text: OJ L 152, 3.6.2022, p. 45 2 OJ L 158, 16.6.2019, p.22

text: Opinion No 09/2023

text: In this Opinion, the term “proposed PCIs/PMIs” indicates projects, which are included in the document of the draft regional PCI/PMI lists submitted to ACER in sections “Hydrogen and electrolyser projects” of which only hydrogen project have been considered for this opinion, and the term “candidate projects” indicates projects for which an application for inclusion on the regional lists was submitted. 4 As requested in Annex III.2(14) of the Regulation 2022/869 (TEN-E) 5 https://climate-advisory-board.europa.eu/reports-and-publications/towards-a-decarbonised-and-climateresilient-eu-energy-infrastructure-recommendations-on-an-energy-system-wide-cost-benefit-analysis/advice-ona-harmonised-eu.pdf/@@display-file/file

text: Opinion No 09/2023

text: The draft PCI/PMI assessment methodology for hydrogen and electrolysers has been circulated on 2 June 2023 to RG members for comments by 12 June 2023. 7 Regarding the consistent application of the criteria and the cost-benefit analysis across regions (requested in Annex III.2.14 of the TEN-E Regulation), ACER notes that according to the TEN-E Regulation, ACER is not obligated to provide an opinion on electrolysers. Regarding the assessment of smart gas grids (SGG) projects, ACER has not provided an opinion due to “Thematic area SGG” outcome of not to putting any of the SGG projects on the draft PCI/PMI lists.

text: Opinion No 09/2023

text: Source: ACER Report on Investment Evaluation, Risk Assessment and Regulatory Incentives for Energy Network Projects, June 2023. “ACER notes that in only five Member States (DE, LT, MT, PT, RO), NRAs reported competence (e.g. evaluation and/or tariff approval) for hydrogen infrastructure. In the remaining Member States, NRAs have no competence over hydrogen infrastructure or the legal basis giving competence over hydrogen infrastructure to NRAs has not been established yet. In some Member States the legislative framework on how to organise the hydrogen market and system development is under discussion.” 9 The Cooperation Platform is an informal, working level team, chaired by the European Commission, where representatives from the European Commission, ENTSO-E and the Agency discuss the issues pertaining to the PCI/PMI selection process, aiming at finding solutions for a better PCI selection.

text: Opinion No 09/2023

text: th By December 15 , 2022 11 mid-March 2023 12 The draft TYNDP 2022 was submitted to ACER for opinion on 26 May 2023. 13 https://circabc.europa.eu/ui/group/3ba59f7e-2e01-46d0-9683-a72b39b6decf/library/bc8707b5-a1c6-4bb6b702-159087ae48c0/details issued on 23 March 2023 14 Consultation started on 6 February and finished on 24 February.

text: Opinion No 09/2023

text: Ireland, Malta, and Cyprus 16 Consultation of a daft methodology started on 2 June and finished on 12 June 2023

text: Opinion No 09/2023

text: Opinion No 09/2023

text: The Delta Rhine Corridor H2 and Belgium - Germany interconnection (Antwerp-Eynatten pipeline & H2ercules West)

text: Opinion No 09/2023

text: Opinion No 09/2023 Annexes: Annex I - Statistics on NRAs’ assessment of candidate projects Annex II - Draft Regional PCI / PMI lists and NRA comments on individual projects

text: Opinion No 09/2023

text: Most NRAs did not have competences over hydrogen projects and did not have information, therefore couldn’t have assessed the projects from any of the aspects listed in the bullet points on this page. 20 ACER shared the detailed NRAs assessment table with the European Commission. 21 These criteria scrutinise whether the candidate project involves at least two Member States by directly crossing the border between them, or it is located in one Member State but has a significant cross-border impact, or it crosses the border of an EU Member State and a country of the European Economic Area. 22 These are: security of supply, market integration, competition and sustainability. 23 Including net present value, the benefit-to-cost ratio and the sensitivity of the cost figures, where applicable, due to non-availability of the Economic Performance Indicator data for NRAs, unless direct requests for such data were made by the NRAs to project promoters.

text: Opinion No 09/2023

text: In case of CZ-DE the divergent view is not drastic, as one Member State reported it had no opinion and the other one that the data were not consistent enough to make conclusions.

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text: Corridor Number of assessed candidate projects

text: Consistent No data provided Unable to assess Divergent views of NRAs

text: Number of assessed candidate projects

text: Project/project group is not No data provided Unable to assess mature enough

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text: Number of assessed candidate projects

text: Number of assessed candidate projects

text: Credible No data provided Unable to assess

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text: Number of assessed candidate projects

text: Corridor Project/project Yes group is not Unable to assess No data provided mature enough

text: Number of assessed candidate projects

text: In the same Divergent views of Later Unable to assess year NRAs

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text: Corridor Repurposing of an existing natural gas Not answered Other project

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text: Opinion No 09/2023

identifier: ACER Opinion No 09/2023

publisher: Europeiska unionens byrå för samarbete mellan energitillsynsmyndigheter

sprak: en

title: ACER Opinion 09-2023 on the draft regional lists of proposed Hydrogen Projects of Common Interest and Projects of Mutual Interest 2023

serie: yttranden

text: PUBLIC

type: stycke

text: OPINION No 09/2023 OF THE EUROPEAN UNION AGENCY FOR THE COOPERATION OF ENERGY REGULATORS of 29 September 2023 on the draft regional lists of proposed Hydrogen Projects of Common Interest and Projects of Mutual Interest 2023

type: rubrik

text: THE EUROPEAN UNION AGENCY FOR THE COOPERATION OF ENERGY REGULATORS, Having regard to

text: Regulation (EU) 2022/869

text: of the European Parliament and of the Council of 30 May 2022 on guidelines for trans-European energy infrastructure, amending Regulations

text: (EC) No 715/2009

text: (EU) 2019/942

text: and

text: (EU) 2019/943

text: and Directives

text: and

text: (EU) 2019/944

text: , and repealing

text: Regulation (EU) No 347/2013

text: and, in particular, Annex III.2(14) thereto, Having regard to the outcome of the consultation with the ACER’s Gas Working Group, Having regard to the favourable opinion of the Board of Regulators of 20 September 2023, delivered pursuant to

text: Article 22(5)

text: (a) of

text: Regulation (EU) 2019/942

text: of the European Parliament and of the Council of 5 June 2019 establishing a European Union Agency for the Cooperation of Energy Regulators (ACER) ,

text: Whereas:

text: 1. INTRODUCTION

text: (1) According to

text: Article 3 of Regulation (EU) 2022/869

text: (the ‘TEN-E Regulation’), a Union list of Projects of Common Interest (‘PCIs’) and Projects of Mutual Interest

text: (‘PMIs’) shall be established every two years, on the basis of the regional lists adopted by the decision-making bodies of the Regional Groups as set out in Annex III.1 to the same Regulation.

text: (2) The draft regional lists of proposed projects falling under the competence of National Regulatory Authorities (‘NRAs’) drawn up by the Regional Groups shall be submitted to ACER before the adoption date of the Union list . The draft list shall be accompanied by the Opinions of Member States to whose territory a proposed project does not relate, but on which the proposed project may have a potential net positive impact or a potential significant effect, which were presented to a Regional Group specifying its concerns.

text: (3) According to Annex III.2(8) to the TEN-E Regulation, the NRAs, and if necessary, ACER, shall check the consistent application of the criteria and cost-benefit analysis (‘CBA’) methodology and evaluate the cross-border relevance of the PCIs. They shall present their assessment to the Regional Groups.

text: (4) In view of the above, ACER coordinated NRA inputs and invited NRAs to provide structured assessments of the candidate projects by completing a questionnaire. Through this questionnaire, the NRAs provided structured assessments of the candidate projects on the eligibility criteria, as well as on the cost-benefit analysis of the projects and the elements affecting it (a summary of NRAs’ assessments are presented in Annex I to this Opinion).

