REPORT on the proposal for a regulation of the European Parliament and of the Council amending Regulation (EC) No 1228/2003 on conditions for access to the network for cross-border exchanges in electricity

5.6.2008 - (COM(2007)0531 – C6‑0320/2007 – 2007/0198(COD)) - ***I

Committee on Industry, Research and Energy
Rapporteur: Alejo Vidal-Quadras

DRAFT EUROPEAN PARLIAMENT LEGISLATIVE RESOLUTION

on the proposal for a regulation of the European Parliament and of the Council amending Regulation (EC) No 1228/2003 on conditions for access to the network for cross-border exchanges in electricity

(COM(2007)0531 – C6‑0320/2007 – 2007/0198(COD))

(Codecision procedure: first reading)

The European Parliament,

–   having regard to the Commission proposal to the European Parliament and the Council (COM(2007)0531),

–   having regard to Articles 251(2) and 95 of the EC Treaty, pursuant to which the Commission submitted the proposal to Parliament (C6‑0320/2007),

–   having regard to Rule 51 of its Rules of Procedure,

–   having regard to the report of the Committee on Industry, Research and Energy and the opinions of the Committee on Economic and Monetary Affairs and the Committee on the Internal Market and Consumer Protection (A6‑0228/2008),

1.  Approves the Commission proposal as amended;

2.  Calls on the Commission to refer the matter to Parliament again if it intends to amend the proposal substantially or replace it with another text;

