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ENTSO-E Welcomes EC's New Guidelines on Environment and Energy Aid

(PresseBox) (Brussels, ) ENTSO-E has today (14 February) welcomed the European Commission (EC) proposals for a review of the Community Guidelines on State Aid for Environmental Protection. Responding to the proposals, ENTSO-E said the recommendation to broaden the scope of the Guidelines to include energy related issues is a positive move that will lead to increased legal certainty and contribute to the quality of public spending by streamlining state interventions.

TSOs have a key-role in the completion of the internal energy market, the achievement of the Union's 20-20-20 climate objectives and in ensuring the security of supply at European level. None of the main European energy policy goals can be met without an integrated, secure and reliable power system. The design and implementation of energy state aid must take this fact into account and ensure that the appropriate measures are in place in order for TSOs to plan, operate and develop a pan-European transmission system that meets the needs of European citizens now and in the future.

Therefore we have highlighted the need for further clarification and adjustment in a number of areas.

Aid to energy infrastructure

ENTSO-E believes that the Guidelines should only provide clarification on the legal requirements set out by the Treaty (TFEU Art. 107), and should not introduce additional restrictions for state aid for energy infrastructure. ENTSO-E also underlines that, apart from the Union's Projects of Common Interest, many other investments in grid development (e.g. TYNDP projects or projects of national relevance) contribute to the achievement of the Union's climate and energy goals. Such investments should also fall under the scope of these Guidelines.

Aid for adequacy

ENTSO-E supports the Commission's acknowledgement of TSOs' expertise when determining risks on adequacy and the associated impacts on security of supply. We strongly agree that the decision to implement adequacy measures should be based on careful assessment of the physical needs of the system. In this regard, increasing production or exchanges of energy and reducing consumption all contribute to security of supply and should be encompassed without any discrimination in adequacy assessments.

Capacity mechanism designs

ENTSO-E shares the views of the Commission that capacity mechanism designs need to respect some key principles: market-based, non-discriminatory, forward looking, transparent and cost-effective in the interest of consumers. Generation, cross-border exchanges and demand-response all contribute to the security of supply and should therefore be eligible to participate in capacity mechanism regimes.

Aid to energy from renewable energy sources (RES)

With regard to specific RES-E support schemes, ENTSO-E believes that all mature technologies should be exposed to wholesale market price signals. In this context, certificates or premiums should be privileged over feed-in tariffs and the Guidelines should enable the phase out of state aid where appropriate. RES should be integrated into the market and be balance-responsible, reduce operational complexity for TSOs, potential risks to the security of electricity and reduce the associated costs to end consumers.

Lastly, specific non-financial support to RES-E such as priority dispatch, even if not considered as state aid, may severely constrain the security of the system, in the context of high penetration levels of RES and CHP.

Related Links:
ENTSO-E Response to EC's New Guidelines on Environment and Energy Aid