text: (5) On 15 March 2023 the European Scientific Advisory Board on Climate Change (ESABCC) published its recommendations on a harmonised EU energy system-wide cost–benefit analysis, some of which are relevant to the PCI/PMI process and are considered by ACER. More specifically, ESABCC calls for more transparency in the coordination between ENTSO-E and ENTSOG, as well as between the European Commission and ENTSOs, and the highest possible accessibility to the market and network models used by ENTSOs to calculate projects’ costs and benefits.

text: (6) The NRAs’ assessments of the candidate projects were presented during the "Hydrogen and Electrolysers TEN-E Cross-Regional Groups meeting” held on 17 April 2023 and have also been considered as an input for preparing this Opinion.

text: (7) ACER shall assess the draft regional lists and the accompanying opinions from Member States within three months of the date of receipt. ACER shall provide an

text: Opinion on the draft regional lists, in particular, on the consistent application of the criteria and the cost-benefit analysis across regions.

text: (8) The European Commission released to the Regional Group members the final project assessment methodology on 16 June 2023, in the document “Methodology for assessing the hydrogen and electrolyser candidate PCI/PMI projects” (‘The PCI / PMI Selection Methodology’). The methodology, as well as the final scores and ranking of the candidate projects proposed for inclusion in the draft regional lists of PCIs and PMIs, to be submitted to the Decision-Making Bodies, were presented in the Regional Groups meetings held on 16 June 2023.

text: (9) The technical Decision-Making Bodies of the Regional Groups agreed on 28 June 2023 on which projects to include in the draft regional PCI/PMI lists.

text: (10) On 12 July 2023, the European Commission submitted to ACER the draft regional lists of proposed PCIs/PMIs (cf. Annex III to this Opinion) agreed by the technical Decision-Making Bodies of the Regional Groups and requested ACER’s opinion on the projects falling under the competence of national regulatory authorities.

text: (11) ACER herein provides its opinion concerning hydrogen transmission pipelines, terminals and storages set out in Annex II.3 to the TEN-E Regulation, i.e. regarding the HI West, HI East and BEMIP Hydrogen priority corridors. ACER is well aware at this point that the hydrogen sector is an infant sector, therefore this aspect has been taken into consideration when drafting the opinion.

text: (12) The draft Regional PCI/PMI lists submitted to ACER includes two projects for which Member States expressed support even where the initial assessment of project was not sufficient during the technical Decision-Making Bodies meeting.

text: (13) ACER notes that two gas PCIs associated with Malta and Cyprus, both of which are not interconnected to the trans-European gas network, have retained their status from th the previous 5 PCI list due to a derogation as outlined in Article 24 of the TEN-E Regulation.

text: (14) During the preparation of the draft PCI/PMI lists, a significant number of NRAs stated that they lack competence and jurisdiction over hydrogen projects within their respective Member States, therefore, currently they may not be in a position to offer scrutiny on the proposed hydrogen projects. At the time of NRA consultation process

text: on candidate projects, only five NRAs (DE, LT, MT, PT, RO) possessed the necessary competency to oversee hydrogen projects. Consequently, not all NRAs assessed the candidate projects at the national level and provided their perspectives during the PCI/PMI selection process.

text: 2. ASSESSMENT OF THE PCI/PMI SELECTION PROCESS AND DRAFT REGIONAL LISTS

text: The organisation of the PCI/PMI selection process

text: (15) ACER welcomes some aspects of the first hydrogen PCI/PMI selection process, including the involvement of various stakeholders in the Regional Groups meetings, the informative presentations on individual project proposals and the up-to-date information on all candidate projects. Additionally, ACER commends the European Commission's efforts to facilitate the extension of the energy system with new energy carriers during the challenging energy transition period, while considering future EU targets and managing delays in the finalisation of the TYNDP 2022. Despite these efforts, it remained at this point clear the lack of concreteness of the hydrogen candidate projects, which relates to the uncertainties of this emerging sector, where the applicable revenue model or the applicable regulatory regime is still under consideration.

text: (16) ACER commends the cooperation with the European Commission and the European Network of Transmission System Operators for Gas (ENTSOG) held in the framework of the Cooperation Platform .

text: (17) For future PCI/PMI selection processes, ACER sees a possibility for improvement in the timing of the discussions on the methodologies (i.e. the identification of system needs assessment methodology and the PCI/PMI selection methodology), which should take place at the beginning of the selection process, allowing sufficient time to the Regional Groups members for substantial discussions and developments and allowing to achieve the same level of understanding between these members. Furthermore, ACER believes that methodologies as well as their application and the

text: obtained results should firstly be discussed in the scope of the Cooperation Platform ahead of their presentation to the Regional Groups.

text: (18) The delays on the TYNDP 2022 and more specifically the non-availability of the project specific CBA results created hurdles in the PCI / PMI selection process. At the time of the submission of candidate projects and of the provision of NRAs’ assessment the draft TYNDP 2022 had not been yet submitted to ACER for opinion and the project specific CBA results were not available. ACER Opinion on the draft ENTSOG TYNDP 2022 was issued only on 14 July 2023. The nonavailability of the complete and final TYNDP data could not allow a proper assessment of projects by NRAs and the other Regional Groups members. Therefore, ACER recommends that key information on candidate projects (especially their costs and benefits) that impact the project assessment must be finalised before the project assessment starts and be subject to the PCI/PMI candidates public consultation. ACER also requests that the ENTSOG TYNDP, which provides the necessary data for the project assessment, to take into account ACER’s opinion and be finalised before the project assessment starts, including also the results of the CBA assessment of the candidate projects.

text: Identification of hydrogen infrastructure needs

text: (19) The approach followed by the Regional Groups regarding the identification of hydrogen infrastructure needs is described in the European Commission document “Identification of Hydrogen infrastructure needs for the TEN-E priority corridors” . The list of regional needs per corridor was presented in the Regional Groups meetings on 20 March 2023.

text: (20) The methodology implemented was consulted with the Regional Groups and is based on indicators to identify each specific need, namely, improvement of market integration, sustainability and security of supply. Due to lack of reliable input data for the hydrogen supply and demand per Member State, the identification of hydrogen needs methodology was simplified and assessed only three needs, with one indicator per each need, i.e. market integration, curtailed hydrogen demand and variation of greenhouse gas emissions.

text: (21) Based on this methodology, the hydrogen infrastructure needs per Member States were identified and all Member States have shown a need in “improvement in market integration” and “sustainability”. Moreover, the analysis identified a security of

text: supply need only for isolated Member States . These outcomes may require further considerations, as how to further improve the methodology to fit the future system needs identification process.

text: (22) For the purpose of the current PCI/PMI selection process, taking place for the first time and while lacking firm input data on hydrogen demand and supply, ACER understands that the current uncertainties lead to the adoption of such simplified approach. Looking ahead to future selection processes, ACER recommends Regional Groups to dedicate further efforts in the next PCI/PMI selection round to refine the process of identifying infrastructure needs for hydrogen projects, with the objective to develop a more robust methodology that yields outcomes tailored to address potentially growing requirements for future hydrogen market development.

text: The selection methodology for candidate projects

text: (23) The final selection methodology was described in the Commission’s document “Methodology for assessing the hydrogen and electrolyser candidates PCI/PMI projects” that was presented and adopted on 16 June 2023 in the Regional Groups meeting .

text: (24) ACER commends the Commission's efforts to develop a selection methodology that addresses the unique challenges posed by the uncertainty of input data for future hydrogen demand and supply and the non-maturity of the hydrogen market in general. The development of such a methodology, given the infancy of the hydrogen landscape is complex and demonstrates a proactive approach. At the same time, given the limitations of the current hydrogen market, ACER points out the importance of a continuous improvement and refinement of the methodology for future selection processes, allowing for more accurate and comprehensive evaluation of candidate projects.