3.  Instructs its President to forward its position to the Council and the Commission.

Amendment  1 Proposal for a regulation – amending act Recital 3
Text proposed by the Commission	Amendment
(3) However, at present, the right to sell electricity in any Member State on equal terms, without discrimination or disadvantage cannot be guaranteed to any company in the Community. In particular, non-discriminatory network access and an equally effective level of regulatory supervision in each Member State do not yet exist.	(3) However, at present, the right to sell electricity in any Member State on equal terms, without discrimination or disadvantage cannot be guaranteed to any company in the Community. In particular, non-discriminatory network access and an equally effective level of regulatory supervision in each Member State do not yet exist and isolated markets endure.
Amendment  2 Proposal for a regulation – amending act Recital 4
Text proposed by the Commission	Amendment
(4) The Communication of the Commission to the European Parliament and the Council entitled "An Energy Policy for Europe" highlighted the importance of completing the internal market in electricity and to create a level playing field for all electricity companies in the Community. The Communication from the Commission to the European Parliament and to the Council on prospects for the internal gas and electricity market and the Communication from the Commission "Inquiry pursuant to Article 17 of Regulation (EC) No 1/2003 into the European gas and electricity sectors (Final Report)" showed that the present rules and measures do not provide the necessary framework to achieve the objective of a well functioning internal market.	(4) The Communication of the Commission to the European Parliament and the Council entitled "An Energy Policy for Europe" highlighted the importance of completing the internal market in electricity and to create a level playing field for all electricity companies in the Community. The Communication from the Commission to the European Parliament and to the Council on prospects for the internal gas and electricity market and the Communication from the Commission "Inquiry pursuant to Article 17 of Regulation (EC) No 1/2003 into the European gas and electricity sectors (Final Report)" showed that the present rules and measures neither provide the necessary framework nor provide for the creation of physical connections to achieve the objective of a well-functioning, efficient and open internal market.
Amendment  3 Proposal for a regulation – amending act Recital 6
Text proposed by the Commission	Amendment
(6) In particular, increased cooperation and coordination among transmission system operators is required to ensure progressive compatibility of the technical and commercial codes for providing and managing effective access to the transmission networks across borders, and to ensure coordinated and sufficiently forward looking planning and sound technical evolution of the transmission system in the Community, with due regard to the environment, and promote energy efficiency and research and innovation notably with respect to ensuring penetration of renewables and dissemination of low carbon technology. Transmission system operators should operate their networks according to these compatible technical and market codes.	(6) In particular, the creation of physical connections and increased cooperation and coordination among transmission system operators are required to ensure progressive compatibility of the technical and commercial codes for providing and managing effective and transparent access to the transmission networks across borders, and to ensure coordinated and sufficiently forward looking planning and sound technical evolution of the transmission system in the Community, with due regard to the environment, and promote energy efficiency and research and innovation notably with respect to ensuring penetration of renewables and dissemination of low carbon technology. Transmission system operators should operate their networks according to these compatible technical and market codes.
Amendment  4 Proposal for a regulation – amending act Recital 7
Text proposed by the Commission	Amendment
(7) In order to ensure an optimal management of the electricity transmission network and to allow trading and supplying electricity to retail customers across borders in the Community a European network of the transmission system operators should be established. Its tasks should be carried out in compliance with Community competition rules which remain applicable to the decisions of the European network of the transmission system operators. Its tasks should be well-defined and their working method should be such as to ensure efficiency, representativity and transparency. Given that more effective progress may be achieved through an approach at regional level, transmission system operators should set up regional structures within the overall cooperation structure, whilst ensuring that results at regional level are compatible with codes and investment plans at Community level. Cooperation within such regional structures presupposes effective unbundling of network activities from production and supply activities in the absence of which regional cooperation between transmission system operators gives rise to a risk of anti-competitive conduct.	(7) In order to ensure an optimal management of the electricity transmission network and to allow trading and supplying electricity to retail customers across borders in the Community a European network of the transmission system operators should be established. Its tasks should be carried out in compliance with Community competition rules which remain applicable to the decisions of the European network of the transmission system operators. Its tasks should be well-defined and their working method should be such as to ensure efficiency, representativity and transparency. Given that more effective progress may be achieved through an approach at regional level, transmission system operators should set up regional structures within the overall cooperation structure, whilst ensuring that results at regional level are compatible with codes and investment plans at Community level. Member States should promote cooperation and monitor the effectiveness of the network at regional level. Cooperation at regional level should be compatible with progress towards a competitive and efficient internal market for electricity.
Amendment  5 Proposal for a regulation – amending act Recital 8
Text proposed by the Commission	Amendment
(8) All market participants have an interest in the work expected of the European network of transmission system operators. The consultation process is therefore essential and existing structures that are set up to facilitate and streamline the consultation process, such as the Union for the Coordination of Transmission of Electricity (UCTE), should play an important role.	deleted
Justification
Public consultations at EU level are currently undertaken by ERGEG. Therefore the Agency should undertake this task as it has already well established rules and experience in carrying out public consultations. Moreover the Agency acts in the interest of all market participants, while TSOs are potentially an interested party. In order to ensure efficiency of the process, it should be emphasised that the creation of too many consultation bodies might lead to duplication of consultation processes.
Amendment  6 Proposal for a regulation – amending act Recital 8 a (new)
Text proposed by the Commission	Amendment
	(8a) In order to ensure greater transparency regarding the entire electricity transmission network in the European Union, the Commission should draw up, publish and regularly update a road map. All feasible electricity transmission networks and possible regional connections should be included in that road map.
Amendment  7 Proposal for a regulation – amending act Recital 9
Text proposed by the Commission	Amendment
(9) Market monitoring undertaken over recent years by the national regulatory authorities and by the Commission has shown that current transparency requirements and rules on access to infrastructure are not sufficient.	(9) Market monitoring undertaken over recent years by the national regulatory authorities and by the Commission has shown that current transparency requirements and rules on access to infrastructure are not sufficient to secure a genuine well-functioning, open and efficient internal market.
Justification
Clarification of the text.
Amendment  8 Proposal for a regulation – amending act Recital 10
Text proposed by the Commission	Amendment
(10) Equal access to information on the physical status of the system is necessary to enable all market participants to assess the overall demand and supply situation and identify the reasons for movements in the wholesale price. This includes more precise information on electricity generation, supply and demand, network capacity, flows and maintenance, balancing and reserve capacity.	(10) Equal access to information on the physical status and efficiency of the system is necessary to enable all market participants to assess the overall demand and supply situation and identify the reasons for movements in the wholesale price. This includes more precise information on electricity generation, supply and demand, network capacity, flows and maintenance, balancing and reserve capacity.
Amendment  9 Proposal for a regulation – amending act Recital 11
Text proposed by the Commission	Amendment
(11) To enhance trust in the market, its participants need to be sure that abusive behaviour can be sanctioned. Competent authorities should be enabled to effectively investigate allegations of market abuse. Therefore access to data to the competent authorities is necessary that provides information on operational decisions made by supply undertakings. In the electricity market many relevant decisions are made by the generators, who should keep this information available to the competent authorities for fixed period of time. Small generators with no real possibility to distort the market should be exempt from this obligation.	(11) To enhance trust in the market, its participants need to be sure that abusive behaviour can be sanctioned effectively. The competent authorities should be given the competence effectively to investigate allegations of market abuse. Therefore, access by the competent authorities to data that provides information on operational decisions made by supply undertakings is necessary. In the electricity market, many relevant decisions are made by the generators, who should keep that information available to and easily accessible by the competent authorities for a fixed period of time. The competent authorities should, furthermore, regularly monitor the compliance of the transmission system operators with the rules. Small generators with no real ability to distort the market should be exempt from this obligation.
Justification
The Competent authorities should have easy access to important information from supply undertakings and shall monitor that the supply undertakings comply with the rules, in order to ensure a non-discriminatory, transparent and effective market.
Amendment  10 Proposal for a regulation – amending act Recital 12
Text proposed by the Commission	Amendment
(12) Competition for household-consumers requires that suppliers not be blocked when they want to enter new retail markets. Therefore rules and responsibilities governing the supply chain need to be known to all market parties, and they need to be harmonised with a view to enhancing Community market integration.	(12) Competition for household-consumers requires that suppliers not be blocked when they want to enter new retail markets. Therefore rules and responsibilities governing the supply chain need to be known to all market parties, and they need to be harmonised with a view to enhancing Community market integration. The competent authorities should regularly monitor the compliance of market participants with the rules.
Justification
The addition is necessary in order to clarify a responsibility for the Complement authority, and to ensure the enforcement of the rules.
Amendment  11 Proposal for a regulation – amending act Article 1 – point 1 Regulation (EC) No 1228/2003 Article 1
Text proposed by the Commission Amendment This Regulation also aims at facilitating the emergence of well functioning and transparent cross-border retail market and a well functioning and transparent wholesale market. It provides mechanisms to harmonise these rules. This Regulation also aims at facilitating the emergence of a well-functioning and transparent wholesale market with a high level of security of supply. It provides mechanisms to harmonise rules to this effect.
Justification
The provisions on the harmonisation of a retail market for electricity should be deleted or expressed solely in the proposal for a directive amending directive 2003/54/EC concerning common rules for the internal market in electricity (COM/2007/0528 final). The proposal on cross-border exchanges and access to networks (COM 2007-531) should concentrate on wholesale markets and security of supply.
Amendment  12 Proposal for a regulation – amending act Article 1 – point 3 Regulation (EC) No 1228/2003 Article 2a
Text proposed by the Commission Amendment All transmission system operators shall cooperate at Community level through establishing the European Network of Transmission System Operators for Electricity in order to ensure the optimal management and sound technical evolution of the European electricity transmission network. All transmission system operators shall cooperate at Community level through establishing the European Network of Transmission System Operators for Electricity in order to ensure the optimal management and sound technical evolution of the European electricity transmission network and to promote the completion of the internal market for electricity.
Justification
In order to ensure that TSO´s will facilitate market integration, it must be established that promoting market integration is an explicit task of ENTSO.
Amendment  13 Proposal for a regulation – amending act Article 1 – point 3 Regulation (EC) No 1228/2003 Article 2b – paragraph 1
Text proposed by the Commission Amendment 1. By […] at the latest the transmission system operators for electricity shall submit to the Commission and to the Agency the draft of statutes, a list of future members and draft rules of procedure, including the rules of procedure on the consultation of other stakeholders, of the European Network for Transmission System Operators for Electricity to be established. 1. By […] at the latest the transmission system operators for electricity shall submit to the Commission and to the Agency the draft of statutes, a list of future members and draft rules of procedure of the European Network for Transmission System Operators for Electricity to be established.
Justification
Consultation at EU level until now has been a task of ERGEG. This task should be given to the future Agency, which is entrusted with safeguarding the public interest.
Amendment  14 Proposal for a regulation – amending act Article 1 – point 3 Regulation (EC) No 1228/2003 Article 2c
Text proposed by the Commission Amendment 1. The European Network of Transmission System Operators for Electricity shall adopt: 1. In order to achieve the objectives set out in Article 2a, the European Network of Transmission System Operators for Electricity shall agree and submit to the Agency for approval following the procedure provided for in Article 2d in conjunction with Article 6(3) of Regulation (EC) No … establishing the Agency for the Cooperation of Energy Regulators the following: (a) technical and market codes in the areas mentioned in paragraph 3; (a) draft network codes in the areas mentioned in paragraph 3, elaborated in cooperation with market participants and network users; (b) common network operation tools and research plans; (b) common network operation tools and research plans; (c) a 10-year investment plan, including a generation adequacy outlook, every two years; (c) a 10-year investment plan, including a generation adequacy outlook, every two years;   (ca) measures to ensure the real-time coordination of grid operation in normal and emergency conditions;   (cb) guidelines on the coordination of technical cooperation between Community and third-country transmission system operators; (d) an annual work programme; (d) an annual work programme based on the priorities set by the Agency; (e) an annual report; (e) an annual report; (f) annual summer and winter generation adequacy outlooks. (f) annual summer and winter generation adequacy outlooks. 2. The annual work programme referred to in paragraph 1(d) shall contain a list and description of the technical and market codes, a plan on common operation of the network and research and development activities, to be drawn up in that year and an indicative calendar. 2. The annual work programme referred to in paragraph 1(d) shall contain a list and description of the network codes, a plan on common operation of the network and research and development activities, to be drawn up in that year and an indicative calendar. 3. The detailed technical and market codes shall cover the following areas, according to the priorities defined in the annual work programme: 3. The detailed network codes shall cover the following areas, according to the priorities defined in the annual work programme: (a) security and reliability rules; (a) security and reliability rules, including interoperability rules and procedures for emergency situations; (b) grid connection and access rules; (b) grid connection and access rules; (c) data exchange and settlement rules;   (d) interoperability rules;   (e) operational procedures in an emergency;   (f) capacity allocation and congestion management rules; (f) cross-border capacity allocation and congestion management rules; (g) rules for trading;   (h) transparency rules; (h) network-related transparency rules; (i) balancing rules including reserve power rules; (i) balancing and settlement rules including reserve power rules; (j) rules regarding harmonised transportation tariff structures including locational signals and inter-TSO compensation rules; (j) inter-TSO compensation rules; (k) energy efficiency regarding electricity networks. (k) energy efficiency regarding electricity networks. 4. The European Network of Transmission System Operators for Electricity shall monitor the implementation of the technical and market codes and include the results of its monitoring activities in the annual report referred to in paragraph 1(e). 4. The Agency shall monitor the implementation of the codes by the European Network of Transmission System Operators for Electricity 5. The European Network of Transmission System Operators for Electricity shall publish a Community-wide 10-year network investment plan every two years. The investment plan shall include the modelling of the integrated network, scenario development, a generation adequacy report and an assessment of the resilience of the system. The investment plan shall, in particular, build on national investment plans and on the Guidelines for Trans-European energy networks in accordance with Decision No 1364/2006/EC of the European Parliament and of the Council21. The investment plan shall identify investment gaps, notably with respect to cross border capacities. 5. The European Network of Transmission System Operators for Electricity shall publish a Community-wide 10-year network investment plan every two years following its approval by the Agency. The investment plan shall include the modelling of the integrated network, scenario development, a generation adequacy report and an assessment of the resilience of the system. The investment plan shall, in particular, build on national investment plans taking into account regional and Community-wide aspects of network planning, including the Guidelines for Trans-European energy networks in accordance with Decision No 1364/2006/EC of the European Parliament and of the Council. The investment plan shall identify investment gaps, notably with respect to cross-border capacities and shall include investments in interconnection and in other infrastructure necessary for effective trading and competition and for the security of supply. A review of barriers to the increase of cross-border capacity of the network arising from different approval procedures or practices shall be annexed to the investment plan.   The transmission system operators shall implement the published investment plan. 6. Upon request of the Commission, the European Network of Transmission System Operators for Electricity shall advise the Commission on the adoption of Guidelines as laid down in Article 8.     6. The European Network of Transmission System Operators, on its own initiative, may propose to the Agency draft network codes in any area other than those listed in paragraph 3 with a view to achieving the objective set out in Article 2a. The Agency shall subsequently adopt the codes following the procedure set out in Article 2eb (development of codes) while ensuring that those codes are not in contradiction to the guidelines adopted under Article 2ea (development of guidelines).
Amendment  15 Proposal for a regulation – amending act Article 1 – point 3 Regulation (EC) No 1228/2003 Article 2d
Text proposed by the Commission Amendment 1. The Agency shall monitor the execution of the tasks referred to in Article 2c(1) of the European Network of Transmission System Operators for Electricity. 1. The Agency shall monitor the execution of the tasks referred to in Article 2c(1) of the European Network of Transmission System Operators for Electricity. 2. The European Network of Transmission System Operators for Electricity shall submit the draft technical and market codes, the draft 10-year investment plan and the draft annual work programme, including the information regarding the consultation process, to the Agency. 2. The European Network of Transmission System Operators for Electricity shall submit draft network codes and the documents referred to in Article 2c(1) to the Agency for approval. The Agency may provide an opinion to the European Networks of Transmission System Operators for Electricity within 3 months.   The Agency shall provide a duly justified opinion to the Commission where it considers that the draft annual work programme or the draft 10-year investment plan do not ensure non-discrimination, effective competition and the efficient functioning of the market. The Agency shall monitor the implementation of the network codes, the 10-year investment plan and the annual work programme and shall include the results of that monitoring in its annual report. In case of non-compliance by the transmission system operators with the network codes, the 10-year investment plan or the annual work programme of the European Network of Transmission System Operators for Electricity the Agency shall provide information thereof to the Commission.
Amendment  16 Proposal for a regulation – amending act Article 1 – Point 3 Regulation (EC) No 1228/2003 Articles 2 e a and 2 e b
Text proposed by the Commission Amendment Article 2ea Article 2ea Establishment and evaluation of technical and market codes Development of guidelines 1. After consulting the Agency, the Commission may invite the European Network of Transmission System Operators for Electricity, within a reasonable period of time, to prepare codes in the areas listed in Article 2c(3 where it considers that such codes are necessary for the efficient functioning of the market. 1. The Commission shall, after consultation with the Agency, establish an annual priority list identifying issues of primary importance for the development of the internal market in electricity. 2. The Agency shall provide a duly justified opinion to the Commission where it considers that: 2. Having regard to that priority list, the Commission shall mandate the Agency to develop, within no more than six months, draft guidelines establishing basic, clear and objective principles for the harmonisation of rules, as set out in Article 2c. (a) a technical or market code adopted by the European Network of Transmission System Operators for Electricity in the areas listed in Article 2c(3) does not ensure non-discrimination, effective competition and the efficient functioning of the market; 3. In drafting those guidelines, the Agency shall formally consult the European Network of Transmission System Operators for Electricity and other stakeholders, in an open and transparent manner. (b) the European Network of Transmission System Operators for Electricity fails to agree within a reasonable period of time on a technical or market code in the areas listed in Article 2c(3); 4. The Agency shall adopt draft guidelines on the basis of that consultation. It shall specify the observations received during the consultation and explain how they were taken into account. It shall give reasons where observations have not been taken into account. (c) the transmission system operators fail to implement a technical or market code adopted by the European Network of Transmission System Operators for Electricity in the areas listed in Article 2c(3); 5. On its own initiative or at the request of the Agency, the Commission may initiate the same procedure to update the guidelines. 3. The Commission may adopt, on its own initiative or upon recommendation of the Agency, guidelines on the areas listed in Article 2c(3) when it considers that:   (a) a technical or market code adopted by the European Network of Transmission System Operators for Electricity in the areas listed in Article 2c(3) does not ensure non-discrimination, effective competition and the efficient functioning of the market; Article 2eb (b) the European Network of Transmission System Operators for Electricity fails to agree within a reasonable period of time on a technical or market code in the areas listed in Article 2c(3); Development of network codes (c) the transmission system operators fail to implement a technical or market code adopted by the European Network of Transmission System Operators for Electricity in the areas listed in Article 2c(3); 1. Within six months of the adoption of the guidelines by the Agency, in accordance with Article 2ea, the Commission shall mandate the European Network for Transmission System Operators of Electricity to develop draft network codes in full compliance with the principles established in the guidelines. Those measures designed to amend non-essential elements of this Regulation by supplementing it shall be adopted in accordance with the regulatory procedure with scrutiny referred to in Article 13(2). 2. In drafting those codes, the European Network for Transmission System Operators for Electricity shall take into consideration technical expertise from market participants and network users and shall keep them informed of progress. 4. Paragraphs 3 shall be without prejudice to the Commission's right to adopt and amend guidelines as laid down in Article 8. 3. The European Network for Transmission System Operators for Electricity shall submit the draft codes to the Agency.   4. The Agency shall conduct a formal consultation in relation to the draft network codes in an open and transparent manner.   5. The Agency shall adopt the draft codes on the basis of that consultation,. It shall specify the observations received during the consultation and how they were taken into account. It shall give reasons where observations have not been taken into account.   6. On the Agency’s own initiative or at the request of the European Network for Transmission System Operators for Electricity, a revision of the existing codes may be undertaken following the same procedure.   7. In the event that the Commission considers that transmission system operators have failed to implement a network code, it may, on recommendation of the Agency, submit that network code to the Committee referred to in Article 13(1) for its final adoption in accordance with the procedure referred to in Article 13(2);
