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Document 52020PC0706
Proposal for a COUNCIL DECISION on the position to be adopted, on behalf of the European Union, within the EEA Joint Committee concerning an amendment to Annex IV (Energy) to the EEA Agreement [32016R1719 - Guideline on forward capacity allocation "FCA"]
Proposal for a COUNCIL DECISION on the position to be adopted, on behalf of the European Union, within the EEA Joint Committee concerning an amendment to Annex IV (Energy) to the EEA Agreement [32016R1719 - Guideline on forward capacity allocation "FCA"]
Proposal for a COUNCIL DECISION on the position to be adopted, on behalf of the European Union, within the EEA Joint Committee concerning an amendment to Annex IV (Energy) to the EEA Agreement [32016R1719 - Guideline on forward capacity allocation "FCA"]
COM/2020/706 final
EUROPEAN COMMISSION
Brussels, 12.11.2020
COM(2020) 706 final
2020/0316(NLE)
Proposal for a
COUNCIL DECISION
on the position to be adopted, on behalf of the European Union, within the EEA Joint Committee concerning an amendment to Annex IV (Energy) to the EEA Agreement
[32016R1719 - Guideline on forward capacity allocation "FCA"]
(Text with EEA relevance)
EXPLANATORY MEMORANDUM
1.CONTEXT OF THE PROPOSAL
•Reasons for and objectives of the proposal
The draft Decision of the EEA Joint Committee (annexed to the proposed Council Decision) aims to amend Annex IV (Energy) to the EEA Agreement in order to incorporate Commission Regulation (EU) 2016/1719 of 26 September 2016 establishing a guideline on forward capacity allocation 1 into the EEA Agreement.
The electricity network codes and guidelines, as established with a basis in the 3rd Energy Package, set out technical rules to facilitate trade within the EU internal electricity market. A fully functioning and interconnected internal energy market is crucial to the objectives of security of supply, increasing competitiveness and ensuring that consumers can purchase energy at affordable prices. Significant electricity interconnections have been established between Norway, as an EEA EFTA State, and EU Member States. It is therefore imperative that the technical rules applicable to trade within the EU internal electricity market are extended to the EEA to ensure legal homogeneity as a basis for trade in electricity.
Commission Regulation (EU) 2016/1719 lays down detailed rules on the allocation of capacity across bidding zones in forward markets. It establishes a common methodology to determine long-term capacities across bidding zones and a single platform at European level to offer rights for the transmission of electricity, the possibility to return such rights and to transfer them between market participants. It applies to all transmission system operators, except for those on islands which are not connected to another system.
The adaptations appearing in the draft of the annexed Decision of the EEA Joint Committee go beyond what can be considered mere technical adaptations in the sense of the Council Regulation No 2894/94. The Union position shall therefore be established by the Council.
•Consistency with existing policy provisions in the policy area
The annexed draft EEA Joint Committee Decision extends the already existing EU policy to the EEA EFTA States (Norway, Iceland and Liechtenstein).
•Consistency with other Union policies
The extension of the EU acquis to the EEA EFTA States, through its incorporation into the EEA Agreement is conducted in conformity with the objectives and principles of that Agreement, aiming at establishing a dynamic and homogeneous European Economic Area, based on common rules and equal conditions of competition.
2.LEGAL BASIS, SUBSIDIARITY AND PROPORTIONALITY
•Legal basis
The legislation to be incorporated into the EEA Agreement is based on Article 194 of the Treaty on the Functioning of the European Union.
Article 1(3) of Council Regulation (EC) No 2894/94 2 concerning arrangements for implementing the EEA Agreement provides that the Council establishes the position to be adopted on the Union’s behalf on such Decisions, on a proposal from the Commission.
•Subsidiarity (for non-exclusive competence)
The proposal complies with the subsidiarity principle for the following reason:
The objective of this proposal, namely to ensure the homogeneity of the Internal Market, cannot be sufficiently achieved by the Member States and can therefore, by reason of the effects, be better achieved at Union level.
•Proportionality
In accordance with the principle of proportionality, this proposal does not go beyond what is necessary in order to achieve its objective.
•Choice of the instrument
In conformity with Article 98 of the EEA Agreement, the chosen instrument is the EEA Joint Committee decision. The EEA Joint Committee shall ensure the effective implementation and operation of the EEA Agreement. To this end, it shall take decisions in the cases provided for in the EEA Agreement.
