text: OJ L158, 14.6.2019, p. 22. 2 OJ L 158, 14.6.2019, p.92 and 94.

text: Opinion No 03/2023

text: Refers to

text: Regulation (EU) No 347/2013

text: , which was repealed by

text: Regulation (EU) No 2022/869

text: 4 OJ L 158, 14.6.2019, p. 168-169 and p. 174-175.

text: Opinion No 03/2023

text: The Agency’s Opinion No 06/2022 on key elements of ENTSO-E and ENTSOG draft TYNDP 2022 Scenario Report is available here: https://www.acer.europa.eu/sites/default/files/documents/Official_documents/Acts_of_the_Agency/Opinions/ Opinions/ACER%20Opinion%2006-2022%20on%20draft%20TYNDP%202022%20Scenario%20Report.pdf 6 The TYNDP Inclusion Guidelines are available here: https://eepublicdownloads.blob.core.windows.net/publiccdn-container/tyndp-documents/TYNDP2022/210818_TYNDP2022_GuidanceforPromoters_final.pdf Page 3 of 25

text: Opinion No 03/2023

text: rd 8 c. The ENTSO-E draft 3 CBA methodology .

text: https://2022.entsos-tyndp-scenarios.eu/ 8 The ENTSO-E draft 3rd guideline for CBA (latest version submitted to EC on 27.10.2022) is available here: https://eepublicdownloads.blob.core.windows.net/public-cdn-container/tyndp-documents/CBA/221019- 3rd%20CBA_Guidelines%20.pdf rd The Agency’s Opinion No 03/2020 on the ENTSO-E draft 3 guideline for CBA is available here: https://acer.europa.eu/Official_documents/Acts_of_the_Agency/Opinions/Opinions/ACER%20Opinion%2003 -2020%20on%20ENTSO-E%20Guideline%20for%20cost%20benefit%20analysis.pdf

text: Opinion No 03/2023

text: According to ENTSO-E TYNDP 2022 – Stakeholders Engagement Report (p.9), it appears that such data used can be accessible by any interested stakeholders upon request. This approach allows any other party to carry out analytical work using this data, in line with ACER’s former recommendation. 10 I.e. that the cost data should be provided at the value of the year of the TYNDP, currently 2022, and not at the commissioning year, as well as the inclusion of the clarification that the cost for the purchase of energy should not be included in the OPEX of storage projects.

text: Opinion No 03/2023

text: Mainly by using a Root Mean Square Error indicator of the flow of all the lines that make up the equivalent link.

text: Opinion No 03/2023

text: Opinion No 03/2023

text: https://eepublicdownloads.azureedge.net/clean-documents/Publications/ENTSO- E%20general%20publications/201022_ENTSO-E_AWP_2021.pdf

text: Opinion No 03/2023

text: rd c. Use of scenarios for the cost benefit analyses: According to section 2.2 of the 3 CBA methodology, the analysis should cover multiple scenarios and time horizons, at least one for the mid-term horizon and one for the long-term and very long-term horizon. Despite the above stipulations, and the fact that three scenarios were prepared for each of the two study horizons, i.e. for the years 2030 and 2040, there was a considerable reduction of the scope of the CBA analyses in the TYNDP 2022 edition. More specifically, for the 2030 horizon a full implementation of the CBA methodology was only conducted for one scenario (for NT 2030), while for scenario DE 2030 the quantities of losses were not calculated, and there were no analyses for GA 2030. For the 2040 horizon the analysis was limited to DE 2040 scenario, and only for indicator B1 (and the sub-indicators B2 and B3), limiting the visibility of the projects’ benefits over a longer horizon.

text: Also, for the “gas price sensitivity” DE 2030, only indicator B1 (and sub-indicators B2 and B3) were calculated. 15 Market and network models simulations with the project under examination either added to the reference grid or removed from it, are compared to the reference grid situation to calculate the various benefits of the project. 16 Appendix 1 of the SNS-IG 17 Annex II of the IG 18 Section 3.1 of the SNS-IG 19 Section 2.5 of the IG

text: Opinion No 03/2023

text: Project 228 - Muhlbach – Eichstetten in status “Planned but not yet in permitting”, project 378 – Transformer Gatica in status “Planned but not yet in permitting” and project 379 – Transformer Gatica in status “Planned but not yet in permitting”.

text: Project 183 – DKW-DE Westcoast with phase “In permitting”, project 200 – CZ Northwest-South corridor with a phase “In permitting”, project 230 – Gerpol power bridge I with phase “In permitting” regarding investment item 355,project 254 - HVDC Ultranet Osterath to Philippsburg with phase “In permitting” and project 313 - Isar/Altheim/Ottenhofen (DE) - St.Peter (AT) with phase “In permitting”. 22 Project 13 - Baza project, project 134 - North-South Corridor in Western Germany (section South), Project 135 N-S Western DE parallel line, project 191 - OWP TenneT Northsea Part 2, project 209 - Reinforcement Northeastern DE, project 255 - Connection Navarra-Basque Country and project 337 - Conneforde-Merzen. 23 Project 170 - Baltic States Synchronization with Continental Europe, project 207 – Reinforcement Northwestern DE and project 350 – South Balkan Corridor. 24 Project 126 - SE North-south short-term reinforcements with a commissioning date 2035, 25 Project 134 - North-South Corridor in Western Germany (section South), Project 135 N-S Western DE parallel line, project 191 - OWP TenneT Northsea Part 2, project 209 - Reinforcement Northeastern DE, project 255 - Connection Navarra-Basque Country and project 337 - Conneforde-Merzen. 26 Project 124 – NordBald phase 2 with commissioning date 2026

text: Opinion No 03/2023

text: rd IG in conjunction with the stipulations of p. 27 of the 3 CBA methodology, only projects being at least in “planned but not yet in permitting” phase and having a commissioning date by 2038 can be part of the 2040 reference grid. Despite the above criteria set in the IG, there are six projects included in the reference grid with an indicated status “under consideration”, and for six projects which are not included in the TYNDP 2022, neither were included in the TYNDP 2020, there is no information whether they fulfil the set criteria or not.  For 17 projects which are included in the starting grid but seem to be missing from the reference grid lists, ENTSO-E clarified after the TYNDP submission that they were considered as part of the reference grids for the CBA assessment.

text: Project 243 - New 400 kV interconnection line between Serbia and Croatia, project 280 - FR-BE: study Lonny- Achene-Gramme, project 377 - Upgrade BE-NL interconnector VanEyck-Maasbracht, project 1074 – Pannonian corridor, project 1119 - Bisamberg (AT) - Wien SO (AT) - Parndorf (AT), project 1120 - Wien SO (AT) – Ternitz (AT) – Hessenberg (AT) 28 These are the same projects mentioned in footnote 20. 29 Projects 13, 21, 48, 62, 75, 77, 78, 172, 173, 203, 208, 236, 245, 251, 262, 269 and 320 30 While it is stated in IG (p.18) that “For deltaNTC calculations, only one market output for a given climate year will be used,” and that “additional modelling information on NTC will be given in a separate document to be published with the TYNDP 2022 package later in the process,” the Agency is not aware of any such document.

text: Opinion No 03/2023

text: Page 11 and 12 of ENTSO-E TYNDP 2022 Stakeholders Engagement Report, https://eepublicdownloads.blob.core.windows.net/public-cdn-container/tyndp-documents/TYNDP2022/ACERopinion/stakeholders-engagement-report.pdf 32 96 investment items included in the TYNDP 2020, are missing from the draft TYNDP 2022

text: Opinion No 03/2023

text: https://ec.europa.eu/commission/presscorner/detail/en/ip_22_3131 34 According to Appendix 3 of the SNS-IG “Cost assumptions are theoretical assumptions that include the assumed costs of reinforcement of internal networks that would be necessary for the cross-border capacity increases”

text: Opinion No 03/2023

text: https://acer.europa.eu/Official_documents/Acts_of_the_Agency/Opinions/Opinions/ACER%20Opinion%2003 -2021%20on%20the%20methodological%20aspects%20of%20the%20ENTSO- E%20draft%20TYNDP%202020.pdf 36 https://www.acer.europa.eu/sites/default/files/documents/Official_documents/Acts_of_the_Agency/Framewor k_Guidelines/Framework%20Guidelines/FG_For_Joint_TYNDP_Scenarios.pdf

text: Opinion No 03/2023

text: I.e. Opinion No. 11/2019 on the draft ENTSO-E TYNDP 2018 and Opinion No. 03/2021 on the draft ENTSO- E TYNDP 2020 Page 15 of 25

text: Opinion No 03/2023

text: The existing (year 2022) winter peak capacity on the IT-AT border is 325 MW. If we add 300 MW plus 90MW, which are the capacity increases expected to be incurred by 2023 with the commissioning of projects 26 and 336 listed in Appendix I to the SNS-IG, respectively, the capacity of the starting grid is expected to reach 715MW. 39 Energy Not Served

text: Opinion No 03/2023

text: OJ L 152, 3.6.2022, p. 97 41 OJ L 152, 3.6.2022, p. 72-74 42 https://eepublicdownloads.azureedge.net/tyndp-documents/ILM%20Investigation%20Document.pdf

text: Opinion No 03/2023

text: Opinion No 03/2023

text: The capacities of the “current grid” are meant as the capacities of the “starting grid” for the purpose of needs identification minus the capacities of future projects included in the starting grid, as listed in Appendix I to the System Needs Study Implementation Guidelines. The timestamp depends on actual assumptions used by ENTSO-E. For the future, it could be 31 December of the year before the TYNDP.

text: Opinion No 03/2023

text: By providing more information on the selection of the critical branches / critical outages, clarifications on the selected climatic year, and by making available within the TYNDP package full details on the power or load shift applied, especially for the projects of third party promoters.

text: Opinion No 03/2023

text: th Regarding the scenario used for the needs exercise, the Agency notes that Recital 31, 6 the single scenario used for the needs exercise is a step backwards bullet compared to the needs identification for the TYNDP 2018, when needs were identified for all available scenarios.

