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Cross-border exchanges in electricity (from 2011)

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Cross-border exchanges in electricity (from 2011)

Barriers to competition still remain in the internal market in electricity. This Regulation lays down rules providing a framework for cross-border exchanges in electricity in order to alleviate these difficulties.

ACT

Regulation (EC) No 714/2009 of the European Parliament and of the Council of 13 July 2009 on conditions for access to the network for cross-border exchanges in electricity and repealing Regulation (EC) No 1228/2003 (Text with EEA relevance).

SUMMARY

This Regulation aims at laying down rules for cross-border exchanges in electricity with a view to improving competition and harmonisation in the internal market for electricity.

Certification of transmission system operators

National regulatory authorities send the European Commission notification of decisions concerning the certification of a transmission system operator. The Commission then has a period of two months to deliver its opinion to the national regulatory authority. The authority then adopts the final decision concerning the certification of the transmission system operator. This decision and the Commission’s opinion are published.

European Network of Transmission System Operators (ENTSO) for electricity

Creation of the ENTSO for Electricity

The European Network of Transmission System Operators (ENTSO) for electricity is responsible for managing the electricity transmission system and for allowing the trading and supplying of electricity across borders in the Community.

Tasks of the ENTSO concerning network codes

The Commission consults the Agency for the Cooperation of Energy Regulators and the ENTSO for Electricity in order to establish an annual list of the priorities which are to contribute to developing network codes. These codes are developed using a non-binding framework guideline submitted to the Commission by the Agency. The codes include rules and procedures relating in particular to:

  • network security and reliability;
  • data interexchange;
  • technical and operational exchanges;
  • transparency rules;
  • harmonised transmission tariff structures;
  • energy efficiency.

Tasks of the ENTSO for Electricity

The ENTSO for Electricity is responsible for adopting:

  • common network operation tools;
  • a ten-year network development plan;
  • recommendations relating to the coordination of technical cooperation between Community transmission system operators;
  • an annual work programme;
  • an annual report;
  • annual summer and winter generation supply outlooks.

Costs and financing

The costs related to the activities of the ENTSO for electricity are borne by the transmission system operators. They establish regional cooperation within the ENTSO for electricity and publish a regional investment plan every two years, on which investments may be based.

Transmission system operators receive compensation for costs incurred as a result of hosting cross-border flows of electricity on their networks. The compensation is paid by the operators of national transmission systems from which cross-border flows originate. The costs are established on the basis of forecasted costs.

Charges for access to networks are also applied by operators.

Information and congestion management

Transmission system operators put in place information exchange mechanisms to ensure the security of networks in the context of congestion management.

Network congestion problems are addressed with non-discriminatory solutions based on market mechanisms which give economic signals to the market participants and transmission system operators.

New interconnectors may, upon request, be exempted, for a limited period of time, from the general provisions governing congestion management on condition that:

  • their installation increases competition in electricity supply;
  • the level of risk necessitates the exemption;
  • the interconnection must be owned by a natural or legal person;
  • charges are levied on users of the interconnection;
  • the exemption must not be to the detriment of competition or the effective functioning of the internal market, or the efficient functioning of the of the regulated system to which the interconnector is linked.

Regulation (EU) No 347/2013 lays down guidelines for the development and interoperability of priority corridors and areas of trans-European energy infrastructure.

It provides for:

  • a Union list of projects of common interest: each of twelve Regional Groups adopts a regional list of projects of common interest. The membership of each Group is based on each priority corridor and area and their respective geographical coverage. On the basis of the regional lists, the Commission adopts the Union list of projects of common interest, the first of which was adopted by 30 September 2013. A new Union list should be established every two years.
  • criteria for projects of common interest: a project must comply with the following general criteria: (i) it is necessary for at least one of the energy infrastructure priority corridors and areas; (ii) its potential overall benefits, including in the longer term; (iii) involves at least two Member States by directly crossing the border of two or more Member States.
  • electricity transmission and storage projects falling under the energy infrastructure categories, must contribute significantly to at least one of the following specific criteria: (i) market integration by reducing energy infrastructure bottlenecks; (ii) sustainability, inter alia through the integration of renewable energy into the grid; (iii) security of supply.

Where a project of common interest encounters significant implementation difficulties, the Commission may designate, in agreement with the Member States concerned, a European coordinator for a period of up to one year renewable twice. The coordinator shall promote cross-border dialogue between the project promoters and all concerned stakeholders.

Granting permits: Regulation 347/2013 also helps project implementation by streamlining, coordinating more closely, and accelerating permit granting processes.

REFERENCES

Act

Entry into force

Deadline for transposition in the Member States

Official Journal

Regulation (EC) No 714/2009

3.9.2009

-

OJ L211 of 14.8.2009

Amending acts

Entry into force

Deadline for transposition in the Member States

Official Journal

Regulation (EU) No 347/2013

15.5.2013

-

OJ L115 of 25.4.2013

Regulation (EU) No 543/2013

5.7.2013 and some provisions on 5.1.2015

-

OJ L 163 of 15.6.2013

RELATED ACT

Commission Regulation (EU) No 838/2010 of 23 September 2010 on laying down guidelines relating to the inter-transmission system operator compensation mechanism and a common regulatory approach to transmission charging (Text with EEA relevance).

This Regulation establishes an inter-transmission system operator compensation mechanism (ITC mechanism) for the costs caused by hosting cross-border flows of electricity. The transmission system operators contribute to the ITC fund in proportion to the absolute value of net flows onto and from their national transmission system.

Furthermore, this Regulation lays down the annual average transmission charges paid by electricity producers.

Last updated: 08.03.2014

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