Amendment  17 Proposal for a regulation – amending act Article 1 – point 3 Regulation (EC) No 1228/2003 Article 2f
Text proposed by the Commission Amendment         1. In carrying out its tasks, the European Network of Transmission System Operators for Electricity shall consult extensively, at an early stage and in an open and transparent manner, in particular while preparing the technical and market codes and its annual work programme referred to in Article 2c(1) and (3), with all appropriate market participants; the consultation shall include supply and generation undertakings, customers, system users, distribution system operators, including relevant (industry) associations, technical bodies and stakeholder platforms. 1. In carrying out its tasks, the Agency shall formally consult, in an open and transparent manner, all appropriate market participants; the consultation shall include supply and generation undertakings, customers, system users, distribution system operators, including relevant (industry) associations, technical bodies and stakeholder platforms. 2. All documents and minutes of meetings related to the issues referred to in paragraph 1 shall be made public. 2. All documents and minutes of meetings related to the issues referred to in paragraph 1 shall be made public. 3. Before adopting the work programme and the technical and market codes referred to in Article 2c(1) and (3), the European Network of Transmission System Operators for Electricity shall indicate the observations received in the consultation and how these observations are taken into consideration. It shall give a reasoned opinion where observations have not been taken into account. 3. Before adopting the guidelines and codes, the Agency shall indicate the observations received in the consultation and how these observations are taken into consideration. It shall give a reasoned opinion where observations have not been taken into account.   3a. The European Network of Transmission System Operators for Electricity shall cooperate with market participants and network users in accordance with Article 2eb(2).
Amendment  18 Proposal for a regulation – amending act Article 1 – point 3 Regulation (EC) No 1228/2003 Article 2g
Text proposed by the Commission Amendment The costs related with the activities of the European Network of Transmission System Operators for Electricity mentioned in Articles 2a to 2h shall be borne by the transmission system operators and shall be taken into account in the calculation of tariffs. The costs related with the activities of the European Network of Transmission System Operators for Electricity mentioned in Articles 2a to 2h shall be borne by the transmission system operators and shall be included in the calculation of tariffs. The Regulatory authorities shall approve those costs only if they are reasonable and proportionate.
Justification
The competencies of the European Network of Transmission System Operators for Electricity should be limited to network related issues. Therefore, Article 2c paragraph 3 subparagraph g should be deleted since rules for trading do not deal with such network related issues.
Amendment  19 Proposal for a regulation – amending act Article 1 – point 3 Regulation (EC) No 1228/2003 Article 2 h
Text proposed by the Commission Amendment 1. Transmission system operators shall establish regional cooperation within the European Network for Transmission System Operators for Electricity to contribute to the tasks mentioned in Article 2c(1). In particular, they shall publish a regional investment plan every two years, and may take investment decisions based on the regional investment plan. 1. Transmission system operators shall establish regional cooperation within the European Network for Transmission System Operators for Electricity to contribute to the tasks mentioned in Article 2c(1). In particular, they shall publish a regional investment plan every two years, and may take investment decisions based on the regional investment plan. The regional investment plan may not be contradictory to the 10 year investment plan referred to in Article 2c(1)(c). The regional investment plan may not be contradictory to the 10 year investment plan referred to in Article 2c(1)(c). 2. Transmission system operators shall promote operational arrangements in order to ensure optimum management of the network, and promote the development of energy exchanges, the allocation of cross-border capacity through implicit auctions and the integration of balancing and reserve power mechanisms. 2. Transmission system operators shall promote operational arrangements in order to ensure optimum management of the network, and, where efficient, promote the development of energy exchanges, the coordinated allocation of cross-border capacity and the compatibility of cross-border balancing mechanisms. 3. The geographical area covered by each regional cooperation structure may be defined by the Commission. That measure, designed to amend non-essential elements of this Regulation by supplementing it, shall be adopted in accordance with the regulatory procedure with scrutiny referred to in Article 13(2).   For that purpose, the Commission may consult the European Network of Transmission System Operators for Electricity and the Agency.
Amendment  20 Proposal for a regulation – amending act Article 1 – point 3 Regulation (EC) No 1228/2003 Article 2h a (new)
Text proposed by the Commission Amendment   Article 2ha   Technical cooperation between Community and third-country transmission system operators   1. Technical cooperation between Community and third-country transmission system operators shall be monitored by the national regulatory authorities;   2. If incompatibilities with the rules and codes adopted by the Agency come to light in the course of such technical cooperation, the national regulatory authority shall seek clarification from the Agency.
Justification
The regulation does not stipulate how cooperation with third-country TSOs at a technical level will be carried out.
Amendment  21 Proposal for a regulation – amending act Article 1 – point 4 Regulation (EC) No 1228/2003 Article 5 – paragraph 6
Text proposed by the Commission Amendment 6. Generation companies which own or operate generation assets, of which one has an installed capacity of at least 250 MW, shall keep at the disposal of the national regulatory authority, the national competition authority and the Commission, for five years all hourly data per plant that is necessary to verify all operational dispatching decisions and the bidding behaviour at power exchanges, interconnection auctions, reserve markets and OTC markets. The per plant and per hour information to be stored includes, but is not limited to, data on available generation capacity and committed reserves, including allocation of these committed reserves on a per plant level, at the time the bidding is carried out and when production takes place. 6. Generation companies which own or operate generation assets, of which one has an installed capacity of at least 250 MW, shall keep at the disposal of the national regulatory authority, the national competition authority, the Agency and the Commission, for five years all hourly data per plant that is necessary to verify all operational dispatching decisions and the bidding behaviour at power exchanges, interconnection auctions, reserve markets and OTC markets. The per plant and per hour information to be stored includes, but is not limited to, data on available generation capacity and committed reserves, including allocation of these committed reserves on a per plant level, at the time the bidding is carried out and when production takes place.
Amendment  22 Proposal for a regulation – amending act Article 1 – point 4 a (new) Regulation (EC) No 1228/2003 Article 6 – paragraph 1
Text proposed by the Commission Amendment   (4a) In Article 6(1), the following subparagraphs shall be added:   "The regulatory authorities shall monitor congestion management within national electricity systems and interconnectors.   Transmission system operators shall submit their congestion management procedures including capacity allocation for approval to the regulatory authorities. The regulatory authorities may request amendments to those procedures before approving them.".
(Amends existing Article 6, paragraph 1 of Regulation 1228/2003 by adding 2 new subparagraphs)
Justification
The formal approval of congestion management procedures by regulators should be clearly stated in the Regulation 1228/2003 in order to ensure an efficient implementation.
Amendment  23 Proposal for a regulation – amending act Article 1 – point 5 Regulation (EC) No 1228/2003 Article 6 – paragraph 6
Text proposed by the Commission Amendment 6. Any revenues resulting from the allocation of interconnection shall be used for the following purposes in the order of priority: 6. Any revenue resulting from the allocation of interconnection shall be used for the following purposes : (a) guaranteeing the actual availability of the allocated capacity; (a) guaranteeing the actual availability of the allocated capacity; (b) network investments maintaining or increasing interconnection capacities; (b) network investments maintaining or increasing interconnection capacities; If the revenue cannot be used for the purposes set out in points (a) or (b) of the first subparagraph, the revenue shall be placed on a separate account until such time as it can be spent on those purposes. In the case of an independent system operator any income remaining after applying points (a) and (b) shall be held by the Independent System Operator on a separate account until such time as it can be spent on the purposes set out in the points (a) and (b) of the first subparagraph. If the revenue cannot be used for the purposes set out in points (a) or (b) of the first subparagraph, the revenue shall be placed on a separate account until such time as it can be spent on those purposes. In that case, the regulatory authorities, with the approval of the Agency, may take the amount available into account when approving the methodology for calculating the network tariffs, in assessing whether tariffs should be modified, and/or in deciding whether to set up local signals and/or demand-side measures such as load-shifting or counter-trading.
Amendment  24 Proposal for a regulation – amending act Article 1 – point 6 Regulation (EC) No 1228/2003 Article 7 – paragraph 1 – introductory part
Text proposed by the Commission Amendment 1. New direct current interconnectors between Member States may, upon request, be exempted, for a limited period of time, from the provisions of Article 6(6) of this Regulation and Articles 8, 20 and 23(2), (3) and (4) of Directive 2003/54/EC under the following conditions: 1. New direct current interconnectors between Member States may, upon request, be exempted, for a limited period of time, from the provisions of Article 6(6) of this Regulation and Articles 8, 10, 20 and Article 22c(4), (5) and (6) of Directive 2003/54/EC under the following conditions:
Justification
The current version of EC’s proposals encompasses extension of the exemption provisions to the newly proposed art. 8 of the Electricity Directive on ownership unbundling. In order to ensure a flawless interpretation of the norm, extension of the exemption to Art. 10 (which disciplines the ISO-option for transmission systems subject to ownership unbundling) has to be clarified.
References to Articles of the Electricity Directive are adapted to revised Directive 2003/54/EC.
Amendment  25 Proposal for a regulation – amending act Article 1 – point 6 Regulation (EC) No 1228/2003 Article 7 – paragraph 6 – subparagraph 4
Text proposed by the Commission Amendment The Commission’s approval of an exemption decision shall lose its effect after two years from its adoption if construction of the interconnector has not yet started, and after five years if the interconnector has not become operational. The Commission’s approval of an exemption decision shall lose its effect after two years from its adoption if construction of the interconnector has not yet started, and after five years if the interconnector has not become operational, unless the Commission decides that any delay is due to major administrative obstacles or any other cause relevant to the decision but not within the control by the applicant.
Amendment  26 Proposal for a regulation – amending act Article 1 – point 6 Regulation (EC) No 1228/2003 Article 7 – paragraph 7
Text proposed by the Commission Amendment 7. The Commission may adopt guidelines for the application of the conditions mentioned in paragraph 1 and to set out the procedure to be followed for the application of paragraphs 4 and 5. This measure designed to amend non-essential elements of this Regulation by supplementing it shall be adopted in accordance with the regulatory procedure with scrutiny referred to in Article 13(2). 7. The Commission may amend existing guidelines for the application of the conditions mentioned in paragraph 1 and to set out the procedure to be followed for the application of paragraphs 4 and 5. This measure designed to amend non-essential elements of this Regulation by supplementing it shall be adopted in accordance with the regulatory procedure with scrutiny referred to in Article 13(2).
Amendment  27 Proposal for a regulation – amending act Article 1 – point 6 Regulation (EC) No 1228/2003 Article 7 – paragraph 7 a (new)
Text proposed by the Commission Amendment   7a. Derogations granted pursuant Article 7 of Regulation (EC) No 1228/2003 and applicable at the date of entry into force of this Regulation shall automatically continue to apply as derogations granted under of this Regulation.
Amendment  28 Proposal for a regulation – amending act Article 1 – point 6 a (new) Regulation (EC) No 1228/2003 Article 7-a (new)
Text proposed by the Commission Amendment   (6a) The following Article 7-a shall be inserted:   "Article 7-a   Removal of administrative barriers to increase capacity   Member States shall review their procedures with the aim of identifying and removing any administrative barriers to increasing the amount of interconnection capacity. Member States shall identify the grid segments that need to be reinforced in order to increase the overall level of cross-border interconnection capacity in line with the objective of broad market integration."
Amendment  29 Proposal for a regulation – amending act Article 1 – point 7 Regulation (EC) No 1228/2003 Article 7 a
Text proposed by the Commission Amendment In order to facilitate the emergence of well functioning and transparent cross border retail markets on a regional and Community scale, Member States shall ensure that the roles and responsibilities of transmission system operators, distribution system operators, supply undertakings and customers and if necessary other market participants are defined with respect to contractual arrangements, commitment to customers, data exchange and settlement rules, data ownership and metering responsibility. In order to facilitate the emergence of well-functioning, effective and transparent markets on a regional and Community scale, Member States shall ensure that the roles and responsibilities of transmission system operators, distribution system operators, supply undertakings and customers and if necessary other market participants are defined in detail with respect to contractual arrangements, commitment to customers, data exchange and settlement rules, data ownership and metering responsibility. These rules shall be made public, be designed with the aim of harmonising access to customers across borders and be subject to review by the regulatory authorities. Those rules shall be made public and shall be subject to review by the regulatory authorities.
Justification
The objective of harmonised cross border retail markets is not necessary for the development of well functioning regional and Community wholesale markets, which should remain the priority. The implications of such a regulatory objective need to be fully assessed, and the costs and benefits carefully analysed, since it is probable there would be significant stranded costs, outweighing the benefits.
Amendment  30 Proposal for a regulation – amending act Article 1 – point 8 Regulation (EC) No 1228/2003 Article 8
Text proposed by the Commission Amendment Guidelines Guidelines relating to inter-transmission system operator compensation mechanisms 1. Where appropriate, guidelines relating to the inter-transmission system operator compensation mechanism shall specify, in accordance with the principles set out in Articles 3 and 4: 1. Where appropriate, the Commission may adopt guidelines relating to the inter-transmission system operator compensation mechanism that shall specify, in accordance with the principles set out in Articles 3 and 4: (a) details of the procedure for determining which transmission system operators are liable to pay compensation for cross-border flows including as regards the split between the operators of national transmission systems from which cross-border flows originate and the systems where those flows end, in accordance with Article 3(2); (a) details of the procedure for determining which transmission system operators are liable to pay compensation for cross-border flows including as regards the split between the operators of national transmission systems from which cross-border flows originate and the systems where those flows end, in accordance with Article 3(2); (b) details of the payment procedure to be followed, including the determination of the first period of time for which compensation is to be paid, in accordance with the second subparagraph of Article 3(3); (b) details of the payment procedure to be followed, including the determination of the first period of time for which compensation is to be paid, in accordance with the second subparagraph of Article 3(3); (c) details of methodologies for determining the cross-border flows hosted for which compensation is to be paid under Article 3, in terms of both quantity and type of flows, and the designation of the magnitudes of such flows as originating and/or ending in transmission systems of individual Member States, in accordance with Article 3(5); (c) details of methodologies for determining the cross-border flows hosted for which compensation is to be paid under Article 3, in terms of both quantity and type of flows, and the designation of the magnitudes of such flows as originating and/or ending in transmission systems of individual Member States, in accordance with Article 3(5); (d) details of the methodology for determining the costs and benefits incurred as a result of hosting cross-border flows, in accordance with Article 3(6); (d) details of the methodology for determining the costs and benefits incurred as a result of hosting cross-border flows, in accordance with Article 3(6); (e) details of the treatment in the context of the inter-TSO compensation mechanism of electricity flows originating or ending in countries outside the European Economic Area; (e) details of the treatment in the context of the inter-TSO compensation mechanism of electricity flows originating or ending in countries outside the European Economic Area; (f) the participation of national systems which are interconnected through direct current lines, in accordance with Article 3. (f) the participation of national systems which are interconnected through direct current lines, in accordance with Article 3. 2. Guidelines may also determine appropriate rules leading to a progressive harmonisation of the underlying principles for the setting of charges applied to producers and consumers (load) under national tariff systems, including the reflection of the inter-TSO compensation mechanism in national network charges and the provision of appropriate and efficient locational signals, in accordance with the principles set out in Article 4. 2. Guidelines on inter-transmission system operator compensation mechanisms may also determine appropriate rules leading to a progressive harmonisation of the underlying principles for the setting of charges applied to producers and consumers (load) under national tariff systems, including the reflection of the inter-TSO compensation mechanism in national network charges and the provision of appropriate and efficient locational signals, in accordance with the principles set out in Article 4. The guidelines shall make provision for appropriate and efficient harmonised locational signals at European level. The guidelines on inter-transmission system operator compensation mechanisms shall make provision for appropriate and efficient harmonised locational signals at European level. Any harmonisation in this respect shall not prevent Member States from applying mechanisms to ensure that network access charges borne by consumers (load) are comparable throughout their territory. Any harmonisation in this respect shall not prevent Member States from applying mechanisms to ensure that network access charges borne by consumers (load) are comparable throughout their territory. 3. Where appropriate, guidelines providing the minimum degree of harmonisation required to achieve the aim of this Regulation shall also specify: 3. Where appropriate, the Commission may propose additional guidance providing the minimum degree of harmonisation required to achieve the aim of this Regulation. (a) details on provision of information, in accordance with the principles set out in Article 5;   (b) details on the retail market issues covered by Article 7a;   (c) details of connection rules governing the relation between the transmission system operators and connected customers;   (d) details of rules for interoperability;   (e) details of rules for the trading of electricity;   (f) details of balancing and reserve power rules aiming at further integration of the balancing and reserve power markets;   (g) details of investment incentive rules including locational signals;   (h) details on the topics listed in Article 2c(3).   4. Guidelines on the management and allocation of available transfer capacity of interconnections between national systems are laid down in the Annex. 4. Guidelines on the management and allocation of available transfer capacity of interconnections between national systems are laid down in the Annex. 5. The Commission may adopt guidelines on the issues listed in paragraphs 1 to 3. It may amend the guidelines referred to in paragraph 4, in accordance with the principles set out in Articles 5 and 6, in particular so as to include detailed guidelines on all capacity allocation methodologies applied in practice and to ensure that congestion management mechanisms evolve in a manner compatible with the objectives of the internal market. Where appropriate, in the course of such amendments common rules on minimum safety and operational standards for the use and operation of the network, as referred to in Article 5(2) shall be set.Those measures designed to amend non-essential elements of this Regulation inter alia by supplementing it shall be adopted in accordance with the regulatory procedure with scrutiny referred to in Article 13(2).   When adopting or amending guidelines, the Commission shall ensure that they provide the minimum degree of harmonisation required to achieve the aims of this Regulation and do not go beyond what is necessary for that purpose.   When adopting or amending guidelines, the Commission shall indicate what actions it has taken with respect to the conformity of rules in third countries, which form part of the European electricity system, with the guidelines in question.   When adopting these guidelines for the first time the Commission shall ensure that they cover in a single draft measure at least the issues referred to in paragraph 1(a) and (d), and paragraph 2."
Amendment  31 Proposal for a regulation – amending act Article 1 – point 8 a (new) Regulation (EC) No 1228/2003 Article 12 – paragraph 1
Text proposed by the Commission Amendment   (8a) Article 12(1) shall be replaced by the following:   1. Without prejudice to paragraph 2, the Member States shall ensure that national regulatory authorities have the competence effectively to ensure compliance with this Regulation by providing them, or other bodies, with the legal competence to issue compliance orders and to impose effective, dissuasive and proportionate penalties. The Member States shall notify those provisions to the Commission by 1January 2010 at the latest and shall notify the Commission without delay of any subsequent amendment affecting them.
(Changes wording of paragraph 1, article 12 of Regulation (EC) 1228/2003)
Justification
According to the Council of European Energy Regulators, the current state of implementation of Regulation 1228/2003 shows shortcomings because of missing effective sanctions implemented by Member States. Effective use of the enforcement powers of regulators should be ensured in order to sanction non-compliance with requirements of the Regulation.