text: (25) In this respect, ACER recommends the following:

text: • the future TYNDPs should better fit the purpose of the PCI/PMI selection process, by providing a sufficient level of information on the candidate projects, including project specific CBA results, before a beginning of the selection process; • in the early stages of the hydrogen market development, ACER recommends that candidate projects should show certain level of concreteness (being in a more advanced development stage) in order to be qualified as eligible for the PCI/PMI list;

text: • regarding the benefits monetisation, ACER understands that certain benefits are intrinsically difficult to monetise and that in such cases a kind of normalisation is used in order to determine a relative benefit/cost ratio. ACER considers such approach as pragmatic, but not necessarily leading to coherent outcomes. Therefore, ACER recommends paying further attention to the monetisation of benefits; • taking into consideration in the next PCI/PMI selection methodology the hydrogen specific CBA methodology, that is being currently under finalisation. This would allow Regional Groups to make more informed decisions, better ensuring that selected projects are having more benefits recognised compared to the costs and effectively contributing to the advancement of the hydrogen sector. ACER has published a consultancy study on this matter, with recommendations for the CBA methodology for hydrogen infrastructures that ENTSOG is developing for future TYNDPs; • regarding the scenario used, according to the PCI/PMI selection Methodology, the assessment was “primarily based on benefits estimated under the 2030 Distributed Energy scenario of the TYNDP 2022”, plus taking into account further data on national hydrogen plans of Member States and project promoters, and “the choice of the scenario was made considering the consistency of ENTSOs scenarios with the latest Commission scenario used for the Climate Target Plan impact assessment and also the consistency with the electricity PCI/PMI process”. In ACER’s view, a scenario in alignment with the European Union targets can be used for the assessment, however, the Commission should strive to take into consideration more than a single scenario in the next selection rounds. Otherwise it may result in biased outcomes by missing other possible futures, both in terms of infrastructure needs and assessments of individual projects. In addition, applying the study years beyond 2030 would reduce uncertainties of results in the longer assessment period.

text: (26) Furthermore, ACER calls for a greater transparency of the application of the selection methodology as well as the results obtained for candidate projects. Also the application of grouping of candidates and its impact on the results is, for instance, one of the elements which remains largely non-transparent. ACER is of the opinion that the application as well as the results should be available to all members of the Regional Groups, rather than being only available and discussed bilaterally with the concerned promoters.

text: Assessment of the draft regional lists

text: (27) Regarding the consistency of the PCI/PMI selection across regions, ACER notes that the same terms of reference for Regional Groups, identification of infrastructure needs methodology and selection methodology were applied for the evaluation of the three

text: specific criteria of

text: Article 4(3)

text: d of the TEN-E Regulation across all regions. Therefore, a certain degree of consistency was safeguarded throughout the process and across all regions.

text: (28) ACER notes that a generic emerging corridor covering Ukraine, Slovakia, Czechia, Austria, and Germany has been included in the regional list HI EAST Hydrogen transmission projects, which otherwise would have had a negative assessment due to the uncertain hydrogen source. The primary purpose of this corridor, according to the Commission, is to facilitate in the future the transmission of hydrogen from Ukraine to Central and Western Europe, aiming to acknowledge Ukraine's hydrogen production potential and the necessity of its transmission towards Central Europe. To enhance the clarity of this “generic project group" or "generic corridor," ACER recommends to clearly divide it into more individual projects within the corridor. Additionally, in order to avoid uncertainties there should be further clarification of this emerging corridor provided, especially in terms of its PCI/PMI status and its privileges compared to a “normal” PCI project.

text: (29) ACER notes that inclusion and exclusion criteria for a “generic corridor” should be further clarified and defined as to projects and participating countries.

text: (30) Within the draft PCI/PMI lists submitted to ACER, two additional PCI projects have been included on the basis of the support of the respective Member States and their assurance that new data is available for the projects, despite that the benefits assessment of these candidate projects had initially fallen short of the set threshold. In light of this, ACER recommends that the Regional Group conducts a reassessment of these two projects, providing all the assumptions and results to all Regional Groups members.

text: (31) ACER highlights that, in the early stages of the hydrogen development, it remains important to understand the rationale behind the grouping of the specific project groups or the creation of new generic projects. The Commission should transparently communicate this early on to the Regional Groups, to keep the concerned project promoters and Members States informed and aligned. The regrouping should be timely and take place before NRAs assessment of projects. Otherwise, the NRA assessment of projects might fall short.

text: (32) In Annex II, NRAs views on the projects included in the draft Regional PCI/ PMI lists are presented, building on the joint assessments of candidate projects by NRAs, the statistics of which are presented in Annex I to this Opinion. In total, project promoters submitted 179 candidate projects/project groups to the PCI/PMI selection process. Among these projects, 19 have been indicated as being in an "Advanced" maturity status, where one project reached the stage of FID (Final Investment Decision). The

text: remaining 159 projects have been indicated as less advanced, meaning that they are still in the early stages of planning and development and generally lacked maturity and concreteness. The level of immaturity of projects causes challenges for NRAs when it comes to projects’ assessment and evaluation. Furthermore, the regulatory status of projects, namely whether projects will be regulated or not, at this point, was largely unclear because the EU regulatory package on hydrogen has yet to be established,

text: HAS ADOPTED THIS OPINION:

text: 1. ACER commends the Commission's efforts to develop the system needs identification and the project selection methodologies that address the unique challenges of the current stage of hydrogen sector development, emphasizing proactive steps despite the complexities of the evolving hydrogen landscape, which demonstrates a commitment to fostering a mature and robust hydrogen energy sector in the future. 2. ACER’s and NRAs' assessment on the projects of the draft regional PCI/PMI lists is provided in section 2.4, Annex I and II of this Opinion.

text: 3. ACER is unable to assess the consistent application of the criteria of the TEN-E Regulation and of the cost-benefit analysis to all the candidate projects due to:

text: (i) unavailability of the project specific CBA results for the candidate projects as part of the TYNDP 2022;

text: (ii) lack of full transparency in the results from applying the PCI / PMI Selection Methodology and project grouping in the selection process;

text: (iii) the infancy of the hydrogen sector and the ongoing legislative process on hydrogen regulation, the majority of NRAs lacked abilities to scrutinise the candidate projects.

text: 4. To help tackle the deficiencies listed above and enable ACER to perform its legal duty, the Regional Groups should work on improving the transparency of the process and the methodologies used in the next PCI/PMI selection process, taking into account ACER’s recommendations included in this Opinion.

text: This Opinion is addressed to the European Commission.

text: Done at Ljubljana, on 29 September 2023.

text: - SIGNED –

text: Fоr the Agency The Director

text: C. ZINGLERSEN

text: Annex I - Statistics on NRAs’ assessment of candidate projects

text: In line with the provisions of Annex III, 2.(8),

text: Regulation (EU) 2022/869

text: , the NRAs cooperating in the framework of ACER checked the consistent application of the criteria and the CBA methodology and evaluated the cross-border relevance of the candidate projects for PCI lists. The NRA checks and evaluations were carried out between 8 February 2023 and 3 March 2023. The scope of the assessments covered the candidate projects and project groups. The summary of the assessment results was communicated to the Regional Groups on 17 April 2023 . The assessment included the following main elements: • Compliance with the criteria of cross-border relevance , in line with

text: Article 4(1)

text: (c) of Reg.

text: (EU) 2022/869

text: • Compliance with the specific policy criteria , in line with 4(3)(d) of Reg.