text: st The exercise for 2030 and 2040 was performed using different definitions Recital 31 (1 of zones (NTC model for 2030 and zonal model for 2040), resulting in bullet) incomparable outcomes. The consistency and comparability of the results should be ensured in the future, e.g. by using the same definition of zones for all study horizons for the needs exercise, as well as with the CBA exercise th More transparency is needed regarding the assumed costs. Uncertainty Recital 31 (4 remains regarding the estimation of the project costs in the case of non- bullet) mature projects, and in which cases the indicated costs include the assumed costs of reinforcement of internal networks that would be necessary for the cross-border capacity increases. For the future TYNDPs, ENTSO-E should set up principles on how to construct the costs used in the needs exercise, and provide further information on how the values were derived. The main features and differences of the different market monitoring tools Recital 33 (for TYNDP 2022: Antares, APG Tool, BID3, Plexos, PowerSym and Plexos) along with potential impact on the calculated benefits and the modelling assumptions considered in the various tools are not presented.

text: Opinion No 03/2023

text: Opinion No 03/2023

text: Page 53 in the IG of TYNDP 2022 46 Page 55 in the IG of TYNDP 2022 47 Page 68 in the IG of TYNDP 2022 48 The text is slightly changed in the IG of TYNDP 2022 (without changing the Agency’s remark) as follows: “To properly model the loss of load probabilities, the hazards must be simulated in detail. This is achieved through a Monte Carlo analysis, requiring a large number of years to be modelled in order to reach the convergence of the outputs. Consequently, for the TYNDP, adequacy simulations must be performed with 525 Monte Carlo years, resulting from the matching of the full set of the 35 PECD climate years and 15 outage patterns time series.”

text: Opinion No 03/2023

text: Pages 71-72 in the IG of TYNDP 2022 50 The thresholds were €1.4mil and €14 mil in the IG of TYNDP 2022 51 Pages 74-75 in the IG of TYNDP 2022 52 In TYNDP 2022 only 5 storage projects provided a calculation for B8.2 indicator (Black start services), and only one out of them was accepted by ENTSO-E. 53 In TYNDP 2022 only 1 transmission project provided a calculation for B8.1 indicator (frequency stability), and was accepted by ENTSO-E.

text: Opinion No 03/2023

text: Indicator B10 in the TYNDP 2020 corresponds to indicator B9 of TYNDP 2022 55 rd Page 104 in the most recent version of the draft 3 CBA methodology, submitted to the Commission in October 2022. 56 rd Section 3.2.5 of the most recent version of the draft 3 CBA Methodology

identifier: ACER Opinion No 03/2023

title: ACER Opinion 03-2023 on the methodological aspects of the ENTSO-E TYNDP 2022

text: PUBLIC

text: OPINION No 03/2023 OF THE EUROPEAN UNION AGENCY FOR THE COOPERATION OF ENERGY REGULATORS of 4 April 2023 on the methodological aspects of the ENTSO-E draft Ten-Year Network Development Plan 2022

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) 2019/943

text: of the European Parliament and of the Council of 5 June 2019 on the internal market for electricity , and, in particular,

text: Article 30(1)

text: (b) and

text: Article 32(2)

text: thereof, Having regard to the outcome of the consultation with the Agency’s Electricity Working Group, Having regard to the favourable opinion of the Board of Regulators of 29 March 2023, delivered pursuant to

text: Article 22(5)

text: (a) of

text: Regulation (EU) 2019/942

text: , Whereas:

text: 1. INTRODUCTION

text: (1) According to

text: Article 30(1)

text: (b) of

text: Regulation (EU) 2019/943

text: , the European Network of Transmission System Operators for Electricity (‘ENTSO-E’) shall adopt and publish a non-binding Union-wide ten-year network development plan (the ‘TYNDP’) biennially.

text: (2) According to

text: Article 48(1) of Regulation (EU) 2019/943

text: , the TYNDP “shall include the modelling of the integrated network, scenario development and an assessment of the resilience of the system. The Union-wide network development plan shall, in particular: (a) build on national investment plans, […]; it shall be subject to a cost-benefit analysis using the methodology established as set out in Article 11 of that Regulation ; (b) regarding cross-border interconnections, also build on the reasonable needs of different system users and integrate long-term commitments from investors referred to in Articles

text: and

text: of Directive (EU) 2019/944 ; and (c) identify investment gaps, in particular

text: with respect to cross-border capacities.”

text: Article 32(2)

text: , first subparagraph, of

text: Regulation (EU) 2019/943

text: requires ENTSO-E to submit the draft TYNDP, including the information regarding the consultation process, to the European Union Agency for the Cooperation of Energy Regulators (‘the Agency’) for its opinion.

text: (4) According to

text: Article 31(1) of Regulation (EU) 2019/943

text: “While preparing the proposals pursuant to the tasks referred to in

text: Article 30(1)

text: , the ENTSO for Electricity shall conduct an extensive consultation process. The consultation process shall be structured in a way to enable the accommodation of stakeholder comments before the final adoption of the proposal and in an open and transparent manner”.

text: Article 32(2)

text: , second subparagraph, of

text: Regulation (EU) 2019/943

text: requires that the Agency provide a duly reasoned opinion as well as recommendations to ENTSO-E and to the Commission where it considers that the draft TYNDP submitted by ENTSO-E does not contribute to non-discrimination, effective competition, the efficient functioning of the market or a sufficient level of cross-border interconnection open to third-party access.

text: (6) Pursuant to

text: Article 4(5) of Regulation (EU) 2019/942

text: , the Agency shall, based on matters of fact, provide a duly reasoned opinion as well as recommendations to ENTSO-E, the European Parliament, the Council and the Commission, where it considers that the draft TYNDP does not contribute to non-discrimination, effective competition and the efficient functioning of the market or a sufficient level of cross-border interconnection open to third-party access, or does not comply with the relevant provisions of

text: Regulation (EU) 2019/943

text: and

text: Directive (EU) 2019/944

text: (7) On 31 January 2023, ENTSO-E submitted the draft TYNDP 2022 to the Agency for its opinion.

text: 2. DOCUMENTS OF THE DRAFT ENTSO-E TYNDP 2022 CONSIDERED FOR THIS OPINION

text: (8) For the purpose of the present Opinion, the Agency considered the following documents within the scope of the draft TYNDP 2022:  The TYNDP 2022 main report.  The TYNDP 2022 Project Sheets.  System Needs Study- Opportunities for a more efficient European power system in 2030 and 2040 (hereafter SNS).  The TYNDP 2022 CBA implementation guideline (hereafter IG).  System Needs Study Implementation Guidelines (hereafter SNS-IG).  Identification of offshore hybrid needs in the TYNDP’s identification of system needs phase – methodology (hereafter Off-Shore Needs Methodology).  The Stakeholders Engagement report.  A table listing all project-level indicators submitted by project promoters and ENTSO- E’s assessment of whether each submission is compliant with the CBA 3.0 Guideline.  The TYNDP 2022 Scenario Report, on which the Agency issued a separate Opinion .  The ENTSO-E document “TYNDP 2022 Guidance for applicants - transmission and storage project promoters - Criteria for applications and their treatment” (hereafter “TYNDP Inclusion Guidelines”) .

text: The draft TYNDP 2022, in addition to the description of the adopted methodologies and their implementation, contains a description and assessment of 141 electricity transmission projects, corresponding to 291 investment items, and 23 electricity storage projects.

text: 3. ASSESSMENT OF THE DRAFT ENTSO-E TYNDP 2022

text: (9) The Agency assessed the draft TYNDP 2022 on the basis of the following main criteria:

text: (10) Furthermore, the Agency took into account its previous opinions, recommendations and positions, particularly those related to:

text: a. The draft TYNDP 2012, draft TYNDP 2014, the draft TYNDP 2016, the draft TYNDP 2018, and the draft TYNDP 2020.

text: b. The scenarios to be used in the draft TYNDP 2022.

text: (11) The Agency acknowledges that the TYNDP process is complex and resource intensive, and needs to be carried out within a two-year timeframe.

text: 3.1 Improvements with respect to the previous TYNDP

text: (12) The Agency acknowledges in particular the following improvements implemented by ENTSO-E: a. Regarding the TYNDP Inclusion Guidelines, they:  provided a single time window (i.e. from 15 September until 15 October 2021) to submit project applications for the TYNDP 2022 and did not discriminate projects providing a different CBA assessment based on the time of submission;  explicitly stated that the project promoters may receive upon request the full TYNDP market and network datasets (after the datasets were available), so that promoters could directly verify their project results ; rd  remedied some previous misalignments with the ENTSO-E draft 3 CBA methodology ;  Allowed project promoters to receive upon request full TYNDP market and network datasets, so that promoters can directly verify their project results . b. Regarding the process,

text: a public consultation was conducted by ENTSO-E before the implementation of the CBA methodology (30-11-2021 to 7-1-2022). Although most of the comments are intended to be considered for the TYNDP 2024 edition, the consultation constitutes an improvement for the future TYNDP process, under the condition that the comments submitted will be actually considered in the development of the TYNDP 2024. In this consultation the views of stakeholders on five elements of the TYNDP 2022 Implementation Guidelines, and on the approaches to be followed in the TYNDP 2024 were requested; c. Regarding the identification of system needs,

text: significant improvements of the deliverable were noted, especially regarding the following:  transparency on project costs considered in the exercise, the starting capacities considered, and the presentation of results;  a separate starting grid from the ones used for the CBA analysis was used for first time;  the use of three additional climate years in 2030 compared to one climate year for the 2020 TYNDP;  improved grid reduction clustering with the use of quality indicators , especially on the interconnections;  the optimiser minimises also energy-not-served as part of system costs for the 2040 horizon;  the methodology used was presented in detail in a separate technical document, providing a clear list of input data for each time horizon, and the process in the form of diagram;  better presentation of results (online data platform providing results per country);  the inclusion of maps depicting for first time the borders where planned projects, which are expected to become available until 2030, exceed the identified needs (or can be considered competing). Also maps depicting the borders where the identified needs are not covered by TYNDP projects. rd d. Regarding the CBA assessment and the implementation of the 3 CBA methodology, the Agency welcomes:  the increased geographic perimeter considered for the market model by including the following non-member countries of ENTSO-E: Algeria, Egypt, Libya, Morocco, Moldavia, Malta, Palestine, UK, and Turkey;  the improved transparency of the CBA assessment by including in the IG document more information on the assumptions used on the implementation rd of the 3 CBA methodology, e.g. an appendix on CO2 emissions per generation type, and more information on the projects included in the reference grids 2030 and 2040;

