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    EU Bodies Push for Simpler Project Regulation: Update


EU central energy regulatory bodies want to reduce the ability of infrastructure operators to build projects on the basis of flawed cost-beneft analysis. The operators disagree.

by: William Powell

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EU Bodies Push for Simpler Project Regulation: Update

(Adds reaction from Entsog)

The European Union's Agency for Co-operation of Energy Regulators (Acer) and the Council for European Energy Regulators (CEER) are pushing to streamline the regulatory process for cross-border energy infrastructure projects. They want more influence over the cost-benefit analysis (CBA) process, among other aims.

They want to stop funding projects of common interest – and of mutual interest in the case of non-EU members – that are part of the Trans-European Networks for Energy (TEN-E) and do not fit with the objectives of the EU Green Deal. 

In a March 5 paper on the TEN-E regulation, Acer-CEER said the European National Transmission System Operators Gas (Entsog) was not neutral in its CBA. "Acer should be empowered to approve and, when needed, amend or request amendments to the Entosog's CBA methodologies due to its neutral role, agility to deliver timely and adequate technical skills for assessing the technical aspects of the methodologies," it said.

They also said that a regulatory framework for the treatment of hydrogen was still missing and "it is not certain whether hydrogen will be added to the internal market legislation for gas, justifying similar treatment in the PCI selection process."

"Leaving hydrogen planning and CBA assessment to Entsog bears a risk of creating once more a perception of lack of neutrality and conflict of interest. The lack of preciseness of the smart gas grid category leads to a risk of selecting projects without significant cross-border impacts," it said.

Cross-border investment decisions should be exclusively a competence of the national regulatory authority (NRA) and, where relevant, Acer. Acer itself comprises representatives of NRAs.

Entsog sees infrastructure essential for climate neutrality

Responding to the paper later March 8, Entsog said it welcomed "the revision of the existing rules to ensure future energy infrastructure projects align with Europe’s climate-neutral ambition." Gas pipeline, storage and LNG regasification terminals will all play an important role in the transition, once repurposed/retrofitted for the transition to hydrogen and other low-carbon gases. It said it looked forward to discussing the TEN-E proposal further with the European Commission.  

Hydrogen projects should be included in the sixth PCI list in order to allow adequate planning. And projects already on the list should stay on it, to ensure market stability. Additionally with blue hydrogen, there will be the need for CO2 transmission and storage projects, to facilitate 'full-chain' carbon capture and storage technologies. it said.