text: (EU) 2022/869

text: • Presence of the candidate projects in the National Development Plans of the hosting Member States; • Consistency of the indicated capital expenditure (CAPEX) and operational expenditure (OPEX) data of the project and the information available to the NRA from other sources; • Consistency and validity of the simulation results and the Economic Performance Indicators ; • Credibility of the qualitative analysis; • Whether the overall benefits by the project outweigh its costs; • NRAs’ own assessment of the realism of the indicated commissioning date; and • Objections (if any) to the inclusion of the candidate project in the PCI/PMI lists.

text: General statistics of the candidate projects assessment In total submitted 179 candidate projects/project groups for the PCI/PMI lists. Among these projects, 19 have been designated as being in an "Advanced" maturity status. Additionally, one

text: project has reached the crucial stage of FID (Final Investment Decision). The remaining projects (159) have been classified as less advanced, suggesting that they are still in the early stages of planning and development. The NRAs examined 50 PCI candidates at the group level (out of the 59 in total) and 9 at individual level. The individual projects include: HYD-N-1051, HYD-N-1092, HYD-N-385, TRA-A-10, TRA-A-35, TRA-A-70, RET-N-916, HYD-N-1065, HYD-N-1100. Cross-border relevance Regarding cross-border relevance, NRAs indicated 23 candidate projects as not being able to be assessed against criteria of

text: Article 4(1)

text: (c) of the

text: Regulation (EU) No 2022/869

text: . 12 candidate projects are located on the territory of one Member State, either inland or offshore, including islands, and has a significant cross-border impact as set out in point (1) of Annex IV, while 18 projects involve at least two Member States by directly or indirectly, via interconnection with a third country, crossing the border of two or more Member States. Finally, for 5 candidate project groups/individual projects NRAs did not provide an answer. Meeting specific criteria according to TEN-E

text: Articles 4(3)

text: For 10 of the candidate projects, NRAs indicated that it’s unclear if they meet any of the four specific criteria, as they were not able to assess them (PRJ-G-133, PRJ-G-247, PRJ-G-250, PRJ-G-261, PRJ-G-269, PRJ-G-274, PRJ-G-276, PRJ-G-279, PRJ-G-280 and individual project HYD-N-1100), while 33 of the assessed projects contribute to all four specific policy criteria.

text: Inclusion in the national development plan (NDP) 33 projects were not included in any of the current national NDP according to NRAs. In 10 cases, not all of the projects are included, and they are only included in some of the hosting Member State NDP(s), while 16 projects are included in all hosting Member State NDP(s). Objection of NRAs to the inclusion on the PCI lists In 2 cases [for projects PRJ-G-134 and RET-N-916], Slovakian NRA objects to the inclusion of the project (candidate PCI/PMI) in the final Regional Union list, while for PRJ-G-261, Estonian NRA is not able to assess. CAPEX and OPEX consistency By looking at the consistency of CAPEX and OPEX estimations, NRAs confirmed for 17 of the candidate projects that the data for CAPEX is consistent and 11, regarding OPEX costs. Moreover, values of CAPEX and OPEX were not provided for 13 candidate projects, while for 27 candidate projects, NRAs were not able to assess the consistency of CAPEX values as well as for 34 in respect of OPEX values. Notably, divergent views among NRAs were observed for candidate projects PPJ-G-284 (between Germany and Czech Republic ) with regards to CAPEX and PPJ-G-286 (between Hungary and Slovenia) on both CAPEX and OPEX.

text: Credibility of simulation results The NRAs were not able to assess the credibility of simulation results for a significant number of candidate projects, specifically 29 in total. Additionally, 25 projects either lacked the necessary modelling results or were not subjected to modelling at all. Additionally, 5 candidate projects were deemed immature and thus were not assessed. Furthermore, for 32 projects, economic performance results (EPIs) were not provided to the NRAs, and out of these, 22 projects were not assessed from the NRAs. Among these, 5 projects were classified as immature and were unable to be properly assessed by the NRAs. Timelines of commissioning date Regarding the planned commissioning dates, NRAs estimated that 26 of the assessed projects could be completed by the indicated deadline. For 6 of the assessed projects, NRAs indicated that their commissioning could realistically take place at a later date than the one indicated by the promoter, and for 26 candidate projects the NRAs were unable to assess the credibility of the indicated commissioning date. Assessment of candidate projects’ benefits and costs Hungarian and Slovak NRAs indicated that for 2 projects (PRJ-G-224 and RET-N-916) benefits outweigh costs, while the rest were either not able to assess (41 candidate projects) or were not provided with the results (11 candidate projects). Finally, 5 candidate projects were not mature enough to be assessed. Below we present statistics in tables based on the candidate projects’ assessment provided by NRAs:

text: NRA assessments statistics by corridor

text: Corridor Assessments per Assessment in Coordination with corridor coordination with non-EU country other EU-NRAs

text: Hi East 37 10 3

text: Hi West 17 0 0

text: BEMIP Hydrogen 5 1 0

text: Total 59 11 3

text: Consistency of CAPEX figures

text: Number of assessed candidate projects

text: Corridor No data Unable to Divergent views of Consistent provided assess NRAs

text: HI East 7 12 16 2

text: HI West 8 0 9 0

text: BEMIP 2 0 3 0 Hydrogen

text: Total 17 12 28 2

text: Divergent views of NRAs were expressed for PPJ-G-284 between Germany and Czech Republic and PPJ-G-286 between Hungary and Slovenia.

text: Consistency of OPEX figures

text: HI East 1 13 22 1 HI West 8 0 9 0 BEMIP 2 0 3 0 Hydrogen

text: Total 11 13 34 1

text: Divergent views of NRAs were expressed for PPJ-G-286 between Hungary and Slovenia

text: Specific simulation results (identifying benefits)

text: Corridor

text: HI East 15 17 5 HI West 8 9 0

text: BEMIP 2 3 0 Hydrogen

text: Total 25 29 5

text: Credibility of EPIs (NPV, IRR, B/C ratio)

text: Corridor

text: HI East 24 8 5 HI West 8 9 0 BEMIP 0 5 0 Hydrogen

text: Total 32 22 5

text: Credibility of qualitative analysis (i.e. apparently reasonable, valid, truthful)

text: Corridor

text: HI East 2 23 12 HI West 0 8 9 BEMIP 0 0 5 Hydrogen

text: Total 2 31 26

text: Do benefits outweigh the costs?

text: HI East 2 5 27 3 HI West 0 0 9 8 BEMIP 0 0 5 0 Hydrogen

text: Total 2 5 41 11

text: NRAs assessment of the commissioning date

text: Corridor

text: HI East 23 6 7 1 HI West 1 0 16 0 BEMIP 0 0 5 0 Hydrogen

text: Total 24 6 28 1

text: Divergent views of NRAs were expressed for PPJ-G-284 between Germany and Czech Republic. However, the inconsistency regarding the project PPJ-G-284 was later explained to the EC, and currently there are no divergent views.

text: The concerned PCI/PMI project is:

text: HI East 12 0 25 HI West 2 0 15 BEMIP 0 3 2 Hydrogen

text: Total 14 3 42

text: Annex II - Draft Regional PCI / PMI lists and NRA comments on individual projects

text: HI WEST Hydrogen transmission projects

text: PCI/PMI Project Project name NRA comments candidate number

text: PCI Corridor Portugal – Spain – CNMC (Spanish NRA) is not competent on France - Germany H2 and doesn´t receive information on these

text: for H2 to avoid possible overinvestments.

