COMMISSION OF THE EUROPEAN COMMUNITIES 
Brussels, 26.03.1997 
COM(97) 125 final 
COMMUNICATION FROM THE COMMISSION 
TO THE COUNCIL AND THE EUROPEAN PARLIAMENT 
THE EXTERNAL DIMENSION OF TRANS-EUROPEAN ENERGY NETWORKS 

THE EXTERNAL DIMENSION OF TRANS-EUROPEAN ENERGY 
NETWORKS 
CONTENTS 
A. EXECUTIVE SUMMARY 
B. SITUATION OF ENERGY INTERCONNECTIONS WITH THIRD 
COUNTRIES 
1. Importance of energy interconnections with third countries. 
2. Situation of natural gas interconnections with third countries. 
3. Situation of electricity interconnections with third countries. 
C. COMMUNITY ACTIONS FOR IDENTIFYING AND PROMOTING 
ENERGY NETWORK PROJECTS IN THIRD COUNTRIES 
4. Identification of trans-European energy network projects of 
mutual interest. 
5. Identification of energy network projects of regional interest. 
6. Other Community actions of a political nature. 
7. Community actions of a financial nature. 
D. CONCLUSIONS 
ANNEXES 
I. Electricity network projects of mutual interest (list and map). 
II. Natural gas network projects of mutual interest (list and map). 
III. Overview of possible Community financial interventions for 
promoting energy policies and energy network projects 
in third countries. 
THE EXTERNAL DIMENSION OF TRANS-EUROPEAN ENERGY NETWORKS 
A. EXECUTIVE SUMMARY 
The aim of this Commission Communication is to analyse the main elements to 
be considered regarding natural gas and electricity interconnections with third 
countries and the development of these networks on the scale of the European 
Continent, of the Mediterranean Basin and, where appropriate, of Central Asia and 
the Middle East. 
Four main considerations emerge from the Commission analysis: 
(i) there is a good initial level of energy interconnection with third countries of 
Europe and of the Mediterranean Basin, but with some missing links, in 
particular with the Balkan and Baltic regions; 
(ii) identification of trans-European energy network projects of mutual interest 
is well advanced under the Community Guidelines for the TENs in the 
energy sector; 28 such projects, each one involving both Community and 
non-Community countries, have been identified so far; 
identification of energy network projects of regional interest in the third 
countries concerned has started; however, this is a longer-term cooperation 
process which the Community will continue to support, under the 
SYNERGY energy policy programme and the PHARE, TACIS and MEDA 
assistance programmes; 
(iii) the framework is in place for Community actions of a political nature for the 
implementation of trans-European and regional energy network projects in 
the third countries concerned (EC Treaty, TEN Guidelines, European 
Energy Charter, Association Agreements) and for the implementation of 
coherent energy policies in these countries (through the SYNERGY and the 
PHARE, TACIS and MEDA programmes); 
(iv) the Communitv financial intervention mechanisms are also in place for 
supporting i) the studies related to TEN mutual interest projects (aid from 
the TEN energy budget line), ii) the studies related to regional energy 
network projects in the third countries concerned (aid from the PHARE, 
TACIS and MEDA programmes) and iii) in specific cases, the investment 
related to the above projects in the third countries concerned (aid from 
PHARE and loans from the EIB). 
As a general conclusion, the Commission commits itself to making use of the 
available guidelines, political and financial instruments, where needed, in order to 
support the development of trans-European and regional energy network projects 
in the third countries concerned and their interconnection with the networks of the 
Community. The interconnection of energy networks on a wider scale will 
effectively contribute to improving the security of energy supplies, economic and 
social cohesion and the functioning of the internal market; it will also serve the 
competitivity, environmental protection, enlargement and external cooperation 
objectives of the Community. 
B. SITUATION OF ENERGY INTERCONNECTIONS WITH THIRD COUNTRIES 
1. Importance of energy interconnections with third countries 
The pursuit of the integration of infrastructures for the transmission of 
electricity and natural gas within the Community is necessarily accompanied 
by the development of connections with third countries. These connections 
respond both to developments in economic trade and to the need to 
strengthen security of energy supply (diversification of sources and supply 
routes). Further considerations are the improvement of economic and social 
cohesion, leading to better prospects for political stability and peace, and the 
functioning of the internal market in an enlarged Community. 
