LAW no. 325 of July 14, 2006 (* updated *)on the public service of thermal energy supply (updated until February 1, 2014 *)

ISSUED BY THE PARLIAMENT

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*) The upgraded form of this enactment until February 1,2014 is carried out by the Legal Department of SC "Centrul Teritorial de Calcul Electronic" S.A. Piatra-Neamţ, (The Territorial Centre of Electronic Calculation, TN) by including all amendments and supplements brought byLAW no. 187 of October 24, 2012.

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*) The upgraded form of this enactment until February 1, 2014 is carried out by the Legal Department of SC "Centrul Teritorial de Calcul Electronic" S.A. Piatra-Neamţ, (The Territorial Centre of Electronic Calculation, TN) by including all amendments and supplements brought by LAW no. 187 of October 24, 2012.

The contents of this document belongs exclusively to SC Centrul Teritorial de Calcul Electronic S.A. Piatra-Neamţ and it is not an official document, having the purpose to inform the users.

The Romanian Parliament adopts this law.

CHAPTER I

General provisions

SECTION 1

Regulatory Domain

ARTICLE 1

(1) This Act regulates the development of the activities specific to public services of thermal energy supply used for heating and making hot water for consumption, or the production, transmission, distribution and supply of thermal energy in a centralized system, in conditions of efficiency and at quality standards, for the optimal use of energy resources, and by complying with the environment protection norms.

(2) The stipulations of this law apply to the public service of thermal energy supply in a centralized system, established and organized in the villages, towns, cities or counties, regardless of their size.

ARTICLE 2

(1) The public service of thermal energy supply in a centralized system is a part of the field of community services of public utilities, and includes all activities related to the production, transmission, distribution and supply of thermal energy, conducted in the administrative divisions under the leadership, coordination and responsibility of the local public administration authorities or community development associations, as appropriate, to ensure thermal energy for heating and making hot water for people consumption, public institutions, social and cultural objectives, and economic operators.

(2) The public service of thermal energy supply in a centralized system is achieved through the specific technical-urban infrastructure belonging to the public or private domain of the local public administration authority or community development associations, that form the system of centralized supply with thermal energy of the settlement or of the Community Development Association, hereinafter SACET.

(3) For the purposes of this law, SACET consists of a set of technological and functional unit consisting of buildings, installations, equipment, specific equipment and measuring instruments for the production, transportation, distribution and supply of thermal energy in the territory of localities, that include:

a) thermal power plant or electric heating central;

b) transportation networks;

c) thermal points/thermal stations;

d) distribution networks;

e) auxilliary constructions and installations;

f) connections, to the points of demarcation/separation of the installations;

g) systems of measurement, control and automation.

SECTION 2

The principles and objectives of the law

ARTICLE 3

The principles of this law are the following:

a) the efficient use of energy resources;

b) the sustainable development of administrative divisions;

c) reducing the environmental impact;

d) promoting high efficiency cogeneration and the use of new and renewable sources of energy;

e) the regulation and transparency of rates and prices of thermal energy;

f) ensuring the non-discriminatory access of users to thermal systems and public service of thermal energy supply;

g) "a condominium - a heating system".

ARTICLE 4

The objectives of this law are the following:

a) ensuring the continuity of the public service of thermal energy supply;

b) ensuring the quality of the public service of thermal energy supply;

c) affordability to consumers;

d) providing the necessary resources for the public service of thermal energy supply in the long term;

e) ensuring safe operation of the public service of thermal energy supply;

f) the transparent highlighting of costs in the pricing of thermal energy.

SECTION 3

Definitions

ARTICLE 5

For the purpose of this law, the terms and expressions below have the following meanings:

1. Access to the system - the right of the operators and users for the connection/branch, under the law, to the thermal systems;

2. heat carrier - the fluid used for the accumulation, the thermal transfer and the transmission of thermal energy;

3. hot water for consumption - hot water used for household or sanitary purposes;

4. authorization - a technical and legal act issued by the National Regulatory Authority for the Community Services of Public Utilities, granting a legal person the permission to mount, to operate, to modify, repair and operate cost distribution systems;

5. competent regulatory authority - the National Regulatory Authority for the Community Services of Public Utilities, hereinafter ANRSC, and the Regulatory National Authority for Energy, hereinafter ANRE;

6. thermal branch - the physical link between a thermal system and user's own installations;

7. condominium - apartment house, apartment building, building - real property from which some parts are individual properties, namely apartments or spaces that are used for other purposes than living, and the rest are parts under common ownership. Through assimilation, a condominium can also be defined as a section with one or more entrances, from the apartment building, in the conditions under which the common property can be delimited;

8. thermal energy consumer - natural or legal person using thermal energy for themselves through their own installations;

9. cogeneration - simultaneous production of thermal energy and electricity and/or mechanics in the thechnological installations specially used for this;