text:  the deletion of the (former) indicator B9 - Avoidance of renewal/replacement cost of infrastructure;  the improved structure, readability and user-friendliness of the project sheets, and the inclusion of more information, providing more clarity on the CBA assessment, e.g. the introduction of a project's TYNDP history, the inclusion of reference to the investment item number in their description, the distinction between the inception and sustaining CAPEX;

text: 3.2 Remarks of Stakeholders provided during the consultation process

text: (13) The comments collected during the consultation process of ENTSO-E, which are presented in the Stakeholders Engagement report, in many instances indicate important topics which ENTSO-E should seriously consider to improve the process and the quality of the TYNDP deliverables. In the Agency’s view the following remarks are the most noteworthy to be considered by ENTSO-E:  The role of DSOs in shaping the energy sector should be considered  The issue of climate change and the need to consider the evolving climatic conditions in the future demand and generation patterns, instead of using only historic data, as well the consequences of the changing climatic condition to elements of the system planning.  The need the 70% target requirement of Art. 16 (8) of

text: Regulation (EU) 2019/943

text: to be taken into account in determining cross-border exchanges.  The need for a more substantial consultation: various stakeholders request that ENTSO-E consults all data and methodologies to ensure transparency, e.g. installed capacities, interconnection capacities, hydro inflows, fuel prices, demand, RES time series and technologies.  Various improvements to increase the transparency of the process are highlighted:

text: o publication of the methodology for the selection of climate years, as well as of the choice to use of 3 climate years and diverse weights to account for their outcomes; o publication of the internal reinforcement costs associated to each project; o justification of the choice of 15 random outage patterns (for the calculation of the adequacy); o justification of the choice of value of lost load;

text: o make the outcomes of the CBA transparent, so stakeholders can properly react to them.

text:  The need for ENTSO-E to assess the commissioning year indicated by promoters (to reflect the commissioning delays observed in the Agency’s PCI monitoring report).

text:  On redispatch calculations, as well as indicators B7 (SoS Flexibility) and B8 (SoS System Stability), many stakeholders express the view that these indicators should be calculated centrally by ENTSO-E and in a transparent way due to their complexities.

text: 3.3 Key remarks on the TYNDP package

text: (14) In the Agency’s view, a significant improvement is noted regarding the 2022 needs identification study (SNS and SNS-IG documents). However, there are still areas where significant improvement is needed regarding the overall process, as well as specific methodological elements. In the Agency’s view the following areas are of the most importance for the improvement of the quality of the TYNDP.

text: a. Timing and content of the TYNDP consultations: ENTSO-E hosted several public workshops on the development of the TYNDP to consult the associated documents and results. However, the timing of the consultation of the deliverables came after they were completed and pertained to the results of the studies and not to the assumptions and approaches to be adopted, which could have had a significant impact on the outcomes of the studies. More specifically, as mentioned in page 49 of the SNS, “Most comments, including those regarding the methodology itself will be taken into account in the development of the next edition of the System needs study, because time does not allow to re-run the study". Regarding the IG document, which includes the main assumptions and choices made for the CBA assessment, although some main elements were consulted before the start of the CBA calculations, only five of the consulted questioned pertained to the TYNDP 2022 edition. Furthermore, it is unclear whether the comments received had any impact on the draft TYNDP 2022, while the majority of the questions, according to ENTSO-E were intended to be considered for future TYNDP editions.

text: b. Development timeline of the TYNDP: delay is noted in the delivery of the TYNDP package. More specifically, the 2022 Scenario Report was delayed by four months compared to ENTSO-E’s initial work programme 2021 (April 2021 vs. December 2020), and the submission of the draft TYNDP 2022 to the Agency for

text: its Opinion took place on 31 January 2023, despite the legal requirement for the adoption of the TYNDP every two years.

text: d. Construction and use of the starting and reference grids: Given that the “starting grid” is used as a starting point for the calculation of infrastructure needs, and the “reference grid” is used as counterfactual in the TYNDP CBA for the calculation of project benefits, they have a strong (and potentially distorting) impact on the needs identified and the overall CBA results, respectively. After reviewing the lists 16 17 of projects included in the starting grid and the reference grids used for the TYNDP 2022, the Agency noted that some of these projects either do not meet the criteria set by ENTSO-E in the SNS-IG for the construction of the starting grid and in the IG for the construction of the reference grids or it is ambiguous whether they meet these criteria. On the other hand, some TYNDP 2022 projects that meet the set criteria are not included in the starting or reference grids. More specifically:  Regarding the starting grid, according to p.38 of the IG, “only projects which, at their time of submission to the TYNDP, are in the construction phase or those which have successfully completed the environmental impact assessment

text: can be part of the starting grid”. Despite the above, there are three projects which are still in a “planned but not yet in permitting” status, and therefore do not meet the criterion set in the SNS-IG. Furthermore, there are five projects , in a “permitting” phase, for which there is no reference and/or evidence that they have completed the environmental impact assessment. Also, for seven projects , which are not included in the TYNDP 2022 neither were included in the TYNDP 2020, there is no information whether they fulfil the set criteria or not. On the other hand, three projects which met the criteria for inclusion in the starting grid were left out by ENTSO-E.  Regarding the reference grid for 2030 study horizon, according to p. 38 of the IG, “only projects which, at their time of submission to the TYNDP, are at minimum in “planned but not yet in permitting” phase and have a commissioning date by the end of 2028 can be part of the 2030 reference grid”. Despite the above criteria set in the IG, one project included in the reference grid has an indicated commissioning date beyond 2028, therefore it is not eligible to be part of the reference grid, and for six projects which are not included in the draft TYNDP 2022 neither were included in the TYNDP 2020, there is no information whether they fulfil the set criteria or not. On the other hand, one project which met the criteria for inclusion in the reference grid was left out by ENTSO-E.  Regarding the reference grid for 2040 study horizon, according to p. 38 of the

text: e. Transfer Capability calculations: Contrary to the practice followed in the last TYNDP editions, no ΔNTC calculations were performed by ENTSO-E for the draft TYNDP 2022, endangering the evaluation of benefits due to capacity increases. The draft TYNDP 2022 accepts without verification the capability calculations conducted by the promoters themselves for all projects, raising concerns about the consistency of the presented data. Furthermore, the draft TYNDP 2022 does not provide information on the modelling assumptions used by the project promoters for these calculations (e.g. on the selected climate year(s)) and on the used modelling approaches (e.g. use of year-round simulation or points in time, use of load or generation shifts), despite the clear stipulation of the IG .

text: 3.4 Other remarks

text: 3.4.1 Other remarks on the TYNDP process

text: (15) The Agency has taken note of the concerns raised by some stakeholders regarding the lack of transparency and clarity of input data (mostly concerning scenarios data) and of certain results. It is recommended that ENTSO-E makes all relevant TYNDP 2022 inputs accessible in a clear and easily understandable format as part of the final TYNDP 2022 publication.

text: 3.4.2 Other remarks on the TYNDP Guidelines for the inclusion of projects in the TYNDP 2022

text: (16) The Agency acknowledges that the TYNDP Inclusion Guidelines in general ensure the equal treatment of projects and the transparency of the inclusion process as set out in Annex III.2 (5) of

text: Regulation (EU) 2022/869

text: (17) Also, the Agency considers that the TYNDP Inclusion Guidelines can properly serve the objectives of transparency and non-discrimination and eventually improve the quality and credibility of the TYNDP, if they are duly and consistently applied by ENTSO-E and the results of their application are clearly described in the TYNDP.

text: (18) Nevertheless, in the Agency’s view, the comprehensiveness of the TYNDP may be improved, as it is noted that some investments which fall within its scope seem to be missing from the TYNDP, due to the voluntary basis of the candidate projects’ submission. More specifically, these investments are those which were included in the TYNDP 2020, but were not proposed by the project promoters for the draft TYNDP 2022 or investments which are included only in the NDPs, but are claimed by their promoters to have cross-zonal relevance. Therefore, the identification of projects should be revised to include all projects of cross-zonal relevance in the future TYNDPs.

text: (19) Additional considerations with regard to individual project (including their divergence from the TYNDP Inclusion Guidelines) and additional recommendations are provided in ACER Opinion 04/2023 on electricity projects in the draft ENTSO-E TYNDP 2022 and in the NDPs.

text: 3.4.3 Other remarks on the TYNDP scenarios and their use for cost benefit analyses

text: (20) The ENTSOs published their draft scenario report on 11 April, 2022. On 15 July, the Agency published its Opinion on key elements of ENTSO-E and ENTSOG draft TYNDP 2022 Scenario Report. In this Opinion, the Agency noted urgent improvements to be

text: made by the ENTSOs in light of the Russian aggression on Ukraine. Specifically, the Agency called on ENTSO-E to develop at least one scenario to amend the gas prices considered and as far as possible update the RES integration levels according to the new policies.

text: (21) Following the above recommendations, ENTSO-E conducted a sensitivity analysis of a higher gas price on the DE2030 scenario. In this sensitivity analysis, the increased RES integration levels according to the REPowerEU policy update were not considered, limiting considerably the relevance of the results. The Agency considers that the lack of trust in TYNDP 2022 scenario assumptions makes the TYNDP analysis of limited value.

text: 3.4.4 Remarks on the identification of infrastructure investment needs

text: (22) The Agency notes that, similarly to the previous TYNDP edition, the following remarks are still pertinent:

text:  the needs identification was based on only one scenario (i.e. the National Trends scenario), while it should be applied to all scenarios;

text:  although the Agency acknowledges the challenges incurred when using a more detailed grid model, in the Agency’s view the approach to use different models for the 2030 and 2040 study horizons (i.e. a more detailed zonal model for 2030 and NTC model for 2040) does not promote the consistency and comparability of the results; in this respect the Agency suggests that ENTSO-E should evaluate the evolution towards a fully nodal modelling for future TYNDP infrastructure gaps reports;

text:  uncertainty remains regarding the estimation of the project costs in the case of conceptual projects, as well as in which cases the costs indicated in Appendix 2 of the SNS-IG include assumed costs of reinforcement of internal networks (that would be necessary for the cross-border capacity increases) ;

text: (23) The Agency reiterates its view expressed in its Opinion 3/2021 regarding the following issues (detailed information on these remarks and recommendations is provided in Annex I):

text:  on the importance that needs are identified for all TYNDP scenarios;

text:  on the need to use the same definition of zones for all study horizons for the needs exercise, as well as for the CBA exercise;

text:  on the need for ENTSO-E to set up principles about the calculation of the costs used in the needs exercise, and to provide transparency on how the values were derived, by distinguishing the costs for internal reinforcements from the overall project cost.