To a greater extent than in the transport and telecommunication sectors, the 
integration of the energy networks in the Community cannot be conceived of 
independently from the question of external interconnections. 
The integration of natural gas networks in the Community cannot be conceived 
of independently from the question of external interconnections, since the 
principal reserves are outside the Community and have to be connected with 
the networks inside the Community. 
External electricity interconnections allow greater economic efficiency and 
improved security of supply. 
Although the focus of this Communication will be on those projects having a 
trans-European dimension and which are of mutual interest to the Community 
and the third countries concerned, reference will be made also to projects 
having a more regional dimension, being of interest to two or more among the 
third countries concerned. 
In the matter of energy networks, the Commission constantly bears in mind 
the need to seek solutions which respect the environment, on the basis of the 
assessment of the environmental impact of the projects. 
2. Situation of natural gas interconnections with third countries 
The security of supply issue 
Development of natural gas networks is taking place against a background 
of increasing demand and market share for natural gas in virtually all EU 
Member States: for the EU as a whole, it is expected to grow from around 
20% of today's energy balance to around 26% in 2010. At the same time, 
as indigenous EU gas production declines, so dependence on imports from 
third countries is likely to rise significantly from almost 40% today to around 
60% by 2010, and possibly as high as 75% by 2020. 
The October 1995 Commission Communication on "European Community 
Gas Supply and Prospects"1 had, as objectives, the discussion of the future 
direction of the gas sector in the EC, and the examination of the issue of 
security of supply and what should be done at EC level to enhance it well 
into the next century. Among the Communication's conclusions was that 
both the interconnection of the EC gas systems and the establishing of 
connections with certain countries outside the EC would be crucial for the 
maintenance of security of supply for the EC. It was pointed out that some 
of the strategic interconnections were already identified as common interest 
projects under the Guidelines for the Trans-European Energy Networks2, 
and that the extension of the present list to include some of the "missing" 
pipeline links and storage projects identified in the Communication, including 
the needs of the most vulnerable Member States, would help to bolster EC 
security of supply. In its conclusions on the above Communication, the 
Energy Council meeting of 7 May 1996 confirmed that there is a need for 
further development and interconnection of gas networks inside the 
Community and outside with external suppliers and that this will require 
substantial investments. 
Current situation 
The current situation of the natural gas interconnections of the Community 
with third countries appears as follows: 
(i) gas pipelines connecting the Russian gas resources to several 
Community Member States already transit via other C.I.S. countries 
(Ukraine, Belarus, Moldavia) and via several Central and Eastern 
European countries (Poland, Slovakia, Czech Republic, Romania, 
Bulgaria); 
i COM (95) 478 final of 18 October 1995. 
OJ EC N' L161 of 29.06.1996 
(ii) Algerian gas is delivered to Italy via Tunisia (through the Trans-Med 
pipeline) and to Spain and Portugal via Morocco (through the new 
Maghreb-Europe pipeline). Algerian gas is also transferred by ship 
to several LNG terminals located in Belgium, France, Italy and 
Spain; 
(iii) three submarine gas pipelines connect the Norwegian gasfields of 
the North Sea with the North-West of the European continent, and 
a fourth with the United Kingdom. 
Future challenges 
For the Community and in the context of a widening external dependence, 
future development of gas networks should seek to maintain a high level of 
diversification of external gas supplies, from existing and possible new 
supplier countries, to improve flexibility of gas transfers within the 
Community and to increase underground storage. For the medium-term, 
investment plans of the gas companies would give priority to increasing gas 
imports from each one of the existing suppliers. For the longer term, 
however, the gas companies are also investigating the possibilities of new 
gas supplies (through pipelines or LNG facilities). 
In this context, the emergence of Central Asia and the Caspian Basin as a 
new oil and gas producing region with significant export potential to the 
European market should be taken fully into consideration. Providing that 
technical/economic feasibility and environmental issues are respected, new 
East-West transmission networks might be developed between the Caspian 
Sea area and Europe. 