EXPLANATORY STATEMENT

Introduction

1.  The Rapporteur welcomes the third liberalisation package for the European Union’s energy markets as it offers, in his opinion, a complete and coherent legislative proposal in which the majority of the recommendations adopted by the European Parliament in June 2007 have been included in the proposals.

2.  In this sense, he agrees with the inclusion of stronger and more independent powers for the regulators, the increased requirements for transparency in the market, the improved framework for cooperation at European level between national regulators as well as between Transmission Systems Operators, the emphasis given to the further development of interconnection capacity between Member States and the proposal of ownership unbundling as the most effective, but not the only, mean to encourage investments and avoid discrimination towards new entrants.

3.  He also shares the proposed creation of an Agency of European Regulators although he has reservations on the present structure and decision-making power of this new body.

4.  Regarding the Regulation on the electricity cross-border exchanges, the Rapporteur thinks that the main problem with the legislative proposal lies in the current division of competences between the different actors which leads to a confused and somehow cumbersome decision-making process. This document will highlight the main concerns of the Rapporteur with regards to this particular proposal.

Structure of responsibilities

5.  As stated above, the Rapporteur considers that the key problem in this dossier is that the current structure of responsibilities presented in the Commission’s proposal for a Regulation on the electricity cross-border exchanges does not correspond to the actual and natural division of competences at national level as the Transmission System Operators are given a quasi-regulatory status while the Regulatory Agency seems to be reduced to the role of an advisory body.

6.  In particular, he believes that several of the eleven tasks that Transmission System Operators (TSOs) have to fulfil should be in the hands of the regulatory authorities instead.

7.  Indeed, while the Rapporteur shares the Commission’s idea of establishing a bottom-up approach in what regards the development of technical codes since the TSOs are best suited to do so and have a direct interest in simplifying and harmonising such rules at European level, he believes that other codes such as those relating to trading and market transparency should follow a different approach where the Agency, as an independent authority, should be responsible for drafting the guidelines in close cooperation with market participants and, needless to say, TSOs, and for adopting them.

8.  Furthermore, the voluntary nature of the implementation of the above mentioned codes and rules raises some questions as to whether there is any added value to the current system of TSO cooperation at European level. The Rapporteur firmly believes that some rules and codes that will derive from the implementation of this Regulation should have a compulsory nature.

9.  Finally, the Rapporteur thinks that, in line with the attribution to the Agency of drafting and adopting market codes, this regulatory authority should be in charge of carrying out the stakeholder consultation instead of the TSOs, according to the process carried out at national level.

The Agency

10.  The Rapporteur is aware of the limitations the Commission’s legal service opinion has placed on the powers given to the Agency of European Regulators. However, he is of the opinion that most of the uncertainties and confusion in the structure of powers derives precisely from this lack of competences. For this reason, the Rapporteur would like the Committee to ask the Parliament’s legal service to study whether the Agency’s powers could be extended to be able to deliver final regulatory decisions, in accordance with the European Parliament’s resolution of June 2007 on the liberalisation of the energy markets.

11.  Should that not be possible, then the Rapporteur believes that Parliament should reflect on whether the proposed model would answer the problems to reach a common view that arise at present between national regulators and if it could be acceptable as an intermediary step towards a true European Regulator.

12.  The European Parliament expressed in the recent past its wish to establish a European body of national regulators that would be granted decision-making powers for cross-border issues between Member States while the national regulators would remain responsible for decisions of matters within their national territory. The Parliament's position intended to put an end to the situations of deadlock between national regulators we see at the present time; that is why the Commission's proposal as it stands today does give the Agency the competence of solving this current and potential difficulties. The Rapporteur believes that an independent Agency, with the adequate competences for cross border issues, would promote the development of a true EU energy regulation, more efficiently and with more transparency.

13.  The Rapporteur is also concerned by the dissolution of the existing ERGEG and the implications it might have in terms of independence since the Agency as currently proposed will be excessively dependent on the European Commission.

Unbundling requirements under the European Network of Transmission System Operators

14.  The Rapporteur welcomes the Commission’s proposal to formalise the existing cooperation framework of Transmission System Operators so as to promote integration at European level and to develop full harmonisation of technical rules between the 27 Member States.

15.  In order to make the ENTSO model work properly, and regardless of the level of unbundling required in each Member State – that is, unbundled TSO or ISO -, the Rapporteur believes that every Transmission System Operator within ENTSO should be treated equally in what concerns their obligations as system operator and in ensuring non-discriminatory access to the grid.

Investments

16.  The Commission’s proposals for the presentation of a 10 year investment plan by TSOs is in accord with already existing obligations at Member State level, so the Rapporteur welcomes the objective of adding a European dimension to it, in particular regarding the upgrading and improvement of transmission capacity between Member States.

17.  However, it is important that this plan is adopted by the regulatory body and not just submitted for review.

Transparency

18.  The Rapporteur is convinced that rules on transparency should be developed, in consultation with the TSOs, by the regulatory body and not only reviewed by the Agency. While he welcomes the development of guidelines at EU level, he would prefer to see these guidelines become binding on the most important elements.