10. the cogeneration power plant - a set of installations, buildings and equipment necessary to produce electricity and thermal energy in cogeneration;

11. convention - a legal document, annexed to the thermal energy supply contract, concluded between an operator and a user, by which the conditions for billing and payment of thermal energy at the consumer level within a condominium are determined;

12. thermal energy distribution - the thermal energy transmission activity from the manufacturer or transport network to the user, including the transformation of the parameters of the heat carrier, made by using thermal systems of distribution;

13. thermal energy supply - activity that ensures, on a contractual basis, the sale of thermal energy between producers and users;

14. thermal energy measurement groups - the combined ensemble made of delivery meter, thermal resistance and integrator, that measure the quantity of thermal energy supplied to a user;

15. the installations of the users - all installations and receivers that use thermal energy supplied, placed after the thermal branch owned or run by the operator;

16. the license - the technical and legal act issued by the competent regulatory authority, which recognizes a Romanian or foreign legal person the statute as an operator of public service of thermal energy supply in a centralized system, as well as the competence, ability and right to provide/render the services covered by this law, and to operate systems of centralized supply with thermal energy;

17. the operator of service - the Romanian or foreign legal person who has the competence and the abilities recognized by license to fully provide the specific activities of public service of thermal energy supply in centralized system; by the decision of local public administration authority or the association of community development, producing thermal energy may be provided by one or more operators;

18. the price - the equivalent of the thermal energy unit supplied to a user;

19. binomial price - the cost of providing in which the equivalent on the invoice on a certain period is allocated per month for a fixed amount, independent of the amount of energy consumed, and on a variable amount, proportional to the consumption during that period;

20. local price - the price formed by the price of thermal energy production and the fees for the services of distribution, supply and transportation, approved by local public administration authority or by community development association, where appropriate, with the approval of the competent regulatory authority, for each operator who is also a supplier;

21. local price for the population - the price for the supplied therman energy, invoiced to the population by SACET, approved by the decision of the local public administration authority or by the community development association, where appropriate, in accordance with the law;

22. thermal energy producer - operator, licensee for thermal energy production;

23. thermal energy production - the activity of transforming primary sources or some forms of energy into thermal energy stored in the heat carrier;

24. point of delimiting/separating the installations - the place where the change of the ownership of the installations of a SACET occurs;

25. the thermal connection - the connection between a thermal system and a thermal station;

26. the thermal system - all pipelines, pumping installations, other than those existing to the producer, and auxiliary installations through which the thermal energy is carried out continuously and in a controlled manner between the producers and thermal stations or users;

27. the distributor of costs - the device with dedimensionless indications, for the use in the cost distribution systems, to indirectly measure the:

a) thermal energy consumed by the heater on which it is mounted;

b) thermal energy contained in the hot water of consumption, and the volume of the hot water of consumption passing through the device;

28. cost distribution - all the actions and activities carried out by a legal person authorized by the competent authority, in order to distribute the costs to the individual properties from the condominium buildings;

29. the public service of thermal energy supply - the public service of general interest which includes all activities carried out for the centralized supply with thermal energy of at least two users connected to SACET;

30. The system of centralized supply with thermal energy - SACET - all technological installations, equipment and buildings, located in a narrowly defined area, linked by a common and functional technological process, for the production, transport and distribution of thermal energy through thermal systems for at least two users;

31. cost distribution systems - an assembly that includes more cost distributors of the same type, fixtures and related installations, mounted in condominiums, that works and is operated by using a specialized calculation program;

32. the performance standard - the technical regulation which establishes the quantitative and qualitative indicators of the public service of thermal energy supply;

33. the thermal station - all installations within a SACET, through which the transformation and/or adaptation of the parameters of the heat carrier to the consumption needs of one or more users;

34. the transport of thermal energy - the activity of the transmission of thermal energy from the producers to the thermal system of distribution or to the users connected directly to the thermal systems of transport;

35. thermal energy user - one or more thermal energy consumers, beneficiary of the public service of thermal energy supply; in the case of condominiums, the user means all the consumers of the condominium;

36. safety/protection area - an area adjacent to the SACET installations and constructions, extended in space, in which the restrictions or prohibitions on construction and operating regime of the land for ensuring the protection and the normal functioning of the energy target, and to avoid endangering persons, properties and the environment, determined by technical norms issued by the competent regulatory authority;

37. the unit area of heating - geographical area belonging to an administrative division, within which a single technical solution for heating can be promoted .

CHAPTER II

Organization and functioning of the public service of thermal energy supply

SECTION 1

Policies and strategies

ARTICLE 6

(1) The policy in the field of public of thermal energy supply is developed by the Ministry of Administration and Interior, in cooperation with the Ministry of Economy and Commerce, and it is a part of the energy politics of the state.