text: (24) Furthermore, the Agency notes the following additional remarks:

text:  Storage and CO2-free peaking units were included in the list of investment candidates of the needs exercise, for the first time in TYNDP 2022. The Agency notes that according to recital 24 of the Framework Guidelines for the joint TYNDP scenarios to be developed by ENTSO for Electricity and ENTSO for Gas , the flexibility options are expected to be defined in the joint TYNDP scenarios, based on the targets included in the NECPs. Therefore, including storage and other flexibility solutions in the optimisation to be performed under the needs identification exercise could produce results, which may not be compatible with the national assumptions set in the NECPs or updated later for these solutions. Therefore, the Agency believes that the needs exercise should focus on identifying the infrastructure gaps, by optimising transmission candidates only and by considering the flexibility options (like storage and peaking units) as they are determined in the joint TYNDP scenarios. Additionally, it is not clear from SNS-IG how these storage and peaking units were identified and localised.  The needs exercise currently provides grid optimisation only at the borders of countries, while optimisation also at country internal boundaries between zones should be performed as in input for the TSOs planning tasks.

text:  Although the starting grid transfer capacities are presented in Appendix 1 of the SNS-IG, the storage starting capacities per country (i.e. storage considered in 2025) are not presented and should be included in the final version of TYNDP 2022 after Agency’s opinion.

text: 3.4.5 Other remarks on the calculation of costs and benefits (25) The Agency reiterates its views expressed in the previous opinions regarding the following modelling issues, specific benefit indicators, sensitivity analyses and the calculation of an investment value (detailed information on these remarks and recommendations is provided in Annex I):  market modelling tools used;  the calculations of the transfer capability;  comparison between AC and DC power flow analysis;  the consideration of the impact of the 70% target requirement of Art. 16 (8) of

text: Regulation (EU) 2019/943

text: ;  indicator B1 (SEW) and of sub-indictors B1-RES and B1-CO2;  indicator B5 (Variation in losses);  indicator B6 (Security of supply: adequacy to meet demand);  indicator B7 (Security of supply - flexibility), and especially B7.1 - Balancing energy exchange;  indicator B8 (Security of supply – system stability);  indicator B9 (Reserves for re-dispatch power plants);  sensitivity analyses;  calculation of the value of an investment by combining the project’s costs and benefits, i.e. the Net Present Value (NPV) and the Benefit to Cost Ratio (BCR) indicators. (26) Furthermore, the Agency notes the following additional remarks:  The information provided for the capacities considered for building the starting grid for the needs and the reference grid for the CBA implementation is not clear. In

text: particular, in page 12 of the System needs Report it is mentioned “The grid model to be used as base case for IoSN 2030 of TYNDP 2022 is built from the grid model of TYNDP 2020, which came with 2027 MAF NTCs used as a starting point. Several projects have then to be disconnected in order to reach the grid corresponding to the reference base case NTCs for the scenario NT2030 (MAF 2025 NTCs)”. However, after reviewing the capacities displayed in Appendix I of the SNS-IG the Agency notes that at least for some instances the displayed capacities do not match the data available to the Agency. For example, the IT-AT border capacity (in the starting grid) displayed in figure 0.3 of the SNS is 800 MW, which is higher than the expected 715 MW ); furthermore, the year-averaged NTC in the direction AT-IT would be expected to be slightly lower than the 660 MW year-averaged NTC assumed in the direction SI-IT. Also, it is not clear whether NTCs differentiated by direction were used in the modelling. Last, the cross-zonal capacities internal to a country are not visible in the starting grid. Therefore, more transparency is necessary on the capacities considered for the current grid, the starting grid and the reference grid. In particular, the starting grid capacities should be built based on currently available transfer capacity, plus capacity increases of projects which are certain to be built, minus capacity reductions of projects to be dismissed, to reduce risks of incorporating misalignments from former TYNDP assumptions.  Transparency of the information regarding the use of the market modelling tools further decreased, as the draft EU TYNDP no longer provides the per-project list of specific tools used.  It is unclear what is the Value of Lost Load used in the market models, as there are conflicting references in the IG. In p.70 of the IG it is mentioned regarding the monetisation of indicator B6 “For countries where it is not yet available, the VoLL will be based on expert judgement at 10 k€/MWh for the monetisation of B6 indicator, in line with common values found in the literature”. However, in p.2 of the IG it is mentioned that “The VoLL used in the market models has been updated from 10.000 to 3.000 EUR/MWh. Due to very high ENS in the market models, it is proposed to lower the VoLL to 3.000 EUR/MWh to solve some of the ENS”. However, the Agency notes that the latter statement seems unreasonable, as underestimating the ENS-related problems is not a solution to them.

text:  It is unclear whether an assessment of the resilience of the system, as stipulated in in

text: was performed. Furthermore, it is unclear whether and how changes in climate related extreme weather events and their impact on infrastructure resilience were taken into account when calculating adequacy, as stipulated in Annex IV (3)(c) of

text: Regulation (EU) 2022/869

text: 3.4.6 Other remarks on the Interlinked Model progress

text: Article 11 of Regulation (EU) 2022/869

text: states that by 24th June 2025 ENTSO-E and ENTSOG have to develop a consistent and progressively integrated model (hereinafter “Interlinked Model”). The Regulation also prescribes that this model shall cover at least the relevant sectors’ interlinkages at all stages of infrastructure planning, specifically scenarios, technologies and spatial resolution, infrastructure gaps identification in particular with respect to cross-border capacities, and projects assessment.

text: (28) In May 2021, ENTSO-E and ENTSOG published a progress report on the Interlinked Model joint development. That report introduces the concept of dual assessment and joint assessment for projects submitted to the respective TYNDPs.

text: (29) The Agency appreciates the efforts of ENTSO-E and ENTSOG to implement a common screening and a dual assessment methodology as part of the Interlinked Model. However, the Agency highlights that, practically, the Interlinked Model included in the TYNDP is still primarily limited to the joint TYNDP scenario exercise. The Agency regrets that the dual assessment methodology of the needs identification and projects’ assessment described in the Interlinked Model progress report is not yet planned by the ENTSOs.

text: (30) Given the legal deadlines outlined in

text: Regulation (EU) 2022/869

text: , and the fact that at scenarios level the work for TYNDP 2024 has already started, the Agency is concerned about the timely implementation of the Interlinked Model and calls on ENTSO-E and ENTSOG to continue their work and expand it to the full scope that is envisaged by

text: Regulation (EU) 2022/869

text: and to involve early in the process all relevant stakeholders.

text: HAS ADOPTED THIS OPINION:

text: 1. The Agency finds that the draft TYNDP 2022 assessments and the projects included in it generally contribute to the objectives of non-discrimination, and effective competition, referred to in

text: Article 32(2) of Regulation (EU) 2019/943

text: 2. However, the Agency finds that the draft TYNDP 2022 does not sufficiently contribute to the efficient functioning of the market, and secure functioning of the internal electricity market mainly due to the following shortcomings presented in more details in section 3.3 above:

text: a. Insufficient and untimely consultations of the main methodological elements of the TYNDP package, i.e. the scenarios methodology, the needs methodology and the implementation of the CBA methodology.

text: b. Delays to the delivery of the draft TYNDP 2022 resulting in out-of-date data and calculations results at the time of their publication, and causing delays to the PCI selection process.

text: c. Insufficient scope of CBA analysis, focusing on the 2030 study year, and mainly on one scenario.

text: d. The starting grid, used as a starting point for the calculation of infrastructure needs, and the reference grids, used as counterfactual in the TYNDP CBA for the calculation of the project benefits, are not fully in line with the criteria set for them by ENTSO-E.

text: e. Inconsistent data regarding the transfer capabilities

text: 3. In addition, the Agency is not able to assess whether the draft TYNDP 2022 complies with the requirement of

text: to include an assessment of the resilience of the system and with the requirement of Annex IV (3)(c) of

text: Regulation (EU) 2022/869

text: to include an evaluation of the impact of individual projects in terms of resilience against extreme weather events and climate change impacts.

text: 4. Based on the remarks presented in the preamble to this Opinion, the Agency considers that ENTSO-E should enhance the draft TYNDP 2022 by implementing the following recommendations:

text: a. ENTSO-E should make all relevant TYNDP 2022 inputs accessible in a clear and easily understandable format as part of the final TYNDP 2022 publication.

text: b. ENTSO-E should provide transparency on how the investment costs for the needs identification were derived, by distinguishing the costs for internal reinforcements from the overall project cost.

text: c. ENTSO-E should publish a spreadsheet displaying for each cross-zonal boundary and per each flow direction:

text:  the transfer capacity of the “current grid”, indicating its timestamp ;

text:  the transfer capacity of the “starting grid” for the purpose of needs identification;

text:  the transfer capacity of the “reference grid” for 2030 and for 2040.

text: d. Without prejudice to a more accurate assessment of Value of Lost Load in future TYNDPs, ENTSO-E should use the 10.000 Euro/MWh VOLL (where no specific data is available) for finalising TYNDP 2022.

text: e. ENTSO-E should explain how an assessment of resilience, if any, was carried out in the TYNDP 2022 (potentially including improvements for future TYNDPs).

text: 5. In view of the foregoing, the Agency considers that ENTSO-E should enhance the future TYNDPs by implementing the following main recommendations:

text: a. A substantial consultation of the important methodological elements and parameters considered in the various deliverables of the TYNDP (including the horizons to be studied, the zonal and nodal modelling, the climatic data to be used, and the scope of the CBA benefits assessed) should be conducted early enough in the process in order to enable taking into account stakeholders comments.

