• الجمهورية الجزائرية الديمقراطية الشعبية

    République Algérienne Démocratique et Populaire

Operator Area

Electricity and Gas Distribution

The activity of electricity and gas distribution is subject to the concession regime and is governed by Law No. 02-01 of 22 Dhou El Kaada 1422 (corresponding to February 5, 2002) related to electricity and the distribution of gas through pipelines, along with its implementing regulations.

The owners of electricity and gas distribution networks serving the national territory, existing at the time of the promulgation of Law 02-01, are the holders of the exploitation concessions for these networks.

The distribution concessions for electricity and gas are held by the Algerian Electricity and Gas Distribution Company, Sonelgaz Distribution (www.sonelgaz-distribution.dz).

Rights and Obligations

The specifications regarding the rights and obligations of the electricity and gas distribution concessionaire are annexed to Executive Decree No. 08-114 of April 9, 2008.

Rights of the Concessionaire

Under the concession, the State guarantees the concessionaire the exclusive right to ensure the distribution of electrical and/or gas energy within the concession area and, for this purpose, to establish the necessary infrastructure.

Subject to the payment of fees for the occupation of public land, the concessionaire has the exclusive right to extend, reinforce, renew, maintain, or repair, within the limits of the concession area, whether above or below public roads and their dependencies, all the necessary infrastructure for the public distribution of electricity and/or gas.

The concessionaire collects from clients a fee intended to remunerate the distribution service of electricity and/or gas as well as the other obligations placed upon them. This remuneration is determined by the Electricity and Gas Regulatory Commission (CREG) based on the methodology established by the applicable regulations. It consists of:

      • Remuneration of the concessionaire for its activities in the distribution of electricity and/or gas.
      • Remuneration of the concessionaire for its activities in commercialization.

Obligations of the Concessionaire

Collect fees on behalf of the State: The concessionaire must collect all fees or taxes imposed on the client, as per the relevant legislation.

Contributions for tariff equalization: The concessionaire collects and remits contributions included in the electricity and gas tariffs in accordance with the current legislation. These contributions aim to ensure tariff equalization between different concessions and to finance the permanent costs of the electrical or gas system and diversification costs.

Infrastructure installation: The concessionaire cannot oppose the establishment of infrastructure either for the electricity or gas transmission network, for neighboring distribution systems, or for clients’ own needs or electricity producers.

Regulatory oversight: The concessionaire is subject to supervision to ensure proper execution of the concession service, carried out by the Electricity and Gas Regulatory Commission (CREG).

Connection of renewable energy and cogeneration: The concessionaire is required to connect renewable energy and/or cogeneration electricity production facilities, under the special regime, which hold an operating authorization from the Electricity and Gas Regulatory Commission.

Responsibility for the concession service: The concessionaire is responsible for the operation of the concession service and manages it in accordance with the legislation and regulations in force. The responsibility for all infrastructure related to the service and its operation lies with the concessionaire.

Diversification costs: Any additional costs incurred from this connection are considered diversification costs.

Service continuity and quality: The concessionaire is obligated, for the entire duration of the concession, to ensure the concession service is provided with the best continuity and quality across the entire concession area.

Obligation to purchase electricity under the special regime: The concessionaire is obligated to purchase all electricity produced under the special regime.

Environmental and urban planning compliance: The concessionaire must conduct all of its activities in compliance with environmental protection rules and urban planning regulations applicable within the concession area.

Obligation to purchase electricity in tenders: In the event of a tender launched by the Electricity and Gas Regulatory Commission for the construction of new electricity production facilities, the concessionaire is obligated to purchase all or part of the electricity produced, under the conditions set by the Regulatory Commission, in agreement with the selected producer.

Remuneration

The remuneration for the distribution activity, both for electricity and gas, is set by the Electricity and Gas Regulatory Commission (CREG) based on a methodology and parameters defined in Executive Decree No. 05-182.

 

It takes into account the costs of investment, operation, and maintenance of installations, the characteristics of the served distribution zones, other necessary costs for conducting the activity, and a fair return on the invested capital, similar to other activities, while considering development costs.

The remuneration formula includes incentives for reducing costs and improving the quality of supply.

Distribution Concessions

The terms of granting and withdrawal of electricity and gas distribution concessions are defined in Executive Decree No. 08-114 of April 9, 2008.

Granting a concession

The concession is granted by executive decree upon the proposal of the Minister in charge of energy, after the opinion of the CREG.

The granting of distribution concessions is done through a public tender process launched and processed by the CREG. The concession is non-transferable.

Withdrawal of a concession

The concessionaire fails to comply with the terms of the contract as defined in Executive Decree No. 08-114 of April 9, 2008, and continues to neglect its obligations after being notified of a formal warning by the Minister in charge of energy.

