With Resolution 50/2018/R/eel of 1 February 2018, the Authority approved a mechanism for recognising charges otherwise not recoverable due to the failure to collect general system charges.
At 31 December 2021 the total receivables accrued by the Company amounted to € 69 million, including billed interest. Such interest was excluded from the mechanism for the reinstatement of general charges by Resolution 300/2019/R/eel and subsequently readmitted to the mechanism by Resolution 495/2019/R/eel.
With Circular no. 2/2020/elt of 30 January 2020, CSEA prepared a method for adding the applications already submitted in order to include the portion relating to interest on arrears invoiced in accordance with the initial provisions of art. 1.4, letter a), number iv) of Resolution 50/2018//R/eel. On 18 February 2020, a formal request to participate in the mechanism for reimbursing the default interest billed was formally submitted and the amount requested was received equal to € 2.9 million on 30 March 2020.
On 27 December 2019 Resolution 568/2019/R/eel was also issued, which provides for the reimbursement of amounts due not otherwise recoverable relative to network services equivalent to the model for the recognition of uncollected general system charges.
This mechanism was confirmed with Resolution 461/2020/R/eel published on 19/11/2020, which better defined the methods for access to the reimbursement request. This Resolution included recognition of tariff fees for electricity metering, distribution and transmission services, the UC3 and UC6 tariff components and certain fees for specific services, regarding invoices expired by at least 12 months, net of a 10% deductible.
The Authority set date of 30 June 2021 as the limit for presentation of applications for admission to the mechanism, nevertheless offering DSOs the option, to request a 50% advance of the reimbursement amount due with requests to be sent by 7 December 2020 and payment by 31 December 2020. Areti SpA therefore decided to take advantage of this option, sending a request for participation on 4 December 2020. The total amount for network services for Gala for network tariffs uncollected is approximately € 11.0 million, while the amount paid by CSEA with value date 30 December 2020 as payment of balance was € 5.4 million. On 30 June 2021, the request was completed to settle the shortfall due to the non-collection of the network services tariffs; as established by art. 2.5 of Resolution 461/2020/R/eel, the CSEA, having approved the application for admission sent by areti, recognised with value date of 28 September 2021, the amount of € 5.1 million as the balance of the uncollected Gala network tariffs.
In July 2021, the additional 2021 request regarding the reinstatement of the general system charges was also submitted to CSEA, as provided for in CSEA Circular no. 13/2021/elt. As a result of the collection received from Gala in June 2021, following the Court of Rome ruling no. 8096/2021, areti has taken steps to make the calculations for the restitution of the general system charges collected in the previous requests. These calculations resulted in the amount to be repaid to CSEA, equal to approximately € 3.2 million, being paid at the end of October 2021.
Currently, also taking into account the changes in the regulatory framework deriving from the approval of the mechanism for reimbursing general expenses accrued over time, the reduction in the value of the Areti receivable from Gala was prudentially determined.
From the regulatory perspective, with the aforementioned Resolution no. 32/2021/R/eel of 2 February 2021 published on 5 February 2021, ARERA made provisions related to the mechanism for recognising, in favour of sellers, the general system charges not collected from end customers and already paid to the distribution companies, with the strategic aim of improving the risk management tools through the implementation of measures intended, on the one hand, to guarantee the system and end customers with respect to the economic consequences of possible sales operator default and, on the other, to ensure the solidity and reliability of the processes involving them, keeping their exposure under control and contained with evolution of the minimum guarantee systems and the recovery mechanisms for unpaid payments of sellers with particular reference to the portions related to general system charges in the electricity sector.
The measure, which concluded the procedure to comply with the rulings of the aforementioned administrative courts, follows the guidelines expressed in the consultation document no. 445/2020/R/eel and establishes a mechanism for recognising, in favour of sellers, the general system charges not collected from defaulting end customers and in any case already paid by the sellers to the distribution companies, by providing for their payment by the CSEA. Furthermore, the measure supplemented the rules on guarantees in the transport contracts, regarding their sizing with reference to general system charges.
The Mechanism covers the period between 2016 (entry into force of the Standard Network Code) and any adoption of specific measures, including legislation, aimed at a different management of the collection chain of general system charges and the related system of guarantees.