text: b. The TYNDP development process should be restructured in order to be completed (including taking into consideration the Agency’s opinion) by December of the year of the TYNDP.

text: c. The benefits of projects should be calculated according to all the joint scenarios developed by ENTSOs, and for all relevant time horizons to ensure adequate consideration of uncertainty.

text: d. The modelling of the grid should be based and on an appropriate starting grid (for the needs exercise) and reference grids (for the CBA assessments) by including only

text: the projects which strictly comply with the rules set in the respective implementation guidelines.

text: e. The additional transfer capabilities of each project should be calculated by ENTSO- E with more granularity instead of calculating a yearly NTC (e.g. at least seasonal NTCs). Furthermore, ENTSO-E should improve the transparency of the NTC calculations .

text: f. The impact of the requirement pursuant to

text: Article 16(8) of Regulation (EU) 2019/943

text: on the internal electricity market must be taken into account by ENTSO- E in the modelling of the power system for the development of the scenarios, the needs identification exercise and the calculation of project benefits, where relevant.

text: g. Last, ENTSO-E should consider for the future TYNDPs the remarks and recommendations provided in section 3.4 of this Opinion.

text: This Opinion is addressed to ENTSO-E.

text: Done at Ljubljana, on 4 April 2023.

text: - SIGNED -

text: Fоr the Agency The Director

text: C. ZINGLERSEN

text: Annex I: Remarks and recommendations included in the Agency’s Opinion 3/2021 on the draft TYNDP 2020 which are still relevant for the draft TYNDP 2022

text: Remark or Recommendation included in the ACER Opinion 3/2021 Recital in Opinion No. 3/2021

text: All scenarios should be used in the CBA analysis in a balanced way Operative part, 4.c

text: ENTSO-E should provide the main features and the differences of the various market modelling tools used together with an assessment of the impact of the modelling options on the estimated benefits.

text: Regarding the network simulations, it is stated in the IG (EU TYNDP 2022: Recital 34 p.16 and 17) that “DC load-flow approximation may also be used for […] losses and NTC calculations”, that “since an AC load-flow for large power

text: systems require typically more iterations to converge towards a solution and higher computation times for calculating Jacobians in each iteration, an AC load-flow exhibits computational limitations.”

text: The EU TYNDP should provide more concrete information (on the computational times and on the performed analysis, including the presentation of the results of both analysis for a selected number of cases) that would facilitate a comparison between AC and DC power flow results.

text: Regarding the calculations of the transfer capability, ENTSO-E should Recital 35 develop specific criteria for the consistent selection of the critical branches / critical outages and make them available in the IG. Also, in case of manual addition or removal of network elements from the CB/CO lists, these changes should be provided within the TYNDP package for transparency reasons.

text: It should also be explained why seasonal NTCs are not calculated, despite the fact that the grid model takes into account seasonality.

text: The wide spectrum of the distribution methods of the generation power shift available for each project raises questions on the consistency of the NTC calculation across projects. ENTSO-E, after assessing each of the available methods, should conclude on the preferred method(s), and in case more than one remains in the proposed ones, the criteria for the method selection should be instructed and not be left at the TSOs’ discretion. Also, the Agency deems necessary for transparency that ENTSO-E should make available full details on the power-shift applied, especially for the projects of third party promoters.

text: Consideration of the impact of the requirement of Art. 16 (8) of Regulation Operative part

text: (EU) 2019/943

text: (regarding the 70% target obligation on the volume of of the opinion, interconnection capacity to be made available to market participants) in the point 4.g modelling of the power system for the development of the scenarios, the needs identification exercise and the calculation of project benefits, where relevant.

text: Regarding the calculation of the indicator B1 (SEW), the calculation of Recital 40.a sub-indicators B1-RES and B1-CO2 and their relation with the total SEW indicator should be clarified. In addition, it is not clarified whether the SEW values calculated for internal projects with an NTC cross-border impact derive by implementing method 2 (i.e. applying re-dispatch simulations

text: without considering the ΔNTC contribution of the project that derives from the market simulation) described in p. 28 of the IG, or method 3 (i.e. applying re-dispatch simulations taking into consideration the ΔNTC contribution of the project that derives from the market simulations) described in p. 30 of the IG. The choice of the method can have an impact on the outcomes of the calculation, and therefore for transparency reasons ENTSO-E should provide this information for each project affected.

text: Regarding the indicator B5 (Variation in losses), ACER welcomes the Recital 40.b partial adoption of the ACER recommendation in its Opinion 03/2020 to simplify the losses monetisation by using (as a second best option) the hourly marginal costs obtained in market simulations. However, it is noted that instead of using the marginal costs of the reference case, as was recommended, the marginal costs of the case with the project s’h,i is used for PINT projects, and the marginal costs of the case without the project sh,i is used for TOOT projects. As this approach could lead to unexpected complexities with some marginal costs, and requires the introduction of caps for each scenario, it is proposed to use the hourly marginal costs regarding the reference case (which ENTSO-E used to indicate to be an adequate system condition). Also, the hourly marginal costs used for the calculations should be published in the TYNDP.

text: Regarding the indicator B6 (Security of supply: adequacy to meet demand), Recital 40.c in p. 41 of the IG it is stated that “In order to properly model the loss of load probabilities, [...] adequacy simulations must be performed with 510 Monte Carlo years, resulting of the matching of the full set of the 34 PECD climate years and 15 outage patterns time series” . Although the definition of the outage patterns can have a significant impact on the outcomes of the

text: adequacy simulations, no information is provided on how the selected 15 outage patterns were selected out of numerous possible patterns.

text: Regarding the indicator B7 (Security of supply - flexibility), and especially Recital 40.d B7.1 - Balancing energy exchange, given the lack of concrete methodology resulting in high uncertainties in the results of its calculation, it is positively noted that this indictor remains qualitative. However, the methodology presented on pages 44-45 of the IG, based on which the “range thresholds” are set to assign the qualitative value (i.e. 0,+,++) to the benefit is not clear, and clarifications should be provided on how the “SEW due to balancing market integration” and the “Long Term + Day Ahead crossborder trade social welfare” are calculated, as well as why the 7,5% ratio was selected, and why the €1mil and €15 mil thresholds were applied to assign the qualitative values to the benefits.

text: Regarding the indicator B8 (Security of supply – system stability), it is Recital 40.e noted that the text on p. 46-47 of the IG […], does not provide further methodology or guidance on how the sub-indicators B8.0, B8.1, B8.2 and B8.3 should have been calculated by promoters. Calculations for this benefit were submitted to ENTSO-E for 7 storage projects (either for frequency stability or black start services) and only for one transmission project (for which, only the black start services part was accepted by ENTSO-E as “compliant with CBA 3”), showing a very low interest, especially by transmission project promoters. ENTSO-E should provide further guidance in the IG of future TYNDPs on how the indicator should be calculated by promoters.

text: Regarding the indicator B10 (Reserves for re-dispatch power plants), Recital 40.g rd 55 according to the 3 CBA methodology, page 91 , it “can only be applied for projects located in countries that have a specific mechanism for contracting redispatch reserve power plants or connecting countries where at least one country has such a mechanism”. However, this limited approach does not safeguard consistency across projects assessed and does not reveal the socio-economic benefit of a project irrespective of whether a specific mechanism for contracting redispatch reserve exists or not. Also, the lack of transparency regarding the projects for which the re-dispatch costs were included in the analysis of indictor B1 entails a risk of double counting benefit with indicator B1. ENTSO-E should calculate this benefit in the future TYNDPs for all countries deemed relevant, and as a result of ENTSO-E’s re-dispatch studies.

text: Although the Agency, in its Opinion No 11/2019 on the draft TYNDP Recital 41 2018, had requested ENTSO-E to identify the most important parameters for sensitivity analyses for the mid-term studies and include these sensitivity analyses in the next TYNDPs, no such identification was performed for the TYNDP 2020, and a sensitivity analysis is missing […]

text: Despite the inclusion in the 3rd CBA Methodology of specific Recital 43 methodology and formulas to calculate the value of an investment by combining the project’s costs and benefits, i.e. the Net Present Value (NPV) and the Benefit to Cost Ratio (BCR) indicators, such indicators are missing from the TYNDP 2020, making it harder for stakeholders to compare (possibly competing) projects.


text: Opinion No 03/2024

text: As the Summer Outlook notes (p.35), the readiness of the gas infrastructure under different scenarios should not be considered as a forecast. The actual gas supply mix and flows will depend on market players’ behaviour. 3 It does not consider gas in form of LNG supplied by Russia. 4 Under a scenario of LNG supplies at the 5-year average level.

text: Opinion No 03/2024

text: E.g. ENTSOG’s supply monitoring dashboards and GIE AGSI+ storage inventory platform https://www.entsog.eu/outlooks-reviews https://agsi.gie.eu/ 6 ENTSOG Summer Supply Outlook, p.4, 9, 16, 30, 33, 36 and Annex A, Strategic Storage. 7 Ibid, p. 6, 8. 8 On 29 April 2024, TTF day ahead price is 27.8 €/MWh, while Q4 2024 and Q1 2025 forward prices are 32.4 and 34.4 €/MWh respectively. Source: ICIS Heren.

text: Opinion No 03/2024

text: OIES Quarterly Gas Market Review, April 2024, p. 17 https://www.oxfordenergy.org/wpcms/wp-content/uploads/2024/04/OIES-Quarterly-Gas-Review-Issue-24- 2024-04-15.pdf 10 ENTSOG Summer Supply Outlook, p.9,13. 11 See previous Opinions on ENTSOG summer and winter outlooks https://www.acer.europa.eu/gas/infrastructure/security-of-supply 12 Ibid, p.12. 13 The Reference LNG supply case is calculated using the maximum 30-day rolling average. The Low LNG supply case is based on the average historical flows over the last five years for each season. The High LNG supply case is only limited by the regasification capacity of European LNG terminals and the capacity of the transmission network.