3.RESULTS OF EX-POST EVALUATIONS, STAKEHOLDER CONSULTATIONS AND IMPACT ASSESSMENTS
•Ex-post evaluations/fitness checks of existing legislation
Not applicable.
4.BUDGETARY IMPLICATIONS
There are no budgetary implications expected as a result of incorporation of the above mentioned Regulation into the EEA Agreement.
5.OTHER ELEMENTS
•Detailed explanation of the specific provisions of the proposal
Adaptation (a) – non applicability to Iceland and Lichtenstein
As the transmission system of Iceland is not connected with other transmission systems, therefore, Commission Regulation (EU) 2016/1719 should not apply to Iceland.
Commission Regulation (EU) 2016/1719 should not apply to Liechtenstein, as due to its small size and the limited number of electricity customers, Liechtenstein does not have an own transmission electricity network.
Adaptation (b) and recital (6) – sensitive information about the electricity system
In Commission Regulation (EU) 2016/1719 there are provisions setting out obligations to provide information to the European Network of Transmission System Operators for Electricity (ENTSO-E) and Agency for the Cooperation of Energy Regulators (ACER). Adaptation (b) makes it possible that respective Transmission System Operators (“TSOs”) and Regulators exchange such information and protect it.
Adaptation (c) and recital (7) – reference to the participation rights of the Norwegian TSO, Nominated Electricity Market Operator (NEMO) and National Regulatory Authority (NRA) in the development and approval of terms, conditions and methodologies
The adaptation and the recital referred to above adapt relevant provisions of Article 4 of Commission Regulation (EU) 2016/1719 concerning participation rights of relevant entities in the development and approval of terms, conditions and methodologies to include Norway.
2020/0316 (NLE)
Proposal for a
COUNCIL DECISION
on the position to be adopted, on behalf of the European Union, within the EEA Joint Committee concerning an amendment to Annex IV (Energy) to the EEA Agreement
[32016R1719 - Guideline on forward capacity allocation "FCA"]
(Text with EEA relevance)
THE COUNCIL OF THE EUROPEAN UNION,
Having regard to the Treaty on the Functioning of the European Union, and in particular Article 194 in conjunction with Article 218(9) thereof,
Having regard to Council Regulation (EC) No 2894/94 of 28 November 1994 concerning arrangements for implementing the Agreement on the European Economic Area 3 , and in particular Article 1(3) thereof,
Having regard to the proposal from the European Commission,
Whereas:
(1)The Agreement on the European Economic Area 4 ('the EEA Agreement') entered into force on 1 January 1994.
(2)Pursuant to Article 98 of the EEA Agreement, the EEA Joint Committee may decide to amend, inter alia, Annex IV to the EEA Agreement.
(3)Commission Regulation (EU) 2016/1719 of 26 September 2016 establishing a guideline on forward capacity allocation 5 is to be incorporated into the EEA Agreement.
(4)Annex IV to the EEA Agreement should therefore be amended accordingly.
(5)The position of the Union within the EEA Joint Committee should therefore be based on the attached draft decision,
HAS ADOPTED THIS DECISION:
Article 1
The position to be adopted, on behalf of the Union, within the EEA Joint Committee on the proposed amendment to Annex IV (Energy) to the EEA Agreement, shall be based on the draft decisions of the EEA Joint Committee attached to this Decision.
Article 2
This Decision shall enter into force on the date of its adoption.
Done at Brussels,
For the Council
The President
EUROPEAN COMMISSION
Brussels, 12.11.2020
COM(2020) 706 final
ANNEX
to the
Proposal for a Council Decision
on the position to be adopted, on behalf of the European Union, within the EEA Joint Committee concerning an amendment to Annex IV (Energy) to the EEA Agreement
[32016R1719 - Guideline on forward capacity allocation "FCA"]
ANNEX
DECISION OF THE EEA JOINT COMMITTEE
No […]
of […]
amending Annex IV (Energy) to the EEA Agreement
THE EEA JOINT COMMITTEE,
Having regard to the Agreement on the European Economic Area (“the EEA Agreement”), and in particular Article 98 thereof,
Whereas:
(1)Commission Regulation (EU) 2016/1719 of 26 September 2016 establishing a guideline on forward capacity allocation 1 is to be incorporated in the EEA Agreement.