The concessionaire fails to comply with the applicable laws and regulations.

The concessionaire is subject to a court ruling that prohibits it from continuing its activities or is subject to dissolution or judicial liquidation procedures that prevent it from fulfilling its commitments or from entering into new ones.

Public Service

The public service aims to ensure the supply of electricity and gas across the entire national territory under the best conditions of security, quality, price, and in compliance with technical and environmental regulations.

The mission of public service aims to:

  • Provide energy to non-eligible customers under the best conditions of fairness, continuity, and price equalization.
  • Ensure, in the framework of equal treatment, the connection and access of distributors, eligible customers, and electricity producers to the electricity transmission networks.
  • Satisfy the energy needs of specific categories of citizens and disadvantaged regions to ensure better social cohesion and contribute to greater solidarity.
  • Provide energy assistance upon request, within available means, to producers or eligible customers connected to the networks.
  • Ensure the supply of energy to any eligible customer if they cannot find a supplier under acceptable economic or technical conditions.

Any public service obligation entitles compensation from the State, following the advice of the CREG, particularly in the following cases:

  • Additional costs arising from energy supply and purchase contracts imposed by the State.
  • Contributions for specific customers.
  • Additional costs of production and distribution activities in particular regions.
  • Constraints identified as such by the regulatory commission.

Associated Regulation

Laws

Law 02-01 of 22 Dhou El Kaada 1422 (corresponding to February 5, 2002) on Electricity and Gas Distribution through Pipelines

Law 02-01 of 22 Dhou El Kaada 1422 (corresponding to February 5, 2002) governs activities related to electricity and gas distribution through pipelines in Algeria. It establishes the legal framework for the production, transmission, distribution, and commercialization of electricity and gas. The law aims to organize and regulate these sectors to ensure a reliable and high-quality supply while promoting competition and protecting consumer rights. It also sets out the conditions for network connections, the obligations of operators, and the regulatory mechanisms enforced by the competent authorities.

Decrees

Executive Decree No. 12-150 of 5 Joumada El Oula 1433 (corresponding to March 28, 2012) amending Executive Decree No. 10-138 of 28 Joumada El Oula 1431 (corresponding to May 13, 2010) setting the technical rules for the design, operation, and maintenance of electricity and gas distribution networks

Executive Decree No. 12-150 of 5 Joumada El Oula 1433 (March 28, 2012) modifies Executive Decree No. 10-138 of 28 Joumada El Oula 1431 (May 13, 2010). The initial decree establishes the technical rules for the design, operation, and maintenance of electricity and gas distribution networks in Algeria.

Executive Decree No. 10-138 of 28 Jumada Al-Awwal 1431 (corresponding to May 13, 2010) establishing the technical rules for the design, operation, and maintenance of electricity and gas distribution networks

Executive Decree No. 10-138, promulgated on 28 Jumada Al-Awwal 1431 (corresponding to May 13, 2010), establishes the technical rules for the design, operation, and maintenance of electricity and gas distribution networks in Algeria. This decree aims to ensure the safety, reliability, and efficiency of distribution networks while protecting property and individuals.

Executive Decree No. 08-394 of 16 Dhou El Hidja 1429 (December 14, 2008), establishing tools and methodology for developing the indicative supply program for the national gas market

Executive Decree No. 08-394 of 16 Dhou El Hidja 1429 (December 14, 2008) sets out the tools and methodology for developing the indicative supply program for the national gas market. This decree establishes a regulatory framework for the planning and management of gas resources to ensure adequate supply to the national market. It defines the criteria and mechanisms for forecasting future gas demand and the means to respond effectively.

Executive Decree No. 08-114 of 3 Rabie Ethani 1429 (April 9, 2008), establishing the procedures for the attribution and withdrawal of electricity and gas distribution concessions and the terms and conditions of the concessionaire’s rights and obligations

Executive Decree No. 08-114 of April 9, 2008, establishes the procedures for the attribution and withdrawal of electricity and gas distribution concessions in Algeria. This regulatory text outlines the procedures for granting concessions and the conditions for their withdrawal. It also includes the terms and conditions detailing the rights and obligations of concessionaires to ensure effective and reliable distribution of electricity and gas to consumers.

Executive Decree No. 06-432 of 5 Dhou El Kaada 1427 (November 26, 2006), establishing the terms and conditions of the rights and obligations of the gas transmission network operator

This decree is essential for regulating the management of the gas transmission network in Algeria. It aims to ensure energy security, equitable access to infrastructure, and transparency in operations and costs. The role of the CREG is central in supervising and controlling the activities of the operator to ensure compliance with the regulations in force.

