Valve Study Agreement
Regional public and private parties (such as local and provincial authorities, port authorities and network operators) can enter into an agreement and the associated financial obligations with Hynetwork for the development and implementation of a connection set-up for future hydrogen developments in the region. This is called a Valve Study Agreement (VSA).
Agreement between Hynetwork and one other party
A VSA is based on the Connection Study Agreement (CSA) and can be requested by third parties. This VSA covers Hynetwork’s studies in relation to the connection set-up, and constitutes our agreement with you to work towards an agreement for implementation of the connection set-up, known as a Valve Investment Agreement (VIA). We refer to the contract party with whom the VSA is concluded as the ‘Valve Party’. Implementation of a connection set-up is the end of the route for the Valve Party. If one market party wants to work towards an actual connection, the regular process for becoming a ‘Connected Party’ (CSA-IA-CA) remains in full effect.
How much does a VSA cost?
By entering into a VSA, the contract party commits to a €150,000 guarantee. This does not involve a deposit. Hynetwork will then launch the study.
After formal delivery of the study results, the customer will have to choose one of the following options within a period of six months:
- Proceed with an investment agreement. This will include the actual costs incurred to perform the study. They may end up higher or lower than the €150,000 guarantee provided earlier. Any obligations from the VSA will then lapse.
- Decide to stop. Hynetwork will then be entitled to claim a maximum of €150,000, even if the study cost more than €150,000. Hynetwork will position itself as a prudently operating party.
What are the investment costs for a VIA?
The investment costs for implementing a connection set-up are determined for each situation based on the study results. Connection set-ups often have the same components, but the actual solution used may differ per location, so no standard price is available.
| CSA | VSA |
|---|---|
| Study/design with the end goal of creating a connecting pipe for an individual future connection, including an on-site hydrogen receiving station | Study/design with the end goal of creating a connection set-up (split tee) for future access by a local area with potential connected parties |
| The actual implementation is performed under an Investment Agreement (IA) | The actual implementation is performed under a Valve Investment Agreement (VIA) |
| One contract party: the future connected party | One contract party: may also be a third party acting on behalf of potential connected parties |
| Development depends on location of the entity and indicated capacity | Development depends on desired location and (cumulative) capacity of split tee |
| Possibility to create only a split tee first remains open | Exact location and dimensions to be determined during the study |
Frequently asked questions
Does this connection set-up involve a “split tee”?
The term “split tee” is used informally to refer to a “connection set-up”. Both terms basically mean the same thing: the minimum infrastructure needed to prevent a future need for tapping.
Who pays for the connection set-up?
The Valve Party pays for the connection set-up under the articles in the existing Valve Investment Agreement. It is up to the contract party to make arrangements for mutual settlement with any associated parties.
Why do you ask for a €150,000 guarantee for the VSA?
As well as designing the connection set-up, studies need to be performed in relation to the site and dimensions. On balance, € 150,000 is an appropriate amount for a customer guarantee.
How do you determine the dimensions of the set-up?
On the basis of capacity details provided by the contract party. Annex A of the VSA has space for details such as the required site, H2 capacity and entry/exit. The contract party is responsible for ensuring the correct details are provided.
What about the OPEX costs?
The OPEX costs are settled through a Valve Agreement (VA).
Will the VIA/IA routes be separated? So there’ll be two separate routes, each for a different result?
Yes. The Valve Party can have a connection set-up implemented through a VIA. For individual parties who want an actual connection pipeline implemented, the current route from a CSA remains applicable. Also see the image entitled “How to become a customer?”.
Is a connection set-up the same as a system interface?
No, a connection set-up is the minimum infrastructure needed to prevent the need for tapping later on.
Are the any credit rating requirements for taking out the VSA?
Yes, before signing the VSA the party’s credit rating will be assessed as certainty for the customer guarantee.
What is the deadline for preparatory connection set-up (split tee) requests in my region in relation to ongoing project procedures?
The project procedures have now started in all regions. Whether your connection set-up request can still be included in the procedure depends, amongst other things, on whether the connection scheme was already part of the draft NRD, based on market interest and local circumstances, such as the vicinity of a Natura2000 area, the precise configuration of the split tee and the situation in terms of private law. This will have to be assessed in the CSA/VIA process for each individual request. Please contact us for this; we will be happy to help.
When establishing the Memorandum on Scope, the scope is generally frozen for the studies within the context of the MIA, which includes the connection set-ups. For connection diagrams that have already been drawn up, this is the most realistic deadline. For new connection diagrams, it is advisable to submit the request as soon as the Notice of Intention and Proposal for Participation have been published, so that the desired connection diagram can still be included in the draft NRD. Check the regional pages for the latest news regarding the various regions.
The following also applies:
- including a connection set-up in parallel to the construction of the national hydrogen network is only possible if this does not pose any risk to fulfilling the schedule as set out in the roll-out plan;
- attaching a connection pipe remains possible after construction of a new hydrogen pipeline or conversion of an existing natural gas pipeline.
What if the project procedure is at such an advanced stage that a connection set-up can no longer be included?
In that case, it will be determined whether a separate permit process can be followed in addition to the project procedure that is already ongoing or completed, to maximise the chances of being able to construct it at the same time as the hydrogen network’s main pipeline.
Who is responsible for starting up a parallel procedure for an all-in-one permit for physical aspects if necessary?
A parallel procedure relates to a request for a separate permit in addition to the ongoing or completed project procedure. If a VSA is concluded, Hynetwork will initiate this permit procedure.
Which party eventually issues an all-in-one permit for physical aspects for a connection set-up?
The municipality in question issues the permit for connection set-ups.