(2)Commission Regulation (EU) 2016/1719 does not apply to transmission systems on islands which are not connected to other transmission systems via interconnections.
(3)As the transmission system of Iceland is not connected with another transmission system, Commission Regulation (EU) 2016/1719 should not apply to Iceland.
(4)Due to its small size and the limited number of electricity customers, Liechtenstein does not have an own transmission electricity network. Commission Regulation (EU) 2016/1719 should therefore not apply to Liechtenstein.
(5)References to Transmission System Operators (“TSOs”), Nominated Electricity Market Operators (“NEMOs”), regulatory authorities and stakeholders should be understood to include the TSO, NEMOs, regulatory authorities and stakeholders representing Norway.
(6)When jointly developing terms, conditions and methods pursuant to Commission Regulation (EU) No 2016/1719, it is essential that all necessary information is submitted without delay. Close cooperation between TSOs and regulators should ensure that sensitive information, such as detailed information about electrical substations, exact location of underground transmission, information about control systems and detailed vulnerability analyses that can be used for sabotage, is effectively protected in the process of developing terms, conditions or methodologies. To ensure the effective implementation of this Regulation, the same level of cooperation regarding information exchange and protection of sensitive information should be established in the cooperation with Norway.
(7)Input from all main stakeholders in the development of regional or EEA-wide terms, conditions and methodologies, that may become binding through regulatory approval, is crucial for an effective regulatory cross-border framework. The TSOs and other stakeholders should therefore participate in the processes for the development of proposals for terms, conditions and methodologies as set out in the various provisions in this Regulation. The Norwegian TSO and NEMOs should notably participate in the stakeholder decision-making in a similar manner as TSOs and NEMOs representing an EU Member State.
(8)For regional or Union-wide proposals, where the approval of proposals from TSOs requires a decision by more than one regulatory authority, regulatory authorities should consult and closely cooperate in order to reach agreement before the regulatory authorities adopt a decision. The Norwegian regulatory authority should be involved in this cooperation.
(9)As this Regulation has been adopted on the basis of 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 2 , the adaptation texts elaborated and adopted under Decision of the EEA Joint Committee No 93/2017 of 5 May 2017 3 for the implementation of Regulation 714/2009, in particular the provisions in Art. 1 (1) and (5) thereof, which provide for adaptations concerning the role of the Agency for the Cooperation of Energy Regulators in the EEA context, are relevant for the application of this Regulation in the EEA, notably for Article 4 (8) and (10).
(10)Annex IV to the EEA Agreement should therefore be amended accordingly,
HAS ADOPTED THIS DECISION:
Article 1
The following is inserted after point 49 (Commission Regulation (EU) 2015/1222) of Annex IV to the EEA Agreement:
‘50. 32016 R 1719: Commission Regulation (EU) 2016/1719 of 26 September 2016 establishing a guideline on forward capacity allocation (OJ L 259, 27.9.2016, p. 42).
The provisions of the Regulation shall, for the purposes of this Agreement, be read with the following adaptations:
(a)The Regulation shall not apply to Iceland and Liechtenstein.
(b)The following shall be added to Article 7:
“Agreements between TSOs and / or Regulators may ensure that confidential or sensitive information is effectively protected and help guaranteeing that all information which is necessary to develop the common terms, conditions and methods is submitted without delay”.
(c)In Article 4:
(i) The references to “the population of the Union” in Article 4(2)(b), to “the population of the concerned region” and to “the population of the participating Member States” in Article 4(3)(b) shall be understood as including the population of Norway when considering whether the relevant population threshold for attaining qualified majority is attained.
(ii) The references to “regions composed of more than five Member States” and to “regions composed of five Member States or less” in Article 4(3) shall be read as “regions composed of more than four Union Member States and Norway” or as “regions composed of four Union Member States and Norway or less”.
Article 2
The text of Regulation (EU) 2016/1719 in the Icelandic and Norwegian languages, to be published in the EEA Supplement to the Official Journal of the European Union, shall be authentic.
Article 3
This Decision shall enter into force on […], or on the day following the last notification to the EEA Joint Committee under Article 103(1) of the EEA Agreement 4*, whichever is the later.
Article 4
This Decision shall be published in the EEA Section of, and in the EEA Supplement to, the Official Journal of the European Union.
Done at Brussels, […].
For the EEA Joint Committee
The President
[…]
The Secretaries
To the EEA Joint Committee
[…]