Orders

Order of Rajab 30, 1442, corresponding to March 14, 2021, setting the specifications and technical procedures for the operation of gas distribution facilities

The Order of Rajab 30, 1442, corresponding to March 14, 2021, establishes the specifications and technical procedures for the operation of gas distribution facilities. Issued by the Minister of Energy and Mines, this order sets out the technical standards and guidelines to be followed in the operation of gas distribution infrastructure. Its goal is to ensure the safety, reliability, and efficiency of gas distribution operations. These specifications and procedures provide a clear framework for companies in the gas sector, ensuring compliance with standards and improving the management of distribution networks.

Order of Rajab 30, 1442, corresponding to March 14, 2021, setting the specifications and technical procedures for the maintenance of gas distribution facilities

The Order of Rajab 30, 1442, corresponding to March 14, 2021, establishes the specifications and technical procedures for the maintenance of gas distribution facilities. Issued by the Minister of Energy and Mines, this order sets the standards and guidelines to be followed to ensure the effective maintenance of gas distribution infrastructure.

Order of Rajab 30, 1442, corresponding to March 14, 2021, setting the specifications and technical procedures for the design and construction of gas distribution facilities

The Order of Rajab 30, 1442, corresponding to March 14, 2021, establishes the specifications and technical procedures for the design and construction of gas distribution facilities. Issued by the Minister of Energy and Mines, this order sets out the technical standards and guidelines to be followed in the design and construction of gas distribution infrastructure.

Order of Sha’ban 27, 1442, corresponding to April 10, 2021, setting the specifications and technical procedures for the design and construction of electricity distribution facilities

The Order of Sha’ban 27, 1442, corresponding to April 10, 2021, establishes the specifications and technical procedures for the design and construction of electricity distribution facilities. Issued by the Minister of Energy and Mines, this order sets the standards and technical guidelines to be followed during the design and construction of electricity distribution infrastructure.

Order of 27 Chaâbane 1442 (April 10, 2021), setting the specifications and technical procedures for the operation of electricity distribution facilities

This arrêté sets the specifications and technical procedures for the operation of electricity distribution facilities. It defines the necessary standards to ensure effective and safe operation of electricity distribution infrastructure.

Order of 27 Chaâbane 1442 (April 10, 2021), setting the specifications and technical procedures for the maintenance of electricity distribution facilities

This arrêté sets the specifications and technical procedures for the maintenance of electricity distribution facilities. It aims to ensure the regular maintenance and reliability of electrical infrastructure.

Order of Rabi’ al-Thani 4, 1438, corresponding to January 3, 2017, setting the specifications and technical procedures for the design and construction of electricity distribution facilities

This order, dated Rabi’ al-Thani 4, 1438 (corresponding to January 3, 2017), defines the specifications and technical procedures to be followed for the design and construction of electricity distribution facilities.

Order of Jumada Al-Awwal 27, 1436, corresponding to March 18, 2015, establishing the technical specifications and procedures for the operation of electricity distribution infrastructures

This order, dated Jumada Al-Awwal 27, 1436 (corresponding to March 18, 2015), establishes the technical specifications and procedures for the operation of electricity distribution infrastructures. Its objective is to define the standards and technical procedures to be followed to ensure the efficient and safe operation of electricity distribution facilities.

Order of Jumada Al-Awwal 20, 1436, corresponding to March 11, 2015, setting the technical specifications and procedures for the design and construction of gas distribution infrastructures

This order, dated Jumada Al-Awwal 20, 1436 (corresponding to March 11, 2015), establishes the technical specifications and procedures for the design and construction of gas distribution infrastructures. Its objective is to ensure the quality, safety, and efficiency of gas distribution facilities.

Order of Jumada Al-Awwal 20, 1436, corresponding to March 11, 2015, setting the technical specifications and procedures for the operation of gas distribution infrastructures

This order, dated Jumada Al-Awwal 20, 1436 (corresponding to March 11, 2015), establishes the technical specifications and procedures for the operation of gas distribution infrastructures. Its objective is to ensure the proper functioning and safety of gas distribution facilities.

Order of Jumada Al-Awwal 20, 1436, corresponding to March 11, 2015, setting the technical specifications and procedures for the maintenance of gas distribution infrastructures

This order, dated Jumada Al-Awwal 20, 1436 (corresponding to March 11, 2015), establishes the technical specifications and procedures for the maintenance of gas distribution infrastructures. It aims to ensure the safety and reliability of the gas network.

Order of Jumada Al-Awwal 20, 1436, corresponding to March 11, 2015, setting the technical specifications and procedures for the maintenance of gas distribution infrastructures

This order, dated Jumada Al-Awwal 20, 1436 (corresponding to March 11, 2015), establishes the technical