Parties that benefit from it are therefore users of the transport system provided by the distribution companies, holders of existing or terminated transport contracts which, as sellers, are the only contractual counterparty with the obligation to pay general system charges to the distribution companies (pursuant to art. 3, paragraph 11 of Italian Legislative Decree 79/99).
At the same time, the measure continues to require that the distribution companies have the right to request (and the sellers, users of the transport service, must provide): (a) suitable guarantee of payment of the entire fee for the service, including the part related to general system charges, albeit at a conveniently reduced amount so that it represents the best estimate of the amounts normally collected by the sellers from their end customers; (b) payment of the total amount of the fee invoiced and therefore also any portion of the part related to any general system charges not (yet) collected, now without prejudice to the benefit of the reimbursement mechanism envisaged by Resolution 32/2021.
Resolution 32/2021 therefore confirmed:
- the obligation, arising from primary legislation, for the seller to pay in full the system charges invoiced by the distributor, which in turn has the obligation to repay them in full to GSE and CSEA;
- the right of the seller, limited to the charges not collected from end customers but paid to the distributor, to access the offsetting mechanism set out by Resolution no. 32/2021;
- the regulatory framework previously envisaged with Resolution 109/2017, including the obligation for the seller to provide the guarantee in favour of the distributor, according to the parameters indicated herein related to the best estimate of the amounts normally collected from end customers;
- recognition of the right of the distributor to govern contractually with the seller a suitable guarantee clause for compliance with the seller’s obligations;
- recognition of the right to access the offsetting mechanism in favour of the seller as of 2016, including in the case of a contract terminated by the distributor due to non-compliance (of said seller);
- the obligation of the seller to collect system charges from the end users and, with the professional due diligence pursuant to art. 1176 of the Italian Civil Code, to recover arrears from end 98 customers, being the only party designated to interact with the latter, in fact and in law.
Finally, it is noted that, with notice sent to Areti as a counterparty on 2 April 2021, Gala SpA filed an appeal before the Council of State in order to: (i) ascertain and penalise the alleged non-compliance with rulings of the Council of State nos. 5619/2017 and 5620/2017 of 30 November 2017 and, at the same time, (ii) partially annul Resolution 32/2021/R/eel of 2 February 2021 (on the reimbursement of traders in case of failure to collect the GSCs) due to circumvention of the aforesaid ruling. In summary, Gala considers that the aforesaid rulings of the Council of State – which, by partially annulling the network code, confirmed that system charges apply to end customers (as parties obligated to pay them) and reiterated the absence of the power of the Authority to transfer onto the Traders the obligation to pay the system charges (as deriving from the imposition of guarantees to cover said charges, in addition to the right of the distributors to terminate the contract with the Traders in the event of failure to pay said system charges) — have not been adequately met by ARERA with the subsequent administrative measures issued, the last of which is Resolution no. 32 mentioned, which reiterates the technicalities already omitted, thus breaching the aforesaid rulings.
Given the unusual procedural motion — Resolution no. 32/2021 was not appealed by Gala before the Regional Administrative Court before the deadline and the part appealed before the Council of State was not indicative of new elements with respect to the previous resolutions on the matter — a rejection due to lack of grounds is foreseeable; nevertheless, the intention of Gala could be to obtain the obiter dicta for use in the pending civil cases.
On 1 July 2021 a hearing in closed session was held, after which the Council of State, with an enquiry order, ordered a supplement to the discussions in relation to the parties of the cases defined by the compliant judgements not evoked, namely Green Network SpA, Utilitalia, Aiget - Associazione Italiana di Grossisti e Trader, Esperia SpA and the Bankruptcy Esperia SpA in Liquidation; the Council of State also asked ARERA to clarify the calculation procedure followed for determining the General System Charges normally collected. The case was adjourned to the closed session of 21 December 2021. With an order communicated on 27 December 2021, Gala was put back on time in order to renotify the integration of the cross-examination of Utilitalia; at the same time, the case was referred to Section II for the establishment of the council chamber for discussion of the appeal.
In this regard, it is useful to specify that, from a survey carried out on the portal of the administrative court, three appeals are still pending for the aforesaid Resolution no. 32/2021, one of which (592/2021) filed by the association of traders and resellers “ARTE”. The appeal was entrusted to the same legal expert of Gala and the request addressed to the administrative judge is the same one formulated in the aforementioned compliance proceedings.