text: Opinion No 03/2024

text: ENTSOG Summer Supply Outlook, p.12. and Annex B. 15 ACER MMR: Analysis of the European LNG market developments for LNG, pp.26, 27. In 2023, the EU imported 18 bcm of Russian LNG: https://www.acer.europa.eu/monitoring/MMR/LNG_market_developments_2024 16 Ibid. 17 ENTSOG Summer Supply Outlook, p.9 lists the main gas infrastructure projects coming online. 18 A list of LNG capacities/terminals taken into account should be provided for transparency.

text: Opinion No 03/2024

text: GIE’s platforms AGSI for storage and ALSI for LNG collected contracted capacity, although the reporting of contracted capacity from operators is currently very limited. 20 ENTSOG Summer Supply Outlook, p.10. 21 Gas Market Report, Q3-2024, July 2024, p.25 https://iea.blob.core.windows.net/assets/a5df21c9-84a8-4c83-b6ef-d30c1a127dd2/GasMarketReport%2CQ3- 2024.pdf 22 https://www.consilium.europa.eu/en/press/press-releases/2024/03/04/security-of-gas-supply-member-statesagree-on-recommendation-to-continue-voluntary-demand-reductionmeasures/#:~:text=Extended%20period%20for%20voluntary%20demand,2017%20to%2031%20March%20202 23 Thanks to demand reduction measures, the EU has succeeded in saving approximately 65 billion cubic meters of Russian gas in 2023, primarily in households and industries. Demand side measures (while voluntary based on consumer behaviour and not in demand destruction) help phase out of Europe’s remaining dependency on Russian gas.

text: Opinion No 03/2024

text: ENTSOG Summer Outlook, conclusions, p.6.

text: Opinion No 03/2024

text: Opinion No 03/2024

identifier: ACER Opinion No 03/2024

publisher: Europeiska unionens byrå för samarbete mellan energitillsynsmyndigheter

sprak: en

title: ACER Opinion 03-2024 on ENTSOG Summer Supply Outlook 2024

serie: yttranden

text: PUBLIC

type: stycke

text: OPINION No 03/2024 OF THE EUROPEAN UNION AGENCY FOR THE COOPERATION OF ENERGY REGULATORS of 18 July 2024 on ENTSOG’s Summer Supply Outlook 2024

type: rubrik

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 (EC) No 715/2009

text: of the European Parliament and of the Council of 13 July 2009 on conditions for access to the natural gas transmission networks and repealing

text: Regulation (EC) No 1775/2005

text: , and, in particular, Articles

text: and

text: thereof, Having regard to the outcome of the consultation with ACER’s Gas Working Group, Having regard to the favourable opinion of the Board of Regulators of 17 July 2024, delivered pursuant to

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

text: , Whereas:

text: 1. INTRODUCTION

text: (1) On 16 April 2024, the European Network of Transmission System Operators for Gas (‘ENTSOG’) published its Summer Supply Outlook 2024 pursuant to

text: Article 8(3)

text: (f) of

text: Regulation (EC) No 715/2009

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 8(3) of Regulation (EC) No 715/2009

text: , as submitted by ENTSOG to ACER pursuant to

text: Article 9(2)

text: , first subparagraph, of

text: Regulation (EC) No 715/2009

text: 2. SUMMARY OF THE DOCUMENT

text: (3) ENTSOG’s Summer Supply Outlook 2024 assessed the European gas network readiness to meet demand, exports and the storage injection needs during the upcoming summer period (from 1 April 2024 to 30 September 2024) under different scenarios. The main goal is to reach a 90% filling level of storage by 1 October 2024. (4) ENTSOG applied several supply stress scenarios to assess the Union’s dependence on Russian piped gas and liquified natural gas (LNG). Russian piped gas was minimised and fully disrupted, while the availability of LNG supply for Europe was modelled under a high, reference and low supply scenarios. (5) Following the interest expressed by ACER and stakeholders, ENTSOG has carried out an extended analysis for the 2024/2025 winter season, starting from the simulation results obtained for the 2024 storage injection period. This extended scenario uses a reference case of reaching by 31 March 2025 a 59% storage filling level, which corresponds to the same filling level available by 31 March 2024.

text: ENTSOG main findings and conclusions (6) ACER underlines the importance of the following conclusions: a. New gas infrastructure, and particularly the new LNG terminals commissioned since autumn 2022 (most of them Floating Storage and Regasification Units, FSRUs), has contributed to reduce the gas system dependence on Russian piped gas, allowing additional imports from alternative gas supply origins. Moreover, selected cross-border capacity expansions have contributed to reduce supply congestion and help accommodate increasing West to East gas flows. With high storage levels at the beginning of the summer 2024 and assuming additional supply from other gas sources, in particular LNG, the gas network would enable to meet gas demand and fill storages by the end of the injection season without relying on Russian piped gas. b. Storages remain crucial for ensuring security of supply as they provide most of the seasonal supply flexibility during the winter season. Significant early withdrawals during the winter could however lead to low storage levels by the end of winter, impacting the gas system flexibility. To keep adequate security of supply levels, it is important to inject sufficient gas during summer and keep storages at adequate levels until the end of the winter. c. In the event of a combined full disruption of Russian pipeline gas supplies and limited availability of LNG supplies for Europe, storage withdrawals would have to be maximised in several countries to meet forecasted demand, implying low filling levels at the end of the 2024/25 winter, severely limiting their flexibility. In this scenario, gas demand measures and additional gas supply from other sources

text: would be necessary: for example, a reduction of gas demand by 15% due to changes in market behaviour or policy-based demand measures, and access to additional LNG supply would avoid demand curtailment risks and maintain adequate storage levels. d. Additional storage flexibility in the Union could be achieved by storing gas in Ukrainian storage facilities, which offer 10 bcm of storage available. Potential gas transit between Member States through Ukraine could also improve the interconnectivity between the CEE and SEE regions.

text: 3. ASSESSMENT

text: (7) In terms of scope of the assessment and the process followed by ENTSOG, ACER welcomes the timely publication of the Summer Supply Outlook 2024 ahead of the summer season. Furthermore, ACER appreciates the use of gas supply minimisation and disruption scenarios to assess the main risks for gas supply, as well as ENTSOG’s recommendations to mitigate risks of imbalance of gas supply and demand. In addition, ACER acknowledges ENTSOG’s and Gas Infrastructure Europe’s (GIE) efforts to make their gas supply monitoring tools available and continuously improve those. An assessment of the various assumptions and scenarios is provided below.

text: Gas storage assumptions

text: (8) On 1 April 2024, at the starting point of the outlook simulations, the storage filling level was 59% of the total EU-27 + UK storage capacity. This level lies in the higher range of the past 5 injection seasons and doubles the filling level observed two years ago. (9) ACER welcomes that ENTSOG has implemented its recommendation to consider the strategic reserves for storages set out by each country’s specific regulations in the assumptions for this Outlook, as it allows for “more realistic” simulations of storage utilisation. Strategic gas reserves in storages represent approximately 11% of the total European storage working gas volume on average. (10) ACER finds that the inclusion of the Ukrainian storage in ENTSOG’s model for the first time is an improvement. Ukrainian gas storage is large (10 bcm) and might provide additional seasonal supply flexibility to the European gas system, although its use presents risks. ACER finds it reasonable how ENTSOG has modelled Ukrainian gas storage as a last resort node, i.e. that it is only filled after other storages in the Union have been filled up to target levels. (11) While EU gas hub prices are subject to increasing volatility, TTF forward gas prices have overall flattened across 2024 in comparison to last year . In April 2024, summer-winter

text: price spreads remained cost-effective when furthermore discounting storage capacity costs, encouraging market-based gas storage injections, albeit less than last year. Summer-winter price spreads have an impact on the potential need to activate administratively-led storage measures. ACER understands that gas prices do not play a role in ENTSOG’s modelling tool and assumptions. However, as summer-winter price spreads may signal possible challenges for market-based filling of storage, ACER recommends ENTSOG to consider including background information on gas wholesale futures’ price data (e.g. on TTF) in upcoming seasonal outlooks.

text: Supply assumptions

text: (12) ACER reiterates that the Outlook conclusions are only valid if the gas supply from the various sources matches the volumes used in the simulations, which are based on historically observed data (for Norwegian, Caspian, Algerian and Libyan gas sources). The assumptions regarding Russian piped gas supply reflect the currently reduced Russian imports, which are limited to flows via Ukraine and TurkStream. As the transit contract of Russian gas via Ukraine will cease on 31 December 2024, the Outlook assumes no more Russian pipeline gas since this date. In ACER’s view, ENTSOG has used a prudent and plausible scenario for modelling the potential Russian pipeline gas supply, considering the likelihood of no more Russian gas flows via Ukraine to central European markets in 2025. This is one of the key gas supply risks to consider for the preparation of the upcoming winter 2024/2025. Moreover, such scenario will also affect gas supply imports into Ukraine during the rest of 2024, which are needed to replenish Ukraine’s gas storage facilities for winter.

text: (13) The Outlook does not consider whether other supply constraints (e.g. related to commercial aspects) may exist, nor the effect of limited gas supply on gas prices and demand. ACER has called on TSOs to factor in potential gas prices when submitting projected gas demand data . (14) ACER acknowledges that ENTSOG has implemented its recommendation to collect and factor in information on the availability of Norwegian gas supply by considering maintenance works on Norwegian gas fields in September 2024 .

text: LNG imports and its increasingly important role (15) ENTSOG’s supply assumptions for LNG consider three scenarios: a reference, a low and a high supply scenario . ACER welcomes this approach as it can be expected that the

text: Union will increase its reliance on LNG supply over the summer season to replenish storages 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. At the same time, ACER calls on ENTSOG to quantify and include information on the maximum supply potential under a high supply scenario of LNG , which is currently not provided unlike in other scenarios. (16) ACER calls on ENTSOG to consider a low LNG scenario without Russian LNG imports in future Outlooks. This low LNG scenario should be built based on the reference scenario, deducting historic Russian LNG imports to Europe. ACER believes that modelling a constraint on the availability of Russian LNG would allow to better anticipate how the Union would be prepared for a scenario of no Russian LNG (in addition to no Russian pipeline gas), which would also be aligned with the REPowerEU’s ambitions for 2027. In this sense, ACER has recently published an analysis of the European LNG market which includes a mid-term assessment of the EU gas supply and demand outlook. ACER’s report specifically assesses the current EU LNG contractual position and possible future LNG supply needs by 2030, under different EU policy and demand scenarios .

