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4 Analysis, Findings and Results
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4.5 Legal Aspects and Pre-Conditions
The legal work initially comprised of an analysis and comparison of the legal systems applicable within the UCTE and the IPS/UPS (Legal Questionnaire). It appeared from the Legal Questionnaire that there are some quite substantial differences between the two legal systems regarding:
- Harmonisation of rules and regulations;
- Binding nature of rules and regulations;
- Organisation of markets.
A tool was developed to take these differences into account, namely, the Legal Checklist. This identifies issues that can only be solved by contractual means and those that cannot be solved by purely contractual means, such as, those requiring regulatory or political actions. The Legal Checklist provides a useful list of “To Do’s” should the synchronous interconnection actually be realized.
In reality, the so-called “multi layer contractual framework” addresses the legal needs of the study. The principle structure of the legal framework is shown in the Figure. The proposed contractual framework is “multi layered” as it offers several contractual “layers”, namely:
- An "Interzonal Agreement" (IZA) aimed at addressing the needs on a global level for the whole synchronous interconnection; and
- A series of “Bi- and/or Multilateral Agreement” (BLA/MLA) designed to address the legal needs of the interface (e.g. at a local level).
Both types of agreements contain standard clauses that can be found in most contractual relationships. They each cover the standard rules for synchronous interconnections. The BLA/MLA focuses on the interface, whereas the IZA spells out the general principles applicable to the whole synchronous interconnection. The BLA/MLA, while providing rules for the interface, implements the general principles in the IZA. The IZA also contains organisational rules which aim at adapting over a period of time, the contractual structure for developing the synchronous interconnection.
The multi layer contractual framework is headed by the Liability Clause that aims at preventing and managing risks/incidents. The Liability Clause contains, among other things:
- A general limitation of damage;
- The creation of a judiciary body (the “Liability Committee”) whose function is to decide upon both technical and legal matters arising from cases of incidents;
- A procedure for submission exchanges.
Finally, the Case Study validates the above mentioned legal/contractual framework. It signifies that the framework is coherent and fit to address all types of situations, ranging from a simple incident to a worst-case scenario (e.g. a major incident spreading over the entire synchronous interconnection). Synchronous interconnections imply more complex legal provisions than an asynchronous interconnection, due to the synchronism requirement for the initial method of interconnection. However, taking into account the factors set down in the Legal Checklist, it is evident that the aforementioned framework properly addresses the legal needs of the contemplated synchronous coupling.
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