The widening of the gas supply possibilities would be justified by EC's need 
to diversify its supplies and to create a climate of competition between 
present and potential future suppliers, among them the C.I.S. countries 
(Russia, Turkmenistan, Kazakhstan and Uzbekistan), those surrounding the 
European Community (Algeria, Norway and in the future possibly Iran) as 
well as other more distant (LNG) suppliers from the Middle East (Qatar), 
Western Africa (Nigeria) and Latin America. 
For Central and Eastern European countries which generally depend on one 
external gas supplier (Russia), the challenges of the future development of 
gas networks are connected above all with the need to improve security of 
supply together with the search for diversification of supply. Typical projects 
in these countries would be interconnection with Western European 
countries, creation of underground storage capacity and participation in the 
new supply gas pipeline projects. As several of these countries are 
candidates for accession to the European Union, the security of their gas 
supply will become a Community issue when they join the E.U. 
For those Mediterranean Basin third countries which have little or no gas 
production potential, the challenge will be to take part in regional gas 
transmission projects, in order to gain access to gas produced in 
neighbouring countries of the same region or in neighbouring regions. 
3. Situation of electricity interconnections with third countries. 
• Current situation 
As regards electricity networks, the CENTREL system (Poland, Czech 
Republic, Slovakia, Hungary) was connected synchronously to the UCPTE 
system at the end of 1995. The resulting interconnected network, known as 
TESIS (Irans European Synchronously interconnected System) now covers 
most of mainland Europe, from Portugal to Poland and from the continental 
part of Denmark to Italy. Since October 1996, a portion of the Ukrainian 
network has been operating within TESIS, on a trial basis. Although Greece 
is a member of the UCPTE organisation, its connection with the UCPTE 
network has been interrupted since the beginning of the war in former 
Yugoslavia. 
Switzerland is fully integrated into the UCPTE network, of which it is an 
active partner, with most exchanges between Germany, France and Italy 
taking place through her grid. 
Slovenia has been connected to the UCPTE network since 1975, when it 
was still part of former Yugoslavia, and now as a member. 
Norway is part of the NORDEL interconnected network, with the insular part 
of Denmark, Sweden and Finland. The NORDEL network is connected to 
the UCPTE network through six HV DC submarine cables (two between 
Norway and continental Denmark, two between Sweden and continental 
Denmark, one between Sweden and Germany and one between Denmark 
and Germany). 
The NORDEL network is also connected to the Russian electricity network, 
through an HV AC/DC/AC conversion station located in the St Petersburg 
area, near the Finno-Russian border. 
• Future challenges 
The Balkan countries are not connected to the UCPTE network. Their 
connection is the subject of studies which would recommend the 
preparatory measures and steps needed, for each country concerned. There 
is however an interconnected system on a regional scale, which functions 
between Albania, Bulgaria, Greece and a part of the network of former 
Yugoslavia. 
The Baltic States are not interconnected to the NORDEL or to the 
CENTREL/UCPTE systems. Their interconnection is the subject of ongoing 
studies in the context of the "Baltic ring electricity project". 
Following the interconnection of the CENTREL system to the UCPTE 
network, the interconnections which previously existed with the countries of 
the CIS have been temporarily interrupted. Their use raises broader 
problems (how to interconnect and how far?) which need to be answered. 
Several studies are under way or are foreseen, covering the basic 
assumptions (synchronous connection or through DC lines and conversion 
stations) and the technical installations which will be necessary to allow 
exchanges of electricity between the countries of Western, Central and 
Balkan Europe on the one hand, and Eastern European countries on the 
other. 
The Mediterranean countries are not connected to the UCPTE network but 
projects are in hand (Spain-Morocco) or anticipated (Greece-Turkey) which 
will result in establishing the first electricity links between the Community 
and the countries of the Western and Eastern parts of the Mediterranean 
Basin. 
C. COMMUNITY ACTIONS FOR IDENTIFYING AND PROMOTING ENERGY 
NETWORK PROJECTS IN THIRD COUNTRIES 
4. Identification of trans-European energy network projects of mutual 
interest 
• The TEN guidelines 
The guidelines on trans-European networks (TEN) for the energy sector3, 
adopted in June 1996, establish priorities and lines of action for the 
Community and identify projects of common interest. 
These priorities explicitly recognise the importance of the