ENTSOG GRIP BEMIP 2014-2023 / Main Report

markets are relatively small and could not bear the costs of such infrastructure with- out the EU co-financing. Furthermore, it is worth noting that network codes development process started in 2011. According to the Regulation 715 / 2009 on conditions for access to the natural gas transmission networks, ENTSOG is responsible for promoting the com- pletion and functioning of the internal market in natural gas, among other things, by drafting the network codes in 12 areas identified by the Regulation. Since 2011, the first two network codes have already been developed and approved (capacity allocation mechanisms (CAM) and balancing). The third one – on interoperability and data exchange rules has been drafted and passed on by ENTSOG for further adoption procedures in ACER and EC. The subsequent network code on tariffs harmonisation and amendment of CAM network code by introducing provisions on incremental capacity are expected to be covered in 2014. These network codes fos- ter the move towards an enhanced competition and liberalisation on the gas mar- kets in the EU. The network codes once drafted by ENTSOG and approved by EU institutions, are transposed into national network codes and rules by TSOs and national institutions if amendments of other legislation are needed. Apart from actions of legislative nature, an important discussion on the future of energy markets is currently held between the EU institutions, Member States and other stakeholders. The objective of this measure is to analyse the lessons learnt from the current climate and energy agenda of the EU and to conclude on the main directions of the future evolution of the energy markets. In this context, the role of natural gas seems to be uncertain. However, natural gas given its favourable carbon footprint and availability of its traditional and unconventional sources in different parts of the world may significantly contribute to the energy mix in the EU countries in the future as well.

1.2 PCIs Status and Selection Process

It all started in October 2011, when the EC presented a so called Infrastructure package to enhance TEN-E development in the fields of energy, transport and infor- mation society. Among few legislative proposals, the package included TEN-E guidelines, establishing energy infrastructure policy and the proposal for the CEF, providing financial aid for the development of the infrastructure. The TEN-E guide- lines included a new way of identifying energy infrastructure projects that can receive the label of PCIs, the label as such embedded in Treaty on the Functioning of the EU (Art. 171), and to benefit from the measures foreseen in the TEN-E guide- lines for the facilitation of implementation of such projects. The standard way for the selection of PCIs would be that the projects eligible for PCI status would have to be at first included in the TYNDP of ENTSOG, satisfy the general and specific criteria set in Art. 4 of TEN-E Regulation and have a cost- benefit analysis (CBA) performed showing that cross-border socio-economic bene- fits of the project outweigh its costs. The applications for the selection of the project as PCI would have to be submitted for the evaluation of the Regional Groups estab- lished following Art. 3 of TEN-E Regulation. Once the Regional Group draws up regional list of PCIs subject to the approval of the Member States to which the PCIs relates, the EC should include it in the Union-wide list of PCIs. In the 1st quarter of 2012, the EC has established ad-hoc working groups for every priority corridor foreseen in draft TEN-E Regulation. The projects-candidates for PCI status were considered irrespectively whether they are included in TYNDP or not – the open request for project promoters to submit applications was launched in May

8 |

Baltic Energy Market Interconnection Plan GRIP 2014–2023