text: Infrastructure and capacity assumptions

text: (17) ENTSOG periodically upgrades the topology of its network model based on firm capacities provided by TSOs. ACER notes that the Outlook reflects the significant additional cross-border and LNG regasification capacities have come online during the year 2023, increasing the resilience and flexibility of the European gas network. In addition, ACER notes that Balticconnector came operational again in May 2024 and welcomes that ENTSOG has included transmission and storage capacities in Western Ukraine. (18) ACER welcomes that the Outlook mentions the projects commissioned during the last year. However, it encourages ENTSOG to provide more clarity on the timestamp of the network topology, and to list the significant monthly capacities added by commissioned projects (e.g. additional LNG import and cross-border capacities) in the Outlook. (19) ENTSOG’s simulations are under the assumption of efficient cooperation between the countries. ACER validates this assumption. In addition, ACER asks ENTSOG to consider explaining how the simulations would work out without the assumption of efficient cooperation. The objective of this request is to showcase the importance and added value of TSOs’ cooperation to deal with tight gas supply situations.

text: (20) Demand curtailment intervenes when the cooperation between countries is still insufficient to overcome the lack of infrastructure capability to balance supply and demand. ACER recommends that when demand curtailment appears in the Outlook, ENTSOG assesses specific infrastructure bottleneck(s) that may lead to curtailment of demand. (21) ACER reiterates that ENTSOG should investigate incorporating booked capacities in the modelling assumptions , as they may help simulate more accurately possible future gas flows.

text: Demand assumptions

text: (22) ENTSOG’s reference scenario expects that daily demand for the summer of 2024 is in the same range as the last three years, close to 9,000 GWh/d (7.4% higher than last year), while winter demand is estimated at 16 100 GWh/d (11% higher than last year) . Recently, the International Energy Agency (IEA) calculated that the European gas demand decreased by an estimated 3% in the first half of 2024, noting that gas demand for the power sector dropped by 20% y-o-y amid improving nuclear availability in France, the rapid expansion of renewables and a 25% y-o-y increase of Europe’s hydro power output. European gas demand in the residential and commercial sectors increased marginally, while gas use by industry continued its recovery, albeit fragile. (23) On 25 March 2024, the European 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, which replaces previous urgent European Regulation of 2022 on gas demand reduction measures, advises Member states to continue taking adequate supply security measures. (24) ACER notes that the ENTSOG’s Outlook uses TSOs’ gas demand projections for the reference scenarios, and that demand reduction is considered only as a sensitivity used for stressful gas supply scenarios. ACER notes that ENTSOG uses high gas demand projections for this Outlook when comparing it with scenarios from other sources (e.g. International Energy Agency). While considering conservative gas demand assumptions (i.e. high demand figures) adds value to understanding the extent to which the gas system would cope under high demand situations, it would be preferable to combine a base-case

text: scenario with more realistic assumptions about demand (i.e. by aligning those with demand scenarios from other sources) with a sensitivity reflecting a higher-than-expected demand situation.

text: Disruptions scenarios and risk factors

text: (25) The Outlook disruption scenarios simulate the cease of piped Russian gas flows and limited availability of liquified natural gas (LNG) from all sources. ACER finds these assumptions relevant, as they match the two main supply risk factors the Union faces for the upcoming summer and winter . In this sense, ACER agrees on the importance of securing additional LNG for the European Union and to activate demand response should this scenario materialise. (26) However, this scenario could be heightened by pipeline disruption scenarios for sources other than Russia, which are much less likely to occur (e.g. limited gas supplies from Algeria, prolonged disruption of Norwegian gas supplies via offshore pipeline such as Europipe, Norpipe, Zeepipe or Franpipe). Such additional combined extreme scenarios would provide useful insights regarding the readiness of the European gas infrastructure to deal with less likely but still highly impactful disruption scenarios.

text: Risk factors for upcoming summer and winter seasons (27) The following main risk factors are relevant for the upcoming summer and winter season: a. A possible full stop of already reduced Russian gas transit flows via Ukraine from 1 January 2025, as there is a risk that Ukraine’s long-term transit agreement for Russian gas will not be renewed; b. A colder than usual winter, driving up gas demand; c. Lack of implementation of gas demand reduction recommendations; d. Limited additional gas volumes from gas pipeline imports beyond the contracted/booked volumes; e. The level of LNG price imports to the EU, quite influenced by Asian’s demand; f. Increased demand volatility of gas power plants; and g. Operational incidents or accidents in major supply routes, upstream production sites or major LNG liquefaction terminals limiting the availability of gas supply to the EU market. (28) Finally, ACER reiterates the importance of continuing ENTSOs’ exchange of data and results used for the seasonal gas and electricity outlooks, in particular for the determination of gas volumes needed for operating critical gas-fired power plants as well as critical electricity facilities for the gas system (e.g. electricity-driven compressors to guarantee adequate pressure levels in the gas systems).

text: 4. CONCLUSION

text: (29) Based on the foregoing assessment, ACER: a. Welcomes ENTSOG’s improvements in the Outlook’s methodology, namely: i. Use of an extended analysis covering the supply outlook for 2024 and the winter 2024/2025 season; ii. Use of assumptions regarding strategic reserves for storages in the modelling to allow for more realistic simulations of storage utilisation; iii. Inclusion of Ukrainian’s storage in the model and modelling its utilisation under the supposition that it would be filled only after other storages in the Union have reached their targets; iv. Factoring in maintenance works in the Norwegian gas fields in September 2024 into the gas supply assumptions; v. Use of a conservative scenario of Russian piped gas supply potential, which builds on no more Russian gas flows via Ukraine to central European markets in 2025; and vi. Use of three different LNG supply scenarios to assess the Union’s increased reliance on liquefied natural gas (LNG) supply. b. Stresses the following conclusions from ENTSOG’s summer supply Outlook and winter 2024/2025 overview, namely: i. Storages remain crucial for ensuring security of supply as they provide flexibility of gas supply during the winter season. Significant early withdrawals during the winter could lead to low storage levels by the end of winter, impacting the gas system flexibility. To keep adequate security of supply levels, it is important to inject gas during summer and keep storages at adequate levels until the end of the winter. ii. In the event of a combined full disruption of Russian pipeline supplies and limited availability of LNG supplies, storages would have to be used at maximum level in some countries to meet demand and would end the winter 2024/2025 on a very low level, limiting severely their flexibility. In this scenario, reducing gas demand by 15% due to market behaviour changes or policy-based demand measures, and access to additional LNG supply would avoid demand curtailment risks and help maintain adequate storage levels until the end of the season. iii. There is uncertainty about the continuity of already reduced Russian gas transit flows via Ukraine from 1 January 2025, as there is a risk that Ukraine’s longterm transit agreement for Russian gas will not be renewed. The Union’s storage flexibility could be enhanced by storing extra volumes in the Ukrainian Western storage facilities, which count with 10 bcm of storage available. c. Calls on ENTSOG to consider further methodological improvements in next Outlooks, namely:

text: i. Quantify and include the maximum supply potential under a high-supply scenario of LNG, similarly to how it is done for other gas sources and LNG scenarios, and consider a low LNG scenario without Russian LNG imports; ii. Collect and publish the assumptions used to define the demand data provided by the TSOs (including the underlying gas price assumptions, where relevant). In this sense, ENTSOG should consider facilitating the provision of such data in a consistent manner, e.g. by aligning the assumptions about the evolution of gas prices; iii. Assess whether the TSOs’ gas demand projections are consistent with the gas demand estimates from other entities and with European aspirations for gas demand reduction; iv. Provide a clearer timestamp of the network topology and list significant capacities added by commissioned projects during the season (e.g., additional LNG import and cross-border capacities); v. Investigate considering booked capacities in the modelling assumptions; vi. Include, for information, future gas wholesale price data; and vii. Proactively engage with stakeholders well in advance of the supply Outlooks' preparation and consult them on the proposed methodology to gain insights into expected improvements,

text: HAS ADOPTED THIS OPINION:

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

text: Regulation (EU) 2019/942

text: and

text: Regulation (EC) No 715/2009

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.

text: Done at Ljubljana, on 18 July 2024.

text: - SIGNED -

text: Fоr the Agency The Director

text: C. ZINGLERSEN

type: vagledning

utgivare: acer


text: OJ L158, 14.6.2019, p. 22. 2 In its first Opinion 12/2019, ACER already agreed with the approach to merge the two reports into a single report.

text: Opinion No 03/2025

text: ACER Opinion 12-2019 on the ENTSO-E Balancing Monitoring Plan.pdf 4 Annex I of ACER Decision 13/2020 on the IN IF, amended by ACER Decision 16/2022

text: Opinion No 03/2025

text: Annex I of ACER Decision 02/2020 on the aFRR IF, amended by ACER Decision 15/2022, and ACER Decision 08/2024 6 Annex I of ACER Decision 03/2020 on the mFRR IF, amended by ACER Decision 14/2022 7 Annex I of ACER Decision 01/2020, amended by ACER Decision 03/2022, and ACER Decision 09/2024 8 Annex I of ACER Decision 11/2023, amended by ACER Decision 01/2025 9 Annex I of ACER Decision 18/2020

text: Opinion No 03/2025

text: Table 1The list of ENTSO-E reports from the Methodologies from the EB Regulation and ACER's proposal for new timelines and inclusion in the European report in accordance with Article 59 of the EB Regulation

text: Methodology Article Topic First submission Frequency ACER’s To be added as proposal for part of the the new timing European report in accordance with Article 59 of the EB Regulation

text: IFs Article 5(4) of Accession Apr-20 Every 6 months ACER No the aFRR and roadmaps of the encourages mFRR IF European ENTSO-E to balancing publish more platforms frequent accession roadmaps if needed.