(2) The social protection policy in the field of the supply with thermal energy is developed by the Ministry of Labour, Social Solidarity and Family in cooperation with the Ministry of Administration and Interior, by consulting the representative non-governmental associations in the field.

ARTICLE 7

(1) The Government approves the National strategy on public service of thermal energy supply in centralized system.

(2) The strategy referred to in paragraph (1) is prepared by the Ministry of Administration and Interior in cooperation with the Ministry of Economy and Commerce and the Ministry of Environment and Water Management, by consulting the representative non-governmental associations in the field.

SECTION 2

Powers of local public administration authorities in the field of thermal energy

ARTICLE 8

(1) The establishment, organization, coordination, monitoring and control of the public service of thermal energy supply are obligations of the local public administration authorities.

(2) Ensuring the public service of thermal energy supply, the local public administration authorities mainly have the following tasks:

a) to ensure the continuity of the public service of thermal energy supply to the level of the administrative divisions;

b) to annually develop its program in the field of thermal energy, correlated with its own energy efficiency program and approved by the local council, the county council, or the General Council of Bucharest, or by the community development association, as appropriate;

c) to establish an energy department in the own apparatus, according to the law;

d) to approve, under the law, within 30 days, the proposals on the local price of thermal energy to the thermal energy users, submitted to the operators of the service;

e) to approve, under the law, the local price for the population;

f) to approve the program of development, modernization and counting of SACET, which must contain both sources of funding and completion deadline, based on the data provided by the operators of the service;

g) to provide the conditions for the preparation of studies regarding assessment of the local potential of renewable energy resources, and of feasibility studies regarding the exploitation of this potential;

h) to exert the control of the public service of thermal energy supply, under the law;

i) to establish unitary heating zones, based on the feasibility studies regarding the regional development, approved by the decision of the local council, the county council or the General Council of Bucharest, or by the community development association, as appropriate;

j) to watch the instruction of the service operator of areas of protection and safety of SACET, under the law;

k) to watch the development and approval of the programs of metering at the thermal branch of users connected to SACET.

(3) In order to modernize and develop SACET, in the feasibility studies, the solutions of supply with thermal energy produced by high-efficiency cogeneration or by exploiting local renewable resources shall be analyzed.

ARTICLE 9

The energy department, established in accordance with article 8, paragraph (2), subparagraph c), has the following main tasks:

a) to develop and submit for approval to the local public administration authority the own program of modernization and development of SACET;

b) to identify the unitary areas of heating;

c) to elaborate, in accordance with the framework regulations issued by A.N.R.S.C., and submitt for approval to the local public administration authority the following:

- the regulation of the public service of thermal energy supply;

- the specifications for rendering the public service of thermal energy supply and for the operation of SACET;

- the management delegation contract of public service of thermal energy supply, as appropriate;

d) to watch the achievement of the objectives contained in its own program of modernization and development of SACET;

e) to watch the achievement of the contractual clauses, in the case of delegated management;

f) to regularly communicate the information required by the competent regulatory authorities;

g) to control the development of the activity regarding the thermal energy distribution of costs in condominiums;

h) to provide and submit to the local public administration authority the preliminary data necessary to support and develop local strategies of exploitation of the potential of the renewable energy resources;

i) to propose solutions to locally exploit the potential of renewable energy resources;

j) to develop and pursue the achievement of SACET metering program.

SECTION 3

Management organization

ARTICLE 10

(1) The management of the public service of thermal energy supply through SACET can be organized in the following ways:

a) direct management;

b) delegated management.

(2) The selection of the method of management of the public service of thermal energy supply through SACET is made by decision adopted by local public administration authorities, or by community development associations.

(3) Local public administration authorities can associate with each other in order to establish community development associations, in accordance with the stipulations ofLaw on public utilities services no 51/2006,and may constitute companies with public or mixed capital, in order to manage the public service of thermal energy supply through SACET, under the law.

(4) An authority of the local public administration or an association of community development may be associated with Romanian or foreign legal persons, for the establishment of companies with public or mixed capital, in order to manage the public service of thermal energy supply through SACET, under the law.

SECTION 4

Direct management

ARTICLE 11

(1) In the case of direct management, the local public administration authorities, or the community development associations, as appropriate, directly assume all duties and responsibilities of the organization, management, administration, operation and funding of public service of thermal energy supply through SACET.

(2) Direct management is achieved by the own structures of local public administration authorities, or of the community development associations, established by decisions of county councils, local councils, the General Council of Bucharest or community development associations, as appropriate, defined according to the stipulations of Law no 51/2006.

SECTION 5

Delegated management

ARTICLE 12

(1) In the case of the delegated administration, the local public administration authorities, or the community development associations, as appropriate, transfer, in whole or in part, the rights and obligations with respect to providing public service of thermal energy supply, and to management and operation of SACET to an operator that can be a company with public, private or mixed capital.