text: BNetzA (German NRA) does not approve H2 projects as part of the (natural) gas network development plan. Hence, BNetzA is not in a position to assess the project and therefore takes a neutral position. In case the project involves the repurposing of a natural gas infrastructure, the assessment is neutral subject to the condition that it would not trigger significant additional investment in the gas system to ensure the integrity of the

text: natural gas system. HYD-N-978 - Internal infrastructure in ERSE (PT NRA): This project was included Portugal in the proposal of the NPD 2023 (2024 to

text: 2033) which was submitted by the TSO on 31/mar. That NDP proposal was subjected to a public consultation process that took place between 8/5 and 20/6/23. ERSE’s Opinion will be sent in the following weeks. This project does not belong to an approved

text: NDP. There are several doubts about it,

text: namely in terms of costs/benefits and demand. In this particular issue, it seems to derive from national objectives and not from

text: the market.

text: HYD-N-1156 - Interconnection Portugal ERSE (PT NRA): Same comment as above HYD-N-1324 – Spain on HYD-N-978.

text: CNMC is not competent on H2 and doesn´t receive information on these projects. Up to date, in Spain there are an H2 roadmap and a draft Spanish National Energy and Climate Plan 2023-2030 (currently under public consultation). This last one includes objectives on H2 production and use in industry and transport, as well as references to the Iberian Hydrogen Corridor and H2MED projects. Spain does not have a NDP for the H2 yet. In any case, CNMC considers it is important to assure there is enough demand for H2 to avoid possible

text: overinvestments. HYD-N-1149 - Internal infrastructure in CNMC is not competent on H2 and doesn´t Spain except Guitiriz - receive information on these projects. Up to Zamora H2 Pipeline date, in Spain there are an H2 roadmap and

text: overinvestments. HYD-N-1151 - Interconnection Spain - CNMC is not competent on H2 and doesn´t France (currently known as receive information on these projects. Up to HYD-N-1153 BarMar) date, in Spain there are an H2 roadmap and HYD-N-819 a draft Spanish National Energy and

text: overinvestments. HYD-N-569 - Internal infrastructure in France connecting to Germany (currently known

text: as HyFen) except Section Saint Martin de Crau – Cruzy HYD-N-1052 - Internal infrastructure in BNetzA does not approve H2 projects as part Germany connecting to of the (natural) gas network development France (currently known as plan. Hence, BNetzA is not in a position to H2Hercules South) assess the project and therefore takes a

text: neutral position. In case the project involves the repurposing of a natural gas infrastructure, the assessment is neutral subject to the condition that it would not trigger significant additional investment in the gas system to ensure the integrity of the

text: natural gas system. PCI France-Germany cross- BNetzA does not approve H2 projects as part border hydrogen valleys: of the (natural) gas network development HYD-N-1096 - Interconnection France- plan. Hence, BNetzA is not in a position to HYD-N-969 Germany (currently known assess the project and therefore takes a as RHYn) except section neutral position. In case the project involves Freiburg – Offenburg the repurposing of a natural gas

text: infrastructure, the assessment is neutral subject to the condition that it would not trigger significant additional investment in the gas system to ensure the integrity of the

text: natural gas system. HYD-N-987 - Interconnection France- BNetzA does not approve H2 projects as part HYD-N-899 Germany (currently known of the (natural) gas network development as Mosahyc) plan. Hence, BNetzA is not in a position to

text: natural gas system. PCI HYD-N-1311 Internal infrastructure in Belgium (currently known as Belgian Hydrogen Backbone) PCI HYD-N-468 Internal infrastructure in the Netherlands (currently known as National Hydrogen Backbone) except Limburg area and its connection to the North-

text: South backbone in the East of the Netherlands

text: PCI HYD-N-1035 Internal infrastructure in France at the border to Belgium (currently known as Franco-Belgian H2 corridor) PCI HYD-N-991 German offshore pipeline BNetzA does not approve H2 projects as part (currently known as of the (natural) gas network development AquaDuctus) plan. Hence, BNetzA is not in a position to

text: natural gas system. PCI HYD-N-1001 Interconnection Denmark – BNetzA does not approve H2 projects as part Germany (currently known of the (natural) gas network development as West DK hydrogen plan. Hence, BNetzA is not in a position to HYD-N-1236 system; HyperLink III) assess the project and therefore takes a

text: natural gas system. PMI HYD-N-884 Offshore pipeline Norway- Germany (currently known as CHE Pipeline) PCI HYD-N-757 Interconnection Austria- E-Control (AT NRA): HYD-N-757 is Germany (currently known included in the Austrian NDP 2022. The as H2 WAG and Penta Austrian NDP was approved by E-Control in HYD-N-642 West; HyPipe Bavaria) June 2023.

text: trigger significant additional investment in the gas system to ensure the integrity of the

text: natural gas system. PCI Belgium - Germany (part of) interconnection: HYD-N-1311 - Antwerp-Eynatten pipeline (part of the Belgian Hydrogen Backbone) HYD-N-1038 - Internal infrastructure in BNetzA does not approve H2 projects as part Germany (currently known of the (natural) gas network development as H2ercules West) plan. Hence, BNetzA is not in a position to

text: natural gas system. PCI Interconnections National Hydrogen Backbone (NL) – Germany: HYD-N-1037 - Connection from the BNetzA does not approve H2 projects as part HYD-N-468 North-South backbone in of the (natural) gas network development East to Oude (Netherlands) plan. Hence, BNetzA is not in a position to - H2ercules North assess the project and therefore takes a (Germany) neutral position. In case the project involves

text: the repurposing of a natural gas infrastructure, the assessment is neutral subject to the condition that it would not trigger significant additional investment in the gas system to ensure the integrity of the

text: natural gas system. HYD-N-906 - Connection from the HYD-N-468 North-South backbone in East to Vlieghuis (Netherlands) - Vlieghuis- Ochtrup (Germany) HYD-N-1075 - Connection from the HYD-N-468 North-South backbone in East to Zevenaar/Elten (Netherlands) - H2ercules North-West (Germany) HYD-N-793 Cross-border pipeline from Netherlands to Germany (currently known as Delta Rhine Corridor H2)

text: HI WEST Hydrogen reception facilities

text: PCI HYD-N-664 Ammonia reception facility Antwerp (Fluxys Belgium) PCI HYD-N-1100 Ammonia reception facility Amplifhy Antwerp (Belgium) PCI HYD-N-1325 Zeebrugge New Molecules development ammonia reception facility (Belgium) PCI HYD-N-820 Ammonia reception facility Dunkerque (France) PCI HYD-N-543 Rotterdam LH2 reception facility, except the ship (Netherlands) PCI HYD-N-1127 Ammonia reception facility Amplifhy Rotterdam (Netherlands) PCI HYD-N-754 Ammonia reception facility ACE Rotterdam (Netherlands) PCI HYD-N-1099 Ammonia reception facility BNetzA does not approve H2 projects as terminal Brunsbüttel part of the (natural) gas network (Germany) development plan. Hence, BNetzA is not in

text: integrity of the natural gas system. PCI HYD-N-1159 Ammonia reception facility BNetzA does not approve H2 projects as Wilhelmshaven (BP) part of the (natural) gas network (Germany) development plan. Hence, BNetzA is not in

text: integrity of the natural gas system.

text: HI WEST Hydrogen storage facilities

text: PCI HYD-N-1238 Danish Hydrogen Storage (Denmark) PCI HYD-N-1279 Hystock Opslag H2 storage (Netherlands) PCI HYD-N-934 Salthy hydrogen storage BNetzA does not approve H2 projects as Harsefeld (Germany) part of the (natural) gas network

text: integrity of the natural gas system. PCI HYD-N-767 H2 Storage Gronau-Epe BNetzA does not approve H2 projects as (Germany) part of the (natural) gas network

text: integrity of the natural gas system. PCI HYD-N-565 Storage GeoH2 (France)

text: PCI HYD-N-508 H2 storage North-1 (Spain) CNMC is not competent on H2 and doesn´t

text: not have a NDP for the H2 yet. In any case,

text: CNMC considers it is important to assure

text: there is enough demand for H2 to avoid

text: possible overinvestments. PCI HYD-N-1152 H2 storage North-2 (Spain) CNMC is not competent on H2 and doesn´t

text: CNMC considers it is important to assure there is enough demand for H2 to avoid

text: possible overinvestments.