19.  He would also like to point out that in some parts of the Regulation, transparency seems to be mistaken with monitoring and reporting, so he would like to differentiate these parts accordingly in his report.

Harmonisation

20.  The Rapporteur believes that harmonisation is not being put at the forefront of the proposal. The existence of 27 different regulatory frameworks is one of the main obstacles to integration of the energy markets. Therefore, the Rapporteur believes that the voluntary nature of the harmonisation of technical and market rules will not be sufficient to overcome the existing barriers to cross-border trade between Member States derived from insufficient integration. For this reason, he thinks that harmonisation of technical codes as well as of the regulatory framework should be one of the core objectives of the package.

Regional markets

21.  The Rapporteur welcomes the inclusion in the Regulations and Directives of the development of regional markets as a positive step towards integration. Indeed, the recent progress in this field, as well as already well established ones such as the Nordic market, could provide a solid basis to compare different models and to possibly extrapolate some of these experiences at an EU level.

Interconnection levels

22.  The Rapporteur welcomes the appointment of special Coordinators to speed the development of the main four interconnection projects between Member States that have been stalling. He believes that they can have a positive influence in speeding up these processes by mediating between all actors and interested parties.

23.  However, these individual cases, while important in nature, are only a small part of the problem and many political, technical and administrative obstacles still remain throughout the European Union to increasing interconnection capacity between Member States even where these projects are economically and technically viable.

OPINION of the Committee on Economic and Monetary Affairs (8.5.2008)

for the Committee on Industry, Research and Energy

on the proposal for a regulation of the European Parliament and of the Council amending Regulation (EC) No 1228/2003 on conditions for access to the network for cross-border exchanges in electricity
(COM(2007)0531 – C6‑0320/2007 – 2007/0198(COD))

Draftswoman: Mariela Velichkova Baeva

SHORT JUSTIFICATION

The proposal of the European Commission for a third legislative liberalization energy package focuses on the integration and completion of a competitive, transparent, solidarity-based and non-discriminatory single EU energy market. To achieve these goals all impediments should be approached with due care and by all stakeholders and be removed to speed up the process of integration and harmonization.

The concepts of Ownership Unbundling and Independent System Operator as an alternative are supposed to contribute to a better environment for competition and reduction of energy prices as well as easier entrance of new players on the market – this complex of factors being crucial for the benefit of consumers and economies. Solutions should be elaborated taking into consideration the availability of the current legal frameworks of 27 Member States and the obstacles stemming from this status-quo and should be based on empirically verifiable data. Vital options should furthermore be promoted for enhancing regional cooperation and investment estimations and planning. For the optimal use of the infrastructure and interconnection capacity it has to be taken into account that in some cases further network investment considerably depends on previous investment portfolio.

The proposal for a regulation of competitive energy markets should be more balanced in terms of non-infringement of the fundamental market principles and not turn out to be counter-productive and damage market liquidity as well as investment intentions. The control mechanisms are already in place considering the competition law that has been enacted by the authorities on a national and European level. The power of the regulators should be to an extent of non-intervention in market mechanisms and provide for effective control of the costs of the enterprises for the benefit of consumers. Reporting of the companies might be beneficial to further market development as well and ensure transparency.

Rules are needed for the cooperation among the national regulators and the harmonization of their powers as well as enhanced independence on a national level.

The restructuring of the energy market on a national level envisages full independence and autonomy of Transmission System Operators (TSOs) as an aspect of the process thus ensuring the free and non-discriminatory access to the grid of all market participants. Equal treatment of publicly and privately held TSOs is of considerable importance.

Furthermore, a stronger TSO cooperation is needed in the framework of the European Network of Transmission System Operators (ENTSO). The expansion or improvement of cross-border infrastructure as well as further integration of the European energy markets might be achieved via such an appropriate base for coordination of current and future network investments to make regional markets more coherent.

It has to be taken into consideration that the income from congestion management is predominately used to reduce national tariffs. Presumably, any change of this procedure might result in grid tariffs jumping up.

An important focus of decision-making should be the fact that there is a fundamental lack of allocation of generation capacity all over Europe. If a clever allocation scheme for generation is devised, financial resources might be saved from directing them to strengthen the grid. Congestions might be solved, and national economies might enjoy a more viable development.

AMENDMENTS

The Committee on Economic and Monetary Affairs calls on the Committee on Industry, Research and Energy, as the committee responsible, to incorporate the following amendments in its report:

