agreed on certain changes they wish to make to the tariff methodology for the natural gas transmission system, the natural gas storage facility and the LNG facility for the regulatory period 2024-2027. The CREG and Fluxys Belgium believe that these changes are necessary to guarantee the system operators a fair return on the capital invested in the regulated assets, and to enable them to make the necessary investments in order to carry out their duties.
The tariff methodology, adopted in June 2022, provides for the use of a risk-free rate of 1.68% to calculate the margin for the four years of the 2024-2027 regulatory period. In the current context of high interest rates volatility, an overall upward trend over the last two years and a particularly high inflation in 2022, the CREG and Fluxys Belgium have agreed to make the following three changes to the risk-free rate:
1. Set the risk-free rate annually ex-post based on the evolution of the 10-year OLO rate actually observed on the markets;
2. Keep the 1.68% rate currently included in the tariff methodology as a minimum guaranteed value;
3. For investments made before 01/01/2022, if the 10-year OLO rate increases above 2.87%, only half of the increase of the 10-year OLO rate above 2.87% will be reflected in the risk-free rate. For investments made as from 01/01/2022, the entire increase of the 10-year OLO above 2.87% will be included in the risk-free rate.
The impact of these changes will be covered by the regularization account. The tariffs set by the CREG for the 2024-2027 period therefore remain unchanged at this stage.
A public consultation on these changes will be held on the CREG website from the 14th of March to the 14th of April 2024.
Press contact
Press team: 4 •
About Fluxys Belgium
Fluxys Belgium is a Euronext listed subsidiary of infrastructure group Fluxys headquarted in Belgium. With 900 employees the company operates 4,000 kilometers of pipeline, a liquefied natural gas terminal totalling a yearly regasification capacity of 174 TWh and an underground storage facility.
As a purpose-led company, Fluxys Belgium together with its stakeholders contributes to a better society by shaping a bright energy future. Building on the unique assets of its infrastructure and its commercial and technical expertise, Fluxys Belgium is committed to transporting hydrogen, biomethane or any other carbon-neutral energy carrier as well as CO2, accommodating the capture, usage and storage of the latter.
