The regulatory framework is a determination of the planned eligible costs and resources to cover the eligible costs of the natural gas distribution system operator (gas DSO). The regulatory framework is established by the gas DSO in accordance with Legal Act on the methodology for determining the regulatory framework of the natural gas system operator (unofficial translation).

The eligible costs of the distribution system operator consist of:

• controlled operation and maintenance costs
• uncontrolled operating and maintenance costs
• depreciation costs
• the regulated return on assets

Resources to cover eligible costs are the network charges and other revenues. In determining the resources to cover eligible costs, the derogations from the regulatory framework of previous years resulted as a surplus or deficit of the network charges will be taken into account.

By using the method of regulated annual income and regulated network charges the gas DSO determines the regulatory framework in such a way that with the planned annual income for the regulatory period, the surplus from network charges and the planned deficit from network charges limited to the planned depreciation costs ensures covering the eligible costs for the regulatory period and the corresponding deficit of the preceding years.

The gas DSO sends the Energy Agency the request for consent to the regulatory framework, the network charge tariffs, and tariff rates for other services for a given regulatory period. In the approval procedure, the Energy Agency evaluates the compliance of the proposed eligible costs, resources for their covering, and network charges submitted in the request with the applicable methodologies.

The current regulatory period for the gas DSOs lasts from 1 January 2019 to 31 December 2021.