Text proposed by the Commission[1]	Amendments by Parliament
Amendment 1 Proposal for a regulation – amending act Article 1 – point 3 Regulation (EC) No 1228/2003 Article 2c – paragraph 1 – introductory part
Text proposed by the Commission Amendment 1. The European Network of Transmission System Operators for Electricity shall adopt: 1. The European Network of Transmission System Operators for Electricity shall:
Justification
The Directive gives too broad powers to ENTSO in providing that it adopts technical and market codes. However before adopting them, extensive consultations have to be conducted to ensure that the positions of Market Stakeholders are duly taken into consideration.
Amendment 2 Proposal for a regulation – amending act Article 1 – point 3 Regulation (EC) No 1228/2003 Article 2c – paragraph 1 – point (a)
Text proposed by the Commission Amendment (a) technical and market codes in the areas mentioned in paragraph 3; (a) prepare and propose the technical and market codes in the areas mentioned in paragraph 3, following consultation of the relevant stakeholders;
Justification
The Directive gives too broad powers to ENTSO in providing that it adopts technical and market codes. However before adopting them, extensive consultations have to be conducted to ensure that the positions of Market Stakeholders are duly taken into consideration.
Amendment 3 Proposal for a regulation – amending act Article 1 – point 3 Regulation (EC) No 1228/2003 Article 2c – paragraph 1 – point (b)
Text proposed by the Commission Amendment (b) common network operation tools and research plans; (b) adopt common network operation tools and research plans;
Justification
The Directive gives too broad powers to ENTSO in providing that it adopts technical and market codes. However before adopting them, extensive consultations have to be conducted to ensure that the positions of Market Stakeholders are duly taken into consideration.
Amendment 4 Proposal for a regulation – amending act Article 1 – point 3 Regulation (EC) No 1228/2003 Article 2c – paragraph 1 – point (c)
Text proposed by the Commission Amendment (c) a 10-year investment plan, including a generation adequacy outlook, every two years; (c) adopt and publish a 10-year investment plan, including a generation adequacy outlook, every two years;
Justification
The Directive gives too broad powers to ENTSO in providing that it adopts technical and market codes. However before adopting them, extensive consultations have to be conducted to ensure that the positions of Market Stakeholders are duly taken into consideration.
Amendment  5 Proposal for a regulation – amending act Article 1 – point 3 Regulation (EC) No 1228/2003 Article 2c – paragraph 1 – point (d)
Text proposed by the Commission Amendment (d) an annual work programme; (d) adopt an annual work programme;
Amendment  6 Proposal for a regulation – amending act Article 1 – point 3 Regulation (EC) No 1228/2003 Article 2c – paragraph 1 – point (e)
Text proposed by the Commission Amendment (e) an annual report; (e) adopt an annual report;
Amendment  7 Proposal for a regulation – amending act Article 1 – point 3 Regulation (EC) No 1228/2003 Article 2c – paragraph 1 – point (f)
Text proposed by the Commission Amendment (f) annual summer and winter generation adequacy outlooks. (f) adopt annual summer and winter generation adequacy outlooks.
Amendment 8 Proposal for a regulation – amending act Article 1 – point 3 Regulation (EC) No 1228/2003 Article 2c – paragraph 3 – point (g)
Text proposed by the Commission Amendment (g) rules for trading; (g) adopt rules for trading as far as the grid is concerned;
Justification
It is not the task of ENTSO to develop e.g. standardised trading contracts.
Amendment 9 Proposal for a regulation – amending act Article 1 – point 3 Regulation (EC) No 1228/2003 Article 2c – paragraph 5
Text proposed by the Commission Amendment 5. The European Network of Transmission System Operators for Electricity shall publish a Community-wide 10-year network investment plan every two years. The investment plan shall include the modelling of the integrated network, scenario development, a generation adequacy report and an assessment of the resilience of the system. The investment plan shall, in particular, build on national investment plans and on the Guidelines for Trans-European energy networks in accordance with Decision No 1364/2006/EC of the European Parliament and of the Council . The investment plan shall identify investment gaps, notably with respect to cross border capacities. 5. The European Network of Transmission System Operators for Electricity shall publish a Community-wide 10-year network investment plan every two years. The investment plan shall include the modelling of the integrated network, scenario development, a generation adequacy report and an assessment of the resilience of the system. The investment plan shall, at least, build on national investment plans, on regional investment plans pursuant to Article 2h(1) and on the Guidelines for Trans-European energy networks in accordance with Decision No 1364/2006/EC of the European Parliament and of the Council. The investment plan shall identify investment gaps, notably with respect to cross border capacities.
Justification
The Community-wide 10-year network investment plan to be published by ENTSO should include the regional dimension of the market.
Amendment  10 Proposal for a regulation – amending act Article 1 – point 3 Regulation (EC) No 1228/2003 Article 2e – paragraph 1
Text proposed by the Commission Amendment 1. After consulting the Agency, the Commission may invite the European Network of Transmission System Operators for Electricity, within a reasonable period of time, to prepare codes in the areas listed in Article 2c(3) where it considers that such codes are necessary for the efficient functioning of the market. 1. On advice of the Agency, which will have consulted relevant stakeholders, the Commission shall draw up strategic guidelines for the European Network of Transmission System Operators for Electricity covering the issues listed in Article 2c(1)(c) and Article 2c(3), from which the European Network of Transmission System Operators for Electricity will prepare codes in the areas listed in Article 2c(1)(c) and Article 2c(3).
Justification
In the interests of competition (to ensure non-discrimination, effective competition and the efficient functioning of the single market), the Agency should be given more power to regulate ENTSO. To achieve this aim, the Agency should provide formal advice to the Commission at the beginning of the regulatory process in the form of strategic guidelines, on which the ENTSO may prepare technical codes. This process will avoid the possibility of the TSOs being self-regulated. The same process should also apply for the 10-year investment plan (Article 2c(1c)).
Amendment  11 Proposal for a regulation – amending act Article 1 – point 3 Regulation (EC) No 1228/2003 Article 2e – paragraph 1 a (new)
Text proposed by the Commission Amendment   (1a) The European Network of Transmission System Operators for Electricity shall develop the detailed codes pursuant to paragraph 1, and submit these for approval to the Agency.
Justification
In the interests of competition (to ensure non-discrimination, effective competition and the efficient functioning of the single market), the Agency should be given more power to regulate ENTSO. To achieve this aim, the Agency should provide formal advice to the Commission at the beginning of the regulatory process in the form of strategic guidelines, on which the ENTSO may prepare technical codes. This process will avoid the possibility of the TSOs being self-regulated. The same process should also apply for the 10-year investment plan (Article 2c(1c)).
Amendment  12 Proposal for a regulation – amending act Article 1 – point 3 Regulation (EC) No 1228/2003 Article 2e – paragraph 1 b (new)
Text proposed by the Commission Amendment   (1b) The Agency shall verify that the codes submitted by the European Network of Transmission System Operators for Electricity are in line with the strategic guidelines set out in paragraph 1.
Justification
In the interests of competition (to ensure non-discrimination, effective competition and the efficient functioning of the single market), the Agency should be given more power to regulate ENTSO. To achieve this aim, the Agency should provide formal advice to the Commission at the beginning of the regulatory process in the form of strategic guidelines, on which the ENTSO may prepare technical codes. This process will avoid the possibility of the TSOs being self-regulated. The same process should also apply for the 10-year investment plan (Article 2c(1c)).
Amendment  13 Proposal for a regulation – amending act Article 1 – point 3 Regulation (EC) No 1228/2003 Article 2e – paragraph 3 a (new)
Text proposed by the Commission Amendment   (3a) The Agency shall monitor the implementation of such codes by the European Network of Transmission System Operators for Electricity and report any contravention to the Commission, which shall take the necessary action to ensure correct implementation.
Justification
The proposed Directive gives too much power to ENTSO.. The monitoring of the above mentioned codes need to be fair and objective, to ensure non-discrimination, effective competition and the efficient functioning of the market. Therefore, it cannot be entrusted to the TSOs themselves but should constitute a task of the Agency.
Amendment  14 Proposal for a regulation – amending act Article 1 – point 3 Regulation (EC) No 1228/2003 Article 2h – paragraph 1 – subparagraph 1
Text proposed by the Commission Amendment 1. Transmission system operators shall establish regional cooperation within the European Network for Transmission System Operators for Electricity to contribute to the tasks mentioned in Article 2c(1). In particular, they shall publish a regional investment plan every two years, and may take investment decisions based on the regional investment plan. 1. Transmission system operators shall establish regional cooperation within the European Network for Transmission System Operators for Electricity to contribute to the tasks mentioned in article 2c(1). In particular, they shall provide information on their development plans, submit them for consideration to the Agency, publish a regional investment plan every two years, and may take investment decisions based on the regional investment plan.
Justification
For proper unbundling, Transport System Operators should be able to take investment decisions. For a functional energy market, coordination should be ensured at the European level.
Amendment 15 Proposal for a regulation – amending act Article 1 – point 3 Regulation (EC) No 1228/2003 Article 2h – paragraph 2
Text proposed by the Commission Amendment 2. Transmission system operators shall promote operational arrangements in order to ensure optimum management of the network, and promote the development of energy exchanges, the allocation of cross-border capacity through implicit auctions and the integration of balancing and reserve power mechanisms. 2. Transmission system operators shall promote common services and operational arrangements in order to ease the proper functioning and ensure optimum management of the network, and promote the development of energy exchanges, the allocation of cross-border capacity as well as future electricity exports through implicit and explicit auctions open to all eligible market players and the integration of balancing and reserve power mechanisms.
Justification
Access to interconnection capacity should be optimized via yearly, monthly and daily capacity tenders on borders. This should be done in order to tackle the limitations due to high transit flows through the interconnections.
Amendment 16 Proposal for a regulation – amending act Article 1 – point 3 Regulation (EC) No 1228/2003 Article 2h – paragraph 3 – subparagraph 1
Text proposed by the Commission Amendment 3. The geographical area covered by each regional cooperation structure may be defined by the Commission. That measure, designed to amend non-essential elements of this Regulation by supplementing it, shall be adopted in accordance with the regulatory procedure with scrutiny referred to in Article 13(2). 3. Regional cooperation should not be limited to the geographical area covered by each regional cooperation structure defined by the Commission. That measure, designed to amend non-essential elements of this Regulation by supplementing it, shall be adopted in accordance with the regulatory procedure with scrutiny referred to in Article 13(2).
Justification
Access to interconnection capacity should be optimized via yearly, monthly and daily capacity tenders on borders. This should be done in order to tackle the limitations due to high transit flows through the interconnections. Limiting the geographical scope might set barriers to free electricity trade within the sought-for integrated electricity market.
Amendment 17 Proposal for a regulation – amending act Article 1 – point 4 – point (b) Regulation (EC) No 1228/2003 Article 5 – paragraph 4
Text proposed by the Commission Amendment 4. Transmission system operators shall publish relevant data on forecast and actual demand, on availability and actual use of generation and load assets, on availability and use of the network and interconnectors, and on balancing power and reserve capacity. 4. Transmission system operators shall publish relevant data on forecast and actual demand, on availability and actual use of generation and load assets, on availability and use of the network and interconnectors, and on balancing power and reserve capacity. However, individual data concerning generators and loads shall be kept confidential. Data relating to the transmission grid shall not be published if the protection of Critical Infrastructure so requires. Information shall be communicated at Community level to be used (only) for the purpose of ensuring the coordinated and effective protection of critical infrastructure.
Justification
It is practically impossible to keep all information needed to verify all operational dispatching decisions and bidding behaviour at power exchanges. Furthermore, the proposed provision would treat generation companies and independent traders differently in requesting only from generation companies to keep at the disposal of regulators necessary information for the verification of their bidding behaviour and of operational dispatching decisions. This asymmetric treatment does not appear to be justified. Confidentiality of restricted information has to be considered.
Amendment 18 Proposal for a regulation – amending act Article 1 – point 4 – point (b) Regulation (EC) No 1228/2003 Article 5 – paragraph 6
Text proposed by the Commission Amendment 6. Generation companies which own or operate generation assets, of which one has an installed capacity of at least 250 MW, shall keep at the disposal of the national regulatory authority, the national competition authority and the Commission, for five years all hourly data per plant that is necessary to verify all operational dispatching decisions and the bidding behaviour at power exchanges, interconnection auctions, reserve markets and OTC markets. The per plant and per hour information to be stored includes, but is not limited to, data on available generation capacity and committed reserves, including allocation of these committed reserves on a per plant level, at the time the bidding is carried out and when production takes place. 6. Generation companies which own or operate generation assets, of which one has an installed capacity of at least 250 MW, shall keep at the disposal of the national regulatory authority, the national competition authority and the Commission, for five years all hourly data for all plants which have an installed capacity of at least 250 MWe. The per plant and per hour information to be stored includes data on available generation capacity and committed reserves.
Justification
It is practically impossible to keep all information needed to verify all operational dispatching decisions and bidding behaviour at power exchanges. Furthermore, the proposed provision would treat generation companies and independent traders differently in requesting only from generation companies to keep at the disposal of regulators necessary information for the verification of their bidding behaviour and of operational dispatching decisions. This asymmetric treatment does not appear to be justified. Confidentiality of restricted information has to be considered.
Amendment 19 Proposal for a regulation – amending act Article 1 – point 5 Regulation (EC) No 1228/2003 Article 6 – paragraph 6 – introductory part
Text proposed by the Commission Amendment "6. Any revenues resulting from the allocation of interconnection shall be used for the following purposes in the order of priority: 6. Any revenues resulting from the allocation of interconnection shall be used for the following purposes without any order of priority:
Justification
Currently Transmission System Operators use the income from congestion management predominately to reduce national tariffs. Any change of this procedure will result in grid tariffs jumping up.
Additionally, obligating Transmission System Operators to finance new interconnection capacities by auction income will hinder them to receive an adequate return on investment. Otherwise, Transmission System Operators have no incentive to build new interconnection capacities. That would be contradictory to Directive 2005/89 (Security of Supply), Art. 6 (1(a)).
Amendment 20 Proposal for a regulation – amending act Article 1 – point 5 Regulation (EC) No 1228/2003 Article 6 – paragraph 6 – point (b a) (new)
Text proposed by the Commission Amendment   (ba) as an income to be taken into account by regulatory authorities when approving the methodology for calculating network tariffs, and/or in assessing whether tariffs should be modified.
Justification
Currently Transmission System Operators use the income from congestion management predominately to reduce national tariffs. Any change of this procedure will result in grid tariffs jumping up.
Additionally, obliging Transmission System Operators to finance new interconnection capacities by auction income will hinder them to receive an adequate return on investment. Otherwise, Transmission System Operators have no incentive to build new interconnection capacities. That would be contradictory to Directive 2005/89 (Security of Supply), Art. 6 (1(a)).
Amendment 21 Proposal for a regulation – amending act Article 1 – point 6 Regulation (EC) No 1228/2003 Article 7 – paragraph 1 – point (a a) (new)
Text proposed by the Commission Amendment   (aa) It should also contribute where possible to enhancing regional stability by providing new transportation options for either growth markets or markets with deficits to be served with secure energy supplies. Transmission constraints might be due to specific grid configuration that should be taken into account as important for development and/or better maintenance;
Justification
Balancing of the power and investment portfolio.
Amendment 22 Proposal for a regulation – amending act Article 1 – point 7 Regulation (EC) No 1228/2003 Article 7a – paragraph 1
Text proposed by the Commission Amendment In order to facilitate the emergence of well functioning and transparent cross-border retail markets on a regional and Community scale, Member States shall ensure that the roles and responsibilities of transmission system operators, distribution system operators, supply undertakings and customers and if necessary other market participants are defined with respect to contractual arrangements, commitment to customers, data exchange and settlement rules, data ownership and metering responsibility. In order to facilitate the emergence of well functioning and transparent cross-border retail markets on a regional and Community scale, Member States shall ensure that the roles and responsibilities of transmission system operators, distribution system operators, supply undertakings and customers and if necessary other market participants are defined with respect to contractual arrangements, including offtake agreements, lease or rent of the transmission system, uniform form of trading, strategic alliances among neighbouring countries, commitment to customers, including possible forecasts of price variations in the event of closure of plants or units thereof, data exchange and settlement rules, data ownership and metering responsibility.
Justification
The methods are market-based, flexible to be tailor-made to specific market situations and envisaged perspectives, contribute to the security of supply, transparency of activity and accountability of the stakeholders. Alternative utilization of resources of other facilities should be envisaged in order to ensure efficient and secure electricity supplies during peak demand periods.

PROCEDURE

Title	Conditions for access to the network for cross-border exchanges in electricity
References	COM(2007)0531 – C6-0320/2007 – 2007/0198(COD)
Committee responsible	ITRE
Opinion by        Date announced in plenary	ECON 11.10.2007
Drafts(wo)man        Date appointed	Mariela Velichkova Baeva 23.10.2007
Discussed in committee	29.1.2008		26.2.2008		1.4.2008
Date adopted	6.5.2008
Result of final vote	+: –: 0:	36 1 0
Members present for the final vote	Mariela Velichkova Baeva, Zsolt László Becsey, Pervenche Berès, Sharon Bowles, Udo Bullmann, Manuel António dos Santos, Jonathan Evans, Elisa Ferreira, Jean-Paul Gauzès, Robert Goebbels, Donata Gottardi, Karsten Friedrich Hoppenstedt, Sophia in ‘t Veld, Wolf Klinz, Christoph Konrad, Guntars Krasts, Kurt Joachim Lauk, Andrea Losco, Astrid Lulling, Florencio Luque Aguilar, Gay Mitchell, John Purvis, Alexander Radwan, Bernhard Rapkay, Antolín Sánchez Presedo, Margarita Starkevičiūtė, Ivo Strejček, Ieke van den Burg, Cornelis Visser
Substitute(s) present for the final vote	Valdis Dombrovskis, Harald Ettl, Ján Hudacký, Alain Lipietz, Diamanto Manolakou, Gianni Pittella, Bilyana Ilieva Raeva, Andreas Schwab

• [1]  Not yet published in OJ.