text: IFs

text: Article 21(3)

text: Publication of the Apr-22 One month No No of the aFRR algorithm before go-live and mFRR IF, description of the respective

text: Article 19(3)

text: platform and of IN IF further updated if necessary

text: IFs Article 15 of Annual work Sep-23 Yearly No No the aFRR and programme of the mFRR IF, European Article 11 of balancing the IN IF platforms

text: IFs

text: Article 13(7)

text: Efficiency and After the Bi-yearly Jul-26 Yes of the aFRR effectiveness implementation and mFRR IF assessment of the of the Capacity European management balancing Function (CMF) platforms

text: IFs

text: Article 13(3)

text: Comparison of 24 months after Only one Jul-26 Yes of the aFRR IF alternative implementation submission control models deadline of aFRR required platform

text: Opinion No 03/2025

text: for aFRR platform

text: IFs

text: Article 13(3)

text: Evaluation of the 36 months after Only one Jul-27 Yes of the mFRR impact of implementation submission IF scheduled deadline of required counter- mFRR platform activations at mFRR platform

text: Pricing

text: Article 11(3)

text: All TSOs 7-Dec-22 Quarterly The report is No Methodology Quarterly report required to be on the pricing of submitted only balancing energy until the and cross-border transitional capacity period expires (until 24-Jul-26)

text: Pricing

text: Article 11(4)

text: All TSOs price Jun-22 Incident-based The report is No Methodology incident reports required to be on price spikes at submitted only the European until the platforms transitional period expires (until 24-Jul-26)

text: Pricing

text: Article 11(5)

text: All TSOs long- 36 months after Only one No No Methodology term assessment the submission of the functioning implementation required of the European deadline of the balancing European markets balancing platforms

text: Pricing

text: Article 10(8)

text: TSOs Latest 24 months Every two Not needed Not applicable Methodology reassessment of after the years, under the the harmonised implementation European maximum and deadline of the Report in minimum European accordance with balancing energy balancing

text: Article 59(2)

text: (a) prices to the so- platforms of the EB called “price Regulation limits”, and consultation with stakeholders in forums

text: ACER considers this deliverable has already been fulfilled by the TSOs in the TSO proposal for the 2 amendment to the Pricing Methodology

text: Opinion No 03/2025

text: Optimisation Function Software (CZCAOF) software

text: ISH

text: Article 12(3)

text: Assessment of 24 months after Only one Initial report to Yes for the the need for the submission be submitted by initial report further implementation required Jul-26 and final harmonisation of deadline of the report submitted the imbalance European to ACER and settlement Platforms NRAs by Jul-27

text: Opinion No 03/2025

text: Opinion No 03/2025 Annexes: Annex I: First amendment of the ENTSO-E Monitoring Plan in accordance with

text: Article 63(2) of Commission Regulation (EU) 2017/2195 of 23 November 2017

text: establishing a Guideline on Electricity Balancing

identifier: ACER Opinion No 03/2025

title: ACER Opinion 03-2025 on the first amendment of ENTSO-E's monitoring plan

text: PUBLIC

text: OPINION No 03/2025 OF THE EUROPEAN UNION AGENCY FOR THE COOPERATION OF ENERGY REGULATORS of 16 April 2025 on the first amendment of the ENTSO-E Monitoring Plan in accordance with

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

text: 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 , and, in particular,

text: Article 4(2)

text: thereof,

text: Having regard to

text: establishing a guideline on electricity balancing (‘EB Regulation’) and, in particular,

text: Article 63(2)

text: thereof,

text: Whereas:

text: 1. INTRODUCTION

text: (1) In accordance with Article 63(1) of the EB Regulation, ENTSO-E shall monitor the implementation of the EB Regulation. This monitoring shall cover at least the preparation of the European report in accordance with Article 59 of the EB Regulation and the preparation of a report on monitoring of the implementation of the EB Regulation including the effect on the harmonisation of applicable rules aimed at facilitating market integration .

text: (2) In accordance with Article 63(2) of the EB Regulation, ENTSO-E shall submit a monitoring plan on the reports to be prepared and any updates to ACER for an opinion

text: by six months after entry into force of the EB Regulation. ENTSO-E submitted the first Monitoring Plan on 6 June 2018. ACER issued its first Opinion 12/2019 on the Balancing Monitoring plan on 20 May 2019. (3) On 10 December 2024, ENTSO-E submitted to ACER for an opinion the First amendment of ENTSO-E Monitoring Plan in accordance with Article 63(2) of the EB Regulation (‘Amendment’).

text: Article 63(2)

text: does not specify a clear timeline for ACER to issue this opinion.

text: 2. SUMMARY OF THE AMENDMENT

text: (4) The Amendment consists of the following main chapters: a. Introduction; b. General overview of the reporting obligations pursuant to the EB Regulation; c. Reporting obligations from the Terms, Conditions and Methodologies (‘TCMs’) stemming from the EB Regulation; and two Annexes: d. Annex 1 – Detailed description of the EB Regulation- related reporting. e. Annex 2 – Scope: List of Countries.

text: 3. ACER’S ASSESSMENT OF THE AMENDMENT

text: General comments on the Amendment

text: (5) Chapter 2 of the Amendment lists the reporting obligations pursuant to the EB Regulation, including the first submission date and the frequency of future submissions. Annex I of the Amendment provides a detailed description of what these reports need to contain in accordance with the EB Regulation. (6) Since the submission of the initial Monitoring Plan by ENTSO-E, several decisions on Methodologies in accordance with the EB Regulation have been taken, which required TSOs to further develop analyses on certain aspects of the balancing markets and submit additional reports to ACER. Methodologies containing such provisions are listed in Chapter 3 of the Amendment, and these are the following: • Implementation Framework for a European platform for the imbalance netting process (IN IF );

text: • Implementation framework for the European platform for the exchange of balancing energy from frequency restoration reserves with automatic activation (aFRR IF );

text: • Implementation framework for the European platform for the exchange of balancing energy from frequency restoration reserves with manual activation (mFRR IF );

text: • Implementation framework for the European platform for the exchange of balancing energy from replacement reserves (RR IF);

text: • Pricing Methodology

text: • Harmonised Cross-zonal capacity allocation Methodology

text: • Imbalance Settlement Harmonisation Methodology

text: (7) ACER considers that all the required reports from the EB Regulation and the Methodologies stemming from the EB Regulation, timings and their frequency of publication have been correctly listed in the Amendment. However, the description of the scope of some of the reports could be improved. For example, the European report on the integration of balancing markets in accordance with Article 59 of the EB Regulation needs to contain all the elements listed down in Article 59(3) of the EB Regulation, and not only those listed in the Amendment.

text: Comments related to the reports pursuant to the EB Regulation Methodologies

text: (8) ACER acknowledges that the deadline for submitting certain reports is approaching. These deadlines were introduced based on the assumption that all or most of the TSOs would be connected to the European platforms for the exchange of balancing energy within 24 months after the legal deadline, which was July 2022 or at the latest before the 2-year maximum derogation deadline which was in July 2024. Given that the derogation deadline has passed, and only a number of TSOs are currently connected to the Platforms, ACER agrees that TSOs may take additional time to issue some of the reports.

text: (9) ACER’s proposal to adjust the timings of certain reports and incorporate them into the European Report in accordance with Article 59 of the EB Regulation is summarized in Table 1 below.

text: (10) ACER encourages ENTSO-E, should any additional synergies be identified, to propose simplifications to ACER to streamline and reduce reporting obligations without the need to submit another amendment to the Monitoring Plan. In this regard, ACER welcomes the collaboration between ENTSO-E and ACER to simplify the reporting process once the Methodologies containing reporting requirements are submitted for amendments.

text: (11) Given that ACER proposed that the submission of certain reports is postponed until the majority or all TSOs are connected to the European platforms and sufficient operational data is available to conduct the required analyses, ACER urges ENTSO- E to shift its focus in the meantime from the monitoring activities toward improving the quality of the balancing data required to be published in accordance with

text: Article 17 of Regulation (EU) No 543/2013

text: on submission and publication of data in electricity markets and amending Annex I to

text: Regulation (EC) No 714/2009

text: of the European Parliament and of the Council the Transparency regulation (‘Transparency Regulation), Article 12 of the EB Regulation and Articles stemming from the EB Regulation Methodologies. This would enable all relevant stakeholders, including NRAs and ACER, to conduct their own analyses and monitoring more effectively.

text: Alignment of reporting periods of all reporting obligations

text: (12) In its Chapter 3, ENTSO-E proposes to further align the covered period of all reporting obligations to correspond to a calendar year from 1 January to 31 December.

text: (13) ACER welcomes this proposal, as aligning all reporting obligations to a calendar year enhances simplicity and clarity by ensuring consistency across reporting periods and making the comparison and analysis of data easier.

text: 4. CONCLUSION

text: (14) ACER considers that the updated Monitoring Plan fulfils the requirements from the EB Regulation, since it provides a list of the reports that need to be published by ENTSO-E stemming from the EB Regulation, as well as from the respective Methodologies pursuant to the EB Regulation, and contains timelines, frequency and description of the reporting content. ACER notes that certain elements of the updated Monitoring plan such as the description of the content of some of the reports could be further improved.

text: (15) ACER acknowledges that the high number of required reports may place significant burden on ENTSO-E’s resources and potentially divert attention from other priority tasks. Therefore ACER,

text: HAS ADOPTED THIS OPINION:

text: 1. Considering the significant delays in some TSOs' accessions to the EB Platforms, ACER acknowledges the need for additional time to produce certain reports. Therefore, ACER recommends that ENTSO-E adopts alternative timelines for their publication. ACER expects that these alternative timelines are formally proposed to ACER once the respective Methodologies are submitted for amendments.

text: 2. ACER recommends that ENTSO-E, in the meantime, prioritise improving the quality of balancing data published on the ENTSO-E Transparency Platform to ensure that stakeholders, NRAs, and ACER can effectively conduct their respective monitoring and analyses. ACER expects ENTSO-E to commence this work without delay.

text: 3. ACER recommends that ENTSO-E promptly notifies ACER upon identifying synergies between reporting obligations, without the need to resubmit the amended Monitoring Plan. This will facilitate more timely discussions and the implementation of the most effective solutions.

text: 4. ACER recommends that ENTSO-E and ACER collaborate to progressively reduce the number of reports that need to be published.

text: This Opinion is addressed to ENTSO-E.

text: Done at Ljubljana, on 16 April 2025.

text: - SIGNED -

text: Fоr the Agency The Director

text: C. ZINGLERSEN