text: HI EAST Hydrogen transmission projects

text: PCI Hydrogen Corridor Italy- Austria-Germany: HYD-N-1205 - Italian H2 Backbone At present ARERA(IT NRA) has no except section Poggio competence on assessing H2 projects, Renatico to Gries Pass therefore ARERA takes a neutral position. HYD-N-986 - H2 Readiness of the E-Control (AT NRA): HYD-N-986 is TAG pipeline system included in the Austrian NDP 2022 as a

text: planning project. The Austrian NDP was

text: approved by E-Control in June 2023. HYD-N-757 - H2 Backbone WAG + E-Control (AT NRA): HYD-N-757 is Penta West included in the Austrian NDP 2022. The

text: Austrian NDP was approved by E-Control

text: in June 2023. HYD-N-642 - HyPipe Bavaria – The BNetzA does not approve H2 projects as Hydrogen Hub part of the (natural) gas network

text: development plan. Hence, BNetzA is not in a position to assess the project and therefore takes a neutral position. In case the project involves the repurposing of a natural gas infrastructure, the assessment is neutral subject to the condition that it

text: would not trigger significant additional investment in the gas system to ensure the

text: integrity of the natural gas system. PCI Czech German Hydrogen BNetzA does not approve H2 projects as Interconnection (Route part of the (natural) gas network from Baltic region): development plan. Hence, BNetzA is not in

text: integrity of the natural gas system. HYD-N-796 - FLOW East - Making BNetzA does not approve H2 projects as Hydrogen Happen part of the (natural) gas network

text: integrity of the natural gas system. HYD-N-1034 - Czech German ERÚ (CZ NRA): Hydrogen Interconnector Having in mind, that updated Energy Act (CZ part) will be put in force in 2024, which will

text: valid. No EIA would have to be conducted, as well as no extra permitting process.

text: As CAPEX is concerned, ERÚ is not able

text: to decide whether the costs are justifiable, hydrogen technology is rather new topic.

text: However, amongst other project of the same extent throughout the EU, this project seems rather efficient in costs and justifiable in comparison with other

text: projects.

text: However, this assessment is currently strictly non-binding, as the NRA is still not

text: competent in the matter of hydrogen.

text: BNetzA does not approve H2 projects as part of the (natural) gas network development plan. Hence, BNetzA is not in a position to assess the project and therefore takes a neutral position. In case the project involves the repurposing of a natural gas infrastructure, the assessment is neutral subject to the condition that it would not trigger significant additional investment in the gas system to ensure the

text: integrity of the natural gas system. PCI Hydrogen Interconnection Bulgaria -Greece: HYD-N-970 - Dedicated H2 Pipeline in Greece except section Karperi to Komotini HYD-N-788 - H2 transmission system in Bulgaria PCI/PMI No TYNDP Generic Corridor between URSO(SK NRA): this innovative project is number Ukraine, Slovakia, Czechia, in line with the transitions and Austria, and Germany decarbonisation goals of EU. Present

text: significant diversification of sources. At this stage, when the H2 legislative framework is still missing, the assessment of the project cannot be properly provided only as a “general benefit”. Slovakia set out “Action plan” supporting the implementation of “National H2 strategy” covering also development of projects in transmission infrastructure and storage for

text: H2, but with a limited period 2023-2026, and this project is exceeding this limit.

text: ERÚ (CZ NRA) - CZ part: The same support as for project HYD-N- 1034 applies.

text: Having in mind, that updated Energy Act will be put in force in 2024, which will introduce an inclusion of hydrogen in the current definition of gas, the legislative framework will be in place to approve hydrogen projects. Therefore, ERÚ does not see any obstacles in repurposing of this pipeline to pure hydrogen in case of sufficient demand. Overall, 5 years to the deadline of 2029 seems sufficient for pipeline repurposing – given the technical and administrative steps needed to commission the new pipeline ERÚ can conclude that the pipeline is not extensively used at the moment, all land rights will stay

text: As CAPEX is concerned, ERÚ is not able

text: projects.

text: competent in the matter of hydrogen.

text: integrity of the natural gas system.

text: BEMIP H2 transmission projects

text: PCI HYD-N-1171, Hydrogen interconnector HYD-N-1136, between Sweden and HYD-N-1172, Finland (known as Nordic HYD-N-1350 Hydrogen Route – Bothnian Bay) except section Kiruna to Lulea (SE) PCI HYD-N-1122, Hydrogen interconnector BNetzA does not approve H2 projects as HYD-N-1144, between Finland, Estonia, part of the (natural) gas network HYD-N-1239, Latvia, Lithuania, Poland development plan. Hence, BNetzA is not in HYD-N-1280, and Germany (known as a position to assess the project and HYD-N-1310, Nordic-Baltic Hydrogen therefore takes a neutral position. In case HYD-N-443, Corridor) except for: the project involves the repurposing of a HYD-N-1036 - 4 internal sections of natural gas infrastructure, the assessment the FI pipeline is neutral subject to the condition that it Kyröskoski ; Imatra; would not trigger significant additional Loviisa, through investment in the gas system to ensure the Kotka and Porvoo integrity of the natural gas system. through Tolkinnen (geographical references are approximate and solely given as indications) - Internal line in LT connecting to Klaipeda - One section of the DE pipeline from Magdeburg to Potsdam (geographical references are approximate and solely given as indications) PCI HYD-N-1355, Interconnection between BNetzA does not approve H2 projects as HYD-N-926, Sweden, Finland and part of the (natural) gas network HYD-N-848, Germany (known as the development plan. Hence, BNetzA is not in HYD-N-931 Baltic Sea Hydrogen a position to assess the project and Collector) therefore takes a neutral position. In case

text: the project involves the repurposing of a natural gas infrastructure, the assessment is neutral subject to the condition that it

text: integrity of the natural gas system.

text: Projects that maintain their status of a PCI (

text: Article 24

text: derogation)

text: PCI PCI 5.19 Connection of Malta to the European gas network – pipeline interconnection with Italy at Gela

text: PCI PCI 7.3.1 Pipeline from the East Mediterranean gas reserves to Greece mainland via Cyprus and Crete [currently known as “EastMed Pipeline”], with metering and regulating station at Megalopoli


text: Source: Winter Supply Outlook (‘the Outlook’) 2024/25, including a Summer 2025 Overview

text: Opinion No 09/2024

text: Opinion No 09/2024

text: The immobilisation of gas into storage ensures that a share of the stock is only used in exceptional circumstances to prevent demand curtailment. ENTSOG’s Outlook (p.18) assumes constraints on the utilisation of the strategic reserves of storages, which cannot be depleted to avoid/reduce demand curtailment in the simulations. However, EU gas strategic reserves (amounting to circa. 120 TWh) should be rather used before curtailing demand. i.e. that it is only filled after other storages in the Union have been filled up to target levels.

text: Opinion No 09/2024

text: OIES Quarterly Gas Market Review, October 2024, p. 18. 5 For example, the ALSI platform publishes capacity forecast data for the upcoming 6 months which could be considered when building the reference LNG supply scenario: https://alsi.gie.eu/capacity-forecast. However, the availability of information of booked capacities is challenging, also in view to the trend towards shorter-term bookings. 6 The Reference LNG supply case: max 30-day rolling average; the Low LNG: average historical flows over the last five years for each season; the High LNG: limited by the regasification capacity of European LNG terminals and transmission network. 7 ACER LNG Market Monitoring Report, April 2024. In 2023, the EU imported 18 bcm of Russian LNG, mostly via long-term supply agreements signed before 2022. ACER notes that recent volumes of Russian LNG imports to Europe are significant and pose challenges for short-term replacement from other LNG origins.