OPINION of the Committee on the Internal Market and Consumer Protection (9.4.2008)

for the Committee on Industry, Research and Energy

on the proposal for a regulation of the European Parliament and of the Council amending Regulation (EC) No 1228/2003 on conditions for access to the network for cross-border exchanges in electricity
(COM(2007)0531 – C6‑0320/2007 – 2007/0198(COD))

Draftsman: Leopold Józef Rutowicz

SHORT JUSTIFICATION

The Regulation of the European Parliament and of the Council serves to implement the decisions made by the Council and Parliament, which in a resolution of 10 July 2007 expressed strong support for a common energy policy. This policy requires:

· effective separation of supply and production activities from the network operation;

· further harmonisation of the powers and enhanced independence of the national energy regulators;

· establishment of an independent mechanism for cooperation among national regulators;

· creation of a mechanism for transmission system operators to improve the coordination of network operation and grid security, cross-border trade and grid operation;

· greater transparency in energy market operations.

The Regulation creates the practical conditions for achieving the above objectives by setting up the Agency for the Cooperation of Energy Regulators to monitor the execution of the tasks earmarked for the European Network of Transmission System Operators for Electricity. Implementation of the Regulation will create the conditions for improved competitiveness, better quality of supplies, energy conservation and improved energy security.

Electricity differs fundamentally from other traded goods, because it is a network-based product that is impossible or very costly to store. That is why the energy economy requires the introduction of independent mechanisms for cooperation and decision-making at the level of national regulators and regulation within the framework of the European market. That is why the introduction of formal structures for cooperation in this area under the amended Regulation (EC) No 1228/2003 on conditions for access to the network for cross-border exchanges in electricity is justified. These changes do not resolve all the problems of cross-border exchanges in electricity, but they introduce measures which in a limited way should increase efficiency and adapt network operations to market needs. The detailed technical and market codes included among the tasks of the European Network of Transmission System Operators for Electricity and the activities of the agency monitoring the execution of these tasks should ensure the added value for the European economy. The above measures should facilitate the emergence of well-functioning and transparent cross-border retail and wholesale markets.

The Regulation of the European Parliament and of the Council amending Regulation (EC) No 1228/2003 on conditions for access to the network for cross-border exchanges in electricity should help to regulate the internal electricity market, with due regard for the interests of consumers and operators, by means of:

· lower transmission costs and greater competitiveness, so that energy can be provided to consumers at lower prices while ensuring stability and security of energy supplies;

· setting up the Agency for the Cooperation of Energy Regulators and the European Network of Transmission System Operators for Electricity through coordination of national transmission systems. This should ensure better functioning of the European market and national systems by reducing energy transmission losses and promoting the development of small-scale energy based on renewable energy sources;

· development of electricity transmission networks, which will also lead to the necessary development of nuclear power stations, ensuring energy supplies at reasonably stable and low prices, and thereby undoubtedly enhancing the competitiveness and development of the European economy, while at the same time reducing CO₂ emissions. A sharp increase in oil or gas prices and heavy dependence on the political situation for supplies of these resources could threaten to destabilise the European economy and lead to a fall in real incomes.

Accordingly, the amendment of the Regulation will have a direct bearing on improved organisation of the electricity market and access to the network for cross-border exchanges in electricity, while the benefits to consumers will be determined by the detailed technical and market codes set out and advocated in the Regulation and their proper implementation.

AMENDMENTS

The Committee on the Internal Market and Consumer Protection calls on the Committee on Industry, Research and Energy, as the committee responsible, to incorporate the following amendments in its report:

Amendment  1 Proposal for a regulation – amending act Recital 4
Text proposed by the Commission	Amendment
(4) The Communication of the Commission to the European Parliament and the Council entitled "An Energy Policy for Europe" highlighted the importance of completing the internal market in electricity and to create a level playing field for all electricity companies in the Community. The Communication from the Commission to the European Parliament and to the Council on prospects for the internal gas and electricity market and the Communication from the Commission "Inquiry pursuant to Article 17 of Regulation (EC) No 1/2003 into the European gas and electricity sectors (Final Report)" showed that the present rules and measures do not provide the necessary framework to achieve the objective of a well functioning internal market.	(4) The Communication of the Commission to the European Parliament and the Council entitled "An Energy Policy for Europe" highlighted the importance of completing the internal market in electricity and to create a level playing field for all electricity companies in the Community. The Communication from the Commission to the European Parliament and to the Council on prospects for the internal gas and electricity market and the Communication from the Commission "Inquiry pursuant to Article 17 of Regulation (EC) No 1/2003 into the European gas and electricity sectors (Final Report)" showed that the present rules and measures do not provide the necessary framework to achieve the objective of a well functioning, effective and open internal market.
Justification
It is important to ensure an effective and open internal market, not just a well functioning market. It is important to have a market which is open for new entrants and to have effective competition for all participants.
Amendment  2 Proposal for a regulation – amending act Recital 6
Text proposed by the Commission	Amendment
(6) In particular, increased cooperation and coordination among transmission system operators is required to ensure progressive compatibility of the technical and commercial codes for providing and managing effective access to the transmission networks across borders, and to ensure coordinated and sufficiently forward looking planning and sound technical evolution of the transmission system in the Community, with due regard to the environment, and promote energy efficiency and research and innovation notably with respect to ensuring penetration of renewables and dissemination of low carbon technology. Transmission system operators should operate their networks according to these compatible technical and market codes.	(6) In particular, increased cooperation and coordination among transmission system operators is required to ensure compatibility of the technical and commercial codes for providing and managing effective and transparent access to the transmission networks across borders, and to ensure coordinated and sufficiently forward looking planning and sound technical evolution of the transmission system in the Community, with due regard to the environment, and promote energy efficiency and research and innovation notably with respect to ensuring penetration of renewables and dissemination of low carbon technology. Transmission system operators should operate their networks according to these compatible technical and market codes.
Justification
A transparent access to the transmission networks across borders is crucial for the development of an efficient and open market. Lack of transparent access can create barriers and have an impact of the level of competition.
Amendment  3 Proposal for a regulation – amending act Recital 7
Text proposed by the Commission	Amendment
(7) In order to ensure an optimal management of the electricity transmission network and to allow trading and supplying electricity to retail customers across borders in the Community a European network of the transmission system operators should be established. Its tasks should be carried out in compliance with Community competition rules which remain applicable to the decisions of the European network of the transmission system operators. Its tasks should be well-defined and their working method should be such as to ensure efficiency, representativity and transparency. Given that more effective progress may be achieved through an approach at regional level, transmission system operators should set up regional structures within the overall cooperation structure, whilst ensuring that results at regional level are compatible with codes and investment plans at Community level. Cooperation within such regional structures presupposes effective unbundling of network activities from production and supply activities in the absence of which regional cooperation between transmission system operators gives rise to a risk of anti-competitive conduct.	(7) In order to ensure an optimal management of the electricity transmission network and to allow trading and supplying electricity to retail customers across borders in the Community a European network of the transmission system operators should be established. Its tasks should be carried out in compliance with Community competition rules which remain applicable to the decisions of the European network of the transmission system operators. Its tasks should be well-defined and their working method should be such as to ensure efficiency, representativity and transparency. Given that more effective progress may be achieved through an approach at regional level, transmission system operators should set up regional structures within the overall cooperation structure, whilst ensuring that results at regional level are compatible with codes and investment plans at Community level. Member States should promote cooperation at regional level, and monitor the effectiveness of the network at that level. Cooperation at regional level should be compatible with progress towards a competitive and efficient European electricity market.
Amendment  4 Proposal for a regulation – amending act Recital 7 a (new)
Text proposed by the Commission	Amendment
	(7a) Cooperation at regional level between Member States and neighbouring countries with a European perspective should be promoted so as to ensure stability and security of supply, as well as the effectiveness of networks at that level.
Justification
The promotion of cooperation at regional level between Member States and neighbouring countries with a European perspective is very important for stability of countries and ensuring high level of regional economic cooperation.
Amendment  5 Proposal for a regulation – amending act Recital 8 a (new)
Text proposed by the Commission	Amendment
	(8a) Regarding the consultation process, consumers and consumer organisations should engage more decisively in the implementation of the tasks of the European Network of Transmission System Operators for Electricity, in particular in preparing technical and market codes and its annual work programme.
Justification
Consumers and consumer organisations should also be engaged in the consultation process, because they are important stakeholders, since they are household end users.
Amendment  6 Proposal for a regulation – amending act Recital 8 b (new)
Text proposed by the Commission	Amendment
	(8b) To ensure greater transparency of the situation regarding the entire electricity transmission network in Europe, the Commission should draw up, publish and update a road map for the electricity network in Europe. All feasible electricity transmission networks and possible regional connections should be included in this road map.
Amendment  7 Proposal for a regulation – amending act Recital 9
Text proposed by the Commission	Amendment
(9) Market monitoring undertaken over recent years by the national regulatory authorities and by the Commission has shown that current transparency requirements and rules on access to infrastructure are not sufficient.	(9) Market monitoring undertaken over recent years by the national regulatory authorities and by the Commission has shown that current transparency requirements and rules on access to infrastructure are not sufficient in order to secure a genuine, open and effective internal market.
Justification
Clarification of the text.
Amendment  8 Proposal for a regulation – amending act Recital 11
Text proposed by the Commission	Amendment
(11) To enhance trust in the market, its participants need to be sure that abusive behaviour can be sanctioned. Competent authorities should be enabled to effectively investigate allegations of market abuse. Therefore access to data to the competent authorities is necessary that provides information on operational decisions made by supply undertakings. In the electricity market many relevant decisions are made by the generators, who should keep this information available to the competent authorities for fixed period of time. Small generators with no real possibility to distort the market should be exempt from this obligation.	(11) To enhance trust in the market, its participants need to be sure that abusive behaviour can be sanctioned effectively. Competent authorities should be enabled to effectively investigate allegations of market abuse. Therefore access by the competent authorities to data that provides information on operational decisions made by supply undertakings is necessary. In the electricity market many relevant decisions are made by the generators, who should keep this information available to and easily accessible by the competent authorities for a fixed period of time. Furthermore, the competent authorities should regularly monitor system operators' compliance with the rules. Small generators with no real possibility to distort the market should be exempt from this obligation.
Justification
The Competent authorities should have easy access to important information from supply undertakings and shall monitor that the supply undertakings comply with the rules, in order to ensure a non-discriminatory, transparent and effective market.
Amendment  9 Proposal for a regulation – amending act Recital 12
Text proposed by the Commission	Amendment
(12) Competition for household-consumers requires that suppliers not be blocked when they want to enter new retail markets. Therefore rules and responsibilities governing the supply chain need to be known to all market parties, and they need to be harmonised with a view to enhancing Community market integration.	(12) Competition for household-consumers requires that suppliers not be blocked when they want to enter new retail markets. Therefore rules and responsibilities governing the supply chain need to be known to all market parties, and they need to be harmonised with a view to enhancing Community market integration. The competent authorities should regularly monitor market actors' compliance with the rules.
Justification
The addition is necessary in order to clarify a responsibility for the Complement authority, and to ensure the enforcement of the rules.
Amendment  10 Proposal for a regulation – amending act Article 1 – point 3 Regulation (EC) n° 1228/2003 Article 2c – paragraph 3 – point b
Text proposed by the Commission Amendment (b) grid connection and access rules; (b) grid connection and access rules, paying attention to the protection of the interests of TSO customers which are small and medium-sized enterprises;
Justification
Small and medium-sized enterprises often suffer from discrimination in the energy market
Amendment  11 Proposal for a regulation – amending act Article 1 – point 3 Regulation (EC) n° 1228/2003 Article 2c – paragraph 3 – point g
Text proposed by the Commission Amendment (g) rules for trading; (g) rules for trading, paying attention to the protection of the interests of TSO customers which are small and medium-sized enterprises;
Justification
Small and medium-sized enterprises often suffer from discrimination in the energy market
Amendment  12 Proposal for a regulation – amending act Article 1 – point 3 Regulation (EC) n° 1228/2003 Article 2c – paragraph 5
Text proposed by the Commission Amendment 5. The European Network of Transmission System Operators for Electricity shall publish a Community-wide 10-year network investment plan every two years. The investment plan shall include the modelling of the integrated network, scenario development, a generation adequacy report and an assessment of the resilience of the system. The investment plan shall, in particular, build on national investment plans and on the Guidelines for Trans-European energy networks in accordance with Decision No 1364/2006/EC of the European Parliament and of the Council. The investment plan shall identify investment gaps, notably with respect to cross border capacities. 5. The European Network of Transmission System Operators for Electricity shall publish, every two years, a Community-wide 10-year network investment plan, with the possibility of extension of this timeframe where necessary. The investment plan shall include the modelling of the integrated network, scenario development, a generation adequacy report and an assessment of the resilience of the system. The investment plan shall, in particular, build on national investment plans and on the Guidelines for Trans-European energy networks in accordance with Decision No 1364/2006/EC of the European Parliament and of the Council. The investment plan shall identify investment gaps, notably with respect to cross border capacities.
Justification
In many cases, large-scale investments and the development of the related networks require more than 10 years from conception to completion
Amendment  13 Proposal for a regulation – amending act Article 1 – point 3 Regulation (EC) n° 1228/2003 Article 2c – paragraph 5
Text proposed by the Commission Amendment 5. The European Network of Transmission System Operators for Electricity shall publish a Community-wide 10-year network investment plan every two years. The investment plan shall include the modelling of the integrated network, scenario development, a generation adequacy report and an assessment of the resilience of the system. The investment plan shall, in particular, build on national investment plans and on the Guidelines for Trans-European energy networks in accordance with Decision No 1364/2006/EC of the European Parliament and of the Council. The investment plan shall identify investment gaps, notably with respect to cross border capacities. 5. The European Network of Transmission System Operators for Electricity shall publish a Community-wide 10-year network investment plan every two years. The investment plan shall include the modelling of the integrated network, scenario development, a generation adequacy report and an assessment of the resilience of the system. The investment plan shall, in particular, build on national investment plans and on the Guidelines for Trans-European energy networks in accordance with Decision No 1364/2006/EC of the European Parliament and of the Council. The investment plan shall identify investment gaps, notably with respect to cross border capacities. The investment plan shall be linked to a strategic energy scenario for the next 20 to 25 years.
Amendment  14 Proposal for a regulation – amending act Article 1 – point 3 Regulation (EC) n° 1228/2003 Article 2d – paragraph 2
Text proposed by the Commission Amendment 2. The European Network of Transmission System Operators for Electricity shall submit the draft technical and market codes, the draft 10-year investment plan and the draft annual work programme, including the information regarding the consultation process, to the Agency. 2. The European Network of Transmission System Operators for Electricity shall submit its opinions and recommendations on the technical and market codes, the draft 10-year investment plan and the draft annual work programme, including the information regarding the consultation process, to the Agency.
Amendment  15 Proposal for a regulation – amending act Article 1 – point 3 Regulation (EC) n° 1228/2003 Article 2e – paragraph 1
Text proposed by the Commission Amendment 1. After consulting the Agency, the Commission may invite the European Network of Transmission System Operators for Electricity, within a reasonable period of time, to prepare codes in the areas listed in Article 2c(3) where it considers that such codes are necessary for the efficient functioning of the market. 1. After consulting the European Network of Transmission System Operators for Electricity, the Commission may invite the Agency, within a reasonable period of time, to prepare codes in the areas listed in Article 2c(3) where it considers that such codes are necessary for the efficient functioning of the market.
Amendment  16 Proposal for a regulation – amending act Article 1 – point 3 Regulation (EC) n° 1228/2003 Article 2f – paragraph 1
Text proposed by the Commission Amendment 1. In carrying out its tasks, the European Network of Transmission System Operators for Electricity shall consult extensively, at an early stage and in an open and transparent manner, in particular while preparing the technical and market codes and its annual work programme referred to in Article 2c(1) and (3), with all appropriate market participants; the consultation shall include supply and generation undertakings, customers, system users, distribution system operators, including relevant (industry) associations, technical bodies and stakeholder platforms. 1. In carrying out its tasks, the European Network of Transmission System Operators for Electricity shall consult extensively, at an early stage and in an open and transparent manner, in particular while preparing its annual work programme referred to in Article 2c(1) and (3), with all appropriate market participants; the consultation shall include supply and generation undertakings, customers, consumers, consumer organisations, system users, distribution system operators, including relevant (industry) associations, technical bodies and stakeholder platforms.
Amendment  17 Proposal for a regulation – amending act Article 1 – point (3) Regulation EC 1228/2003 Article 2h – paragraph 2
Text proposed by the Commission Amendment 2. Transmission system operators shall promote operational arrangements in order to ensure optimum management of the network, and promote the development of energy exchanges, the allocation of cross-border capacity through implicit auctions and the integration of balancing and reserve power mechanisms. 2. Transmission system operators shall promote operational arrangements in order to ensure optimum management of the network, and promote the development of energy exchanges, the allocation of cross-border capacity through implicit auctions and the integration of balancing and reserve power mechanisms. The Member States shall promote and monitor the network.
Justification
The Member States' promotion of the network and the obligation to monitor the effectiveness of the network is very important in ensuring a true internal cross border market and cooperation.
Amendment  18 Proposal for a regulation – amending act Article 1 – point 4 Regulation (EC) n° 1228/2003 Article 5 – paragraph 6
Text proposed by the Commission Amendment 6. Generation companies which own or operate generation assets, of which one has an installed capacity of at least 250 MW, shall keep at the disposal of the national regulatory authority, the national competition authority and the Commission, for five years all hourly data per plant that is necessary to verify all operational dispatching decisions and the bidding behaviour at power exchanges, interconnection auctions, reserve markets and OTC markets. The per plant and per hour information to be stored includes, but is not limited to, data on available generation capacity and committed reserves, including allocation of these committed reserves on a per plant level, at the time the bidding is carried out and when production takes place. 6. Generation companies which own or operate generation assets, of which one has an installed capacity of at least 250 MW, shall keep at the disposal of the national regulatory authority, the national competition authority, the Agency and the Commission, for five years all hourly data per plant that is necessary to verify all operational dispatching decisions and the bidding behaviour at power exchanges, interconnection auctions, reserve markets and OTC markets. The per plant and per hour information to be stored includes, but is not limited to, data on available generation capacity and committed reserves, including allocation of these committed reserves on a per plant level, at the time the bidding is carried out and when production takes place.
Amendment  19 Proposal for a regulation – amending act Article 1 – point (7) Regulation EC 1228/2003 Article 7a – paragraph 1
Text proposed by the Commission Amendment 1. In order to facilitate the emergence of well functioning and transparent cross border retail markets on a regional and Community scale, Member States shall ensure that the roles and responsibilities of transmission system operators, distribution system operators, supply undertakings and customers and if necessary other market participants are defined with respect to contractual arrangements, commitment to customers, data exchange and settlement rules, data ownership and metering responsibility. 1. In order to facilitate the emergence of well functioning, effective and transparent cross border retail markets on a regional and Community scale, Member States shall ensure that the roles and responsibilities of transmission system operators, distribution system operators, supply undertakings and customers and if necessary other market participants are thoroughly defined with respect to contractual arrangements, commitment to customers, data exchange and settlement rules, data ownership and metering responsibility.
Justification
To secure that cross border retail markets will work effectively as well.

