EU Energy Regulators Concerned About Future Efficiency Of Cross-Border Capacity Calculation

European Energy Regulators are concerned that some provisions in the Clean Energy Package, as they are emerging from the current negotiations, might derail the implementation of efficient cross-border capacity calculation.

The recent developments in the legislative process for the recast of the Electricity Regulation – especially in respect to Articles 13 and 14 – were discussed at the 75^th meeting of the Agency’s Board of Regulators (BoR) on 6 June.

The Director and the vast majority of National Regulatory Authorities represented in the BoR expressed their concerns about the setting of an arbitrary minimum target for cross-border commercial capacities for all European interconnectors, along with the possibility for Member States to opt out until 2026 from the framework provided by the Capacity Allocation and Congestion Management (CACM) Guideline if they are unable to meet this target.

The Agency strongly believes that this approach goes against some fundamental principles and obligations under the Treaty on European Union and the Third Energy Package, such as efficiency, transparency, non-discrimination and regulatory independence.

The same concerns were expressed by the Agency at the European Electricity Regulatory Forum in Florence last week. There, the Agency highlighted that the Internal Energy Market is based on the well-established principle that electricity shall be allowed to move freely across the Union, in line with the freedom of movement of goods and services established by the Treaty on European Union. This relies on the right of transparent and non-discriminatory access to electricity grids. Articles 13 and 14 in the Electricity Regulation recast should indeed serve the same free-movement principle, which is a prerequisite for cross-border electricity trade in the Internal Energy Market and, thereby, for delivering benefits to consumers.

The aim of these provisions, as the European Commission’s proposal reiterates, should be to address the persisting problem of significant national limitations to cross-border electricity flows and to ensure that electricity exchanges are not unduly restricted.

Therefore, the Agency  calls upon the European Institutions to reaffirm the cross-border capacity calculation approach as defined in the CACM Guideline and, thus, to reinstate the text of Articles 13 and 14 of the Electricity Regulation recast as proposed by the European Commission.