text: Opinion No 09/2024

text: See ENTSOG WSO 2024/25, p. 9 for the list. 9 A list of LNG capacities/terminals considered in the Outlook should be provided for transparency. 10 By publishing the same dataset for Outlooks and TYNDP, ENTSOG would provide an up-to-date description of the infrastructure capacities used in its reports. 11 Council of the European Union: Security of gas supply, 25.03.2024 12

text: Council Regulation (EU) 2022/1369

text: on coordinated demand-reduction measures for gas. 13 Ibid.

text: Opinion No 09/2024

text: Gas consumption decreased marginally (est. -69 TWh) from January to August compared with the same period in 2023. Lower gas burn for power generation and stagnant household demand more than outweighed the minor increase in industrial gas demand (est. +9 TWh in Q3). Source: ACER analysis based on Eurostat, ENTSOG, ENTSOE and Trading Hub Europe data. See Key developments in European gas markets – Q3 2024, October 2024. 15 Ibid. 16 Characterised by minimal or no wind and solar power generation due to a lack of wind or sunlight.

text: Opinion No 09/2024

text: E.g. ENTSOG’s efforts to consider a low LNG supply scenario that excludes Russian LNG imports.

text: Opinion No 09/2024

identifier: ACER Opinion No 09/2024

title: ACER Opinion 09-2024 on ENTSOG’s Winter Supply Outlook 2024/25

text: PUBLIC

text: OPINION No 09/2024 OF THE EUROPEAN UNION AGENCY FOR THE COOPERATION OF ENERGY REGULATORS of 18 December 2024 on ENTSOG’s Winter Supply Outlook 2024/25

text: THE EUROPEAN UNION AGENCY FOR THE COOPERATION OF ENERGY REGULATORS, Having regard to

text: Regulation (EU) 2019/942

text: of the European Parliament and of the Council of 5 June 2019 establishing a European Union Agency for the Cooperation of Energy Regulators (‘ACER’), and, in particular,

text: Article 4(3)

text: (b) thereof, Having regard to

text: Regulation (EU) 2024/1789

text: of the European Parliament and of the Council of 13 June 2024 on the internal markets for renewable gas, natural gas and hydrogen, and, in particular, Articles

text: and

text: thereof, Having regard to the outcome of the consultation with the ACER’s Gas Working Group, Having regard to the favourable opinion of the Board of Regulators of 18 December 2024, delivered pursuant to

text: Article 22(5) of Regulation (EU) 2019/942

text: , Whereas:

text: 1. INTRODUCTION

text: (1) On 16 October 2024, the European Network of Transmission System Operators for Gas (‘ENTSOG’) published its Winter Supply Outlook (‘the Outlook’) 2024/25, including a Summer 2025 Overview pursuant to

text: Article 26(3)

text: (g) of

text: Regulation (EU) 2024/1789

text: . (2) Pursuant to

text: Article 4(3)

text: (b) of

text: Regulation (EU) 2019/942

text: , ACER may provide an Opinion to ENTSOG on, inter alia, relevant documents referred to in

text: Article 26(3) of Regulation (EU) 2024/1789

text: , as submitted by ENTSOG to ACER pursuant to

text: Article 27(2) of Regulation (EU) 2024/1789

text: 2. SUMMARY OF THE ENTSOG WINTER SUPPLY OUTLOOK 2024/25

text: (3) ENTSOG’s Winter Supply Outlook includes EU-wide simulations of the European gas infrastructure readiness to deliver sufficient gas supply to meet demand under certain gas supply scenarios. The Outlook also includes the assessment of gas infrastructure under scenarios of prolonged disruptions of Russian gas imports for the upcoming winter 2024/2025, and additional insights into the EU’s gas system’s preparedness for the summer of 2025. (4) ENTSOG assessed the European gas system resilience under both typical and cold winter conditions, accounting for high demand and potential intermissions in Russian gas deliveries through Ukraine – which is to cease after the current transit agreement expires at the end of December 2024 - and the TurkStream pipeline. The Outlook also explores the implications of a full Russian pipeline supply cut-off, with a particular focus on the impact of additional gas demand from Moldova. (5) ACER underlines the importance of the following findings by ENTSOG: a. High Gas Storage Levels: As of 1 October 2024, the EU gas storage levels had reached 94% of capacity (1,083 TWh), comparable to last year’s level. This high storage level is attributed to reduced gas consumption in recent years, higher storage levels at the beginning of the injection season, and measures taken by EU Member States. b. Early Storage Withdrawals: Early withdrawals could deplete storages by the end of the season, reducing storage flexibility and increasing the risk of demand curtailment, especially during cold spells. In response, some countries have opted to reserve part of their gas stocks as strategic reserves. c. Summer Storage Targets: Looking ahead to the 2025 summer storage targets, maintaining storages at around 30-40% capacity at the start of the next injection remains important as this would facilitate replenishing storages during the summer period and meeting the 90% storage target by the end of the summer. d. Reduced Reliance on Russian Gas: The EU’s increased independence from Russian gas is illustrated by the fact that the EU could maintain 40% storage levels at the end of the winter even without any Russian pipeline gas. e. Ukrainian Storage Options: Additionally, ENTSOG analysed the potential benefits of utilising Ukrainian gas storage facilities to provide further flexibility between Member States, especially in Central and Southeast Europe. f. Mitigating Full Supply Disruptions: ENTSOG’s simulations suggest that, in the event of a full supply disruption, such as a complete cut-off from Russian pipeline supplies combined with limited LNG availability during a cold winter, a combination of extra supplies and a 15% reduction in gas demand would be needed to avoid demand curtailment risks and maintain adequate storage levels. g. LNG and Norwegian Gas: ENTSOG underlines the growing importance of LNG and Norwegian gas, which now have become the primary sources of natural gas for EU Member States and the Energy Communities’ Contracting parties.

text: 3. ASSESSMENT OF ENTSOG ASSUMPTIONS

text: (6) ACER appreciates the relevance of the methodology that ENTSOG has been using in recent years for analysing the historical gas supply, demand patterns and use of storages, as well as the possible evolution of storage levels for the upcoming winter and summer resulting from the assumptions and simulations contained in the Outlook. (7) Nevertheless, by analysing the assumptions and methodology applied, this opinion proposes some recommendations to further improve the Outlook.

text: Gas storage assumptions

text: (8) On 1 October 2024, the starting point of the outlook simulations, the storage filling level reached 94% of the total EU-27 + UK storage capacity, well above the 90% filling target. (9) ACER welcomes that in recent Outlooks, ENTSOG has improved gas storage assumptions, e.g. by considering the strategic reserves for storages set out by each country’s specific regulations , including the Ukrainian storage in ENTSOG’s model as a last resort node , and the role of tanks from LNG regasification terminals to offer additional short-term storage flexibility. (10) While gas prices are currently not factored into ENTSOG’s modelling, summer-winter price spreads signal possible challenges for market-based storage filling. (11)

text: Recommendation 1: Therefore, ACER recommends including a qualitative analysis of gas wholesale futures prices (e.g. on TTF) and expected summer-winter price spreads, as negative and close to zero summer-winter spreads could cause challenges for market-based filling of gas storages even in the absence of infrastructure bottlenecks.

text: (12) ACER supports ENTSOG’s view that a 32% aspirational target for storage filling level on 1 April 2025 will be needed to ease storage injections during the summer and ensure preparedness for the upcoming winter 2025/26.