PROCEDURE

Title	Conditions for access to the network for cross-border exchanges in electricity
References	COM(2007)0531 – C6-0320/2007 – 2007/0198(COD)
Committee responsible	ITRE
Opinion by        Date announced in plenary	IMCO 11.10.2007
Drafts(wo)man        Date appointed	Leopold Józef Rutowicz 31.1.2008
Discussed in committee	28.2.2008		2.4.2008
Date adopted	8.4.2008
Result of final vote	+: –: 0:	39 0 2
Members present for the final vote	Cristian Silviu Buşoi, Charlotte Cederschiöld, Gabriela Creţu, Mia De Vits, Janelly Fourtou, Vicente Miguel Garcés Ramón, Evelyne Gebhardt, Małgorzata Handzlik, Malcolm Harbour, Anna Hedh, Edit Herczog, Iliana Malinova Iotova, Pierre Jonckheer, Alexander Lambsdorff, Kurt Lechner, Lasse Lehtinen, Toine Manders, Arlene McCarthy, Nickolay Mladenov, Catherine Neris, Zita Pleštinská, Giovanni Rivera, Zuzana Roithová, Heide Rühle, Leopold Józef Rutowicz, Christel Schaldemose, Andreas Schwab, Eva-Britt Svensson, Marianne Thyssen, Jacques Toubon, Bernadette Vergnaud, Barbara Weiler, Marian Zlotea
Substitute(s) present for the final vote	Emmanouil Angelakas, Colm Burke, Giovanna Corda, Bert Doorn, Brigitte Fouré, Joel Hasse Ferreira, Olle Schmidt
Substitute(s) under Rule 178(2) present for the final vote	Bilyana Ilieva Raeva, Bogusław Sonik, Janusz Wojciechowski

PROCEDURE

Title	Conditions for access to the network for cross-border exchanges in electricity
References	COM(2007)0531 – C6-0320/2007 – 2007/0198(COD)
Date submitted to Parliament	19.9.2007
Committee responsible        Date announced in plenary	ITRE 11.10.2007
Committee(s) asked for opinion(s)        Date announced in plenary	ECON 11.10.2007		ENVI 11.10.2007		IMCO 11.10.2007
Not delivering opinions        Date of decision	ENVI 9.10.2007
Rapporteur(s)        Date appointed	Alejo Vidal-Quadras 9.10.2007
Discussed in committee	21.11.2007		19.12.2007		23.1.2008		29.1.2008
	31.1.2008		27.2.2008		26.3.2008		6.5.2008
Date adopted	28.5.2008
Result of final vote	+: –: 0:	46 0 4
Members present for the final vote	Šarūnas Birutis, Jan Březina, Philippe Busquin, Jerzy Buzek, Jorgo Chatzimarkakis, Giles Chichester, Dragoş Florin David, Pilar del Castillo Vera, Lena Ek, Adam Gierek, Norbert Glante, Umberto Guidoni, András Gyürk, Fiona Hall, David Hammerstein, Erna Hennicot-Schoepges, Ján Hudacký, Romana Jordan Cizelj, Werner Langen, Anne Laperrouze, Eugenijus Maldeikis, Eluned Morgan, Angelika Niebler, Reino Paasilinna, Atanas Paparizov, Francisca Pleguezuelos Aguilar, Anni Podimata, Miloslav Ransdorf, Vladimír Remek, Herbert Reul, Teresa Riera Madurell, Paul Rübig, Andres Tarand, Patrizia Toia, Catherine Trautmann, Claude Turmes, Adina-Ioana Vălean, Alejo Vidal-Quadras, Dominique Vlasto
Substitute(s) present for the final vote	Gabriele Albertini, Ivo Belet, Manuel António dos Santos, Robert Goebbels, Satu Hassi, Pierre Pribetich, Bernhard Rapkay, Silvia-Adriana Ţicău, Lambert van Nistelrooij
Substitute(s) under Rule 178(2) present for the final vote	Emmanouil Angelakas, Nicolae Vlad Popa