text: Supply assumptions

text: (13) ACER emphasises that the conclusions of the Outlook should be interpreted within the context of ENTSOG’s gas supply assumptions, which are based on historic supply data (Caspian Sea, Algeria, Reference LNG), TSO information (Libya, Norway) or observed flows from the last two years (Russia).

text: (14) ACER welcomes that the Outlook also considers Moldova in the non-EU countries that are included in the modelling perimeter when assessing the supply adequacy at European level. (15) The assumptions regarding Russian piped gas supply reflect the currently reduced Russian imports, which are limited to routes through Ukraine and TurkStream. As the transit contract of Russian gas via Ukraine will likely cease on 31 December 2024, the Outlook assumes no more Russian pipeline gas from this date through Ukraine. In ACER’s view, ENTSOG has used a reasonable scenario for modelling the potential Russian pipeline gas supply, considering current geopolitical uncertainty . (16)

text: Recommendation 2: ACER restates its recommendation to ENTSOG to consider improving the Outlook assumptions, for example by also considering the expected gas supply via booked capacities , rather than building assumptions only based on historical values.

text: LNG imports and its increasingly important role

text: (17) ENTSOG’s supply assumptions for LNG consider three scenarios: a reference, a low and a high LNG supply scenario . ACER welcomes this approach as the European Union has and will increase its reliance on LNG supply to offset reduced supplies from Russian pipeline gas. This is also in view of the limited additional supply flexibility through other sources of piped gas. (18)

text: Recommendation 3: ACER takes note of ENTSOG’s efforts to consider a “low LNG supply scenario” which simulates a scenario without Russian LNG supplies available to the European Union. ACER encourages ENTSOG to provide further details on the assumptions and methodology used to build this “low LNG supply scenario” without Russian LNG supplies .

text: Infrastructure and capacity assumptions

text: (19) ACER welcomes that the Outlook topology takes stock of four new LNG infrastructure projects . However, ACER would encourage to provide more granular information linking infrastructure and capacity assumptions. (20)

text: Recommendation 4: ACER encourages ENTSOG to provide more clarity on the monthly capacities added by new projects including, for example, via additional LNG import or cross-border capacities. Furthermore, ACER would welcome the provision of a complete list of all infrastructure and capacities considered in the assessment, similarly to what is published in each TYNDP . (21) ENTSOG’s simulations are under the assumption of efficient cooperation between the countries to share available gas volumes, including gas in storage, to avoid curtailment. (22)

text: Recommendation 5: ACER welcomes the assumption of efficient cooperation among countries and reiterates the relevance of including a sensitivity without efficient cooperation to ENTSOG. Such sensitivity would highlight the added value of Member States’ cooperation to deal with situations of tight gas supply.

text: Demand assumptions

text: Seasonal Demand

text: (23) On 25 March 2024, the Council adopted a recommendation that encourages Member States to continue reducing their gas consumption until 31 March 2025, by at least 15% compared to their average gas consumption in the period from 1 April 2017 to 31 March 2022. This recommendation follows an emergency Council Regulation on gas demand reduction measures adopted in 2022 as an urgent response to the energy crisis caused by Russia’s military aggression against Ukraine.

text: (24) ACER notes that while the "Reference Summer" demand considers the 15% reduction target , the "Reference Winter" demand is calculated differently. The demand for the latter shows a 14.6% increase compared to the winter of 2023/24, while being 8% lower than the average of the reference years 2017/18 – 2021/22.

text: Peak Demand

text: (25) The 2024/25 Outlook simulates “stress tests” of the gas infrastructure under two cases of high demand linked to cold weather, namely under a “Peak day” and a “2-week cold spell”.

text: (26) Overall, ACER finds that the Outlook’s seasonal demand projections could be overly optimistic when compared to historical demand trends , gas demand projections from other institutions, and the observed decrease in gas demand compared to the recent years. (27) As ACER recently noted , gas demand for power generation is highly volatile, influenced by factors such as electricity demand, renewable energy production, gas and coal prices, and weather conditions. ACER emphasises the importance of accurate gas peak demand assumptions to assess the EU gas network resilience to Dunkelflauten periods or extreme cold weather conditions. (28)

text: Recommendation 6: ACER recommends ENTSOG to compare its seasonal demand projections with outside sources and historical demand evolution. ACER recommends ENTSOG to review TSOs’ demand estimates for consistency at EU level, and how gas prices and political efforts to reduce demand are considered by each TSO.

text: Disruption scenarios and risk factors

text: (29) ACER finds that the Outlook’s frame of reference, reflecting the currently reduced Russian imports limited to Ukraine and TurkStream routes to the EU, is adequate. In addition, ACER welcomes that ENTSOG includes a full gas supply disruption of the pipelines from Russia, investigating its potential impact on the storage filling level at the end of the winter and gas demand curtailment, for both the “Reference Winter” and “Cold Winter” scenarios.

text: (30) The Outlook’s simulations show that, under a disruption of Russian gas flows in case of a “Cold Winter”, storages cannot reach the 30% filling level at the end of the winter season, and that in most scenarios European countries would need to implement a cooperative sharing of demand curtailment. (31) ACER would find it useful to analyse a scenario whereby a full disruption of Russian gas supply could be aggravated by additional disruptions (e.g., gas supplies from

text: Algeria, prolonged disruption of Norwegian gas supplies via offshore pipelines). Although additional disruptions are overall less likely to occur, such analysis would provide useful insights regarding the readiness of the European gas infrastructure to deal with an unlikely but high impact disruption scenario.

text: Risk factors for the upcoming winter

text: (32) In addition to the likely stop of Russian gas transit flows via Ukraine from 1 January 2025, ACER lists here for information purposes risk factors that are relevant for the upcoming winter and summer seasons. ACER consistently invites ENTSOG to be more comprehensive in listing the various risks in future Outlooks as it is important for Member States and stakeholders to be aware of them: a. A colder than usual winter, driving up gas demand; b. A lack of implementation of gas demand reduction recommendations; c. Increased demand volatility of gas power plants; d. Increase in Asian gas demand, possibly driving upwards global LNG demand and prices; e. A low storage filling level at the end of winter, limiting the deliverability of storages and complicating the replenishment of storages during summer 2025; f. Operational incidents or accidents in major supply routes, upstream production sites or major LNG liquefaction terminals limiting gas supply; and g. Rising tensions in the Middle East create an upside risk via a direct risk to LNG flows and an impact of rising crude prices.

text: 4. CONCLUSION

text: (33) Based on the foregoing assessment, ACER welcomes ENTSOG’s continuous effort to deliver the Outlook on time, assessing the main risks for gas supply, the recommendations to mitigate associated risks and the implementation of some methodological advancements . Additionally, ACER encourages ENTSOG to make further methodological improvements in upcoming Outlooks, as outlined in the Recommendations 1-6 of Chapter 3 to this Opinion. ACER recommends including a summary of main changes in assumptions and methodologies in each Outlook to inform on advancements made in light of ACER’s preceding recommendations. Finally, ACER reiterates the importance of continuing ENTSOG’s and the European Network of Transmission System Operators for Electricity’s (ENTSO-E) exchange of data and results used for the seasonal gas and electricity outlooks, and the appropriate consideration of gas and electricity interlinkages in the Outlooks,

text: HAS ADOPTED THIS OPINION:

text: 1. ACER finds that ENTSOG’s Winter Supply Outlook 2024/25 is broadly consistent with the objectives listed in 4(3)(b) of

text: Regulation (EU) 2019/942

text: and

text: Regulation (EU) No 2024/1789

text: . 2. Future seasonal Outlooks should appropriately take into account ACER’s comments and recommendations as provided in this Opinion. This Opinion is addressed to ENTSOG. Done at Ljubljana, on 18 December 2024.

text: - SIGNED –

text: Fоr the Agency The Director

text: C. ZINGLERSEN

type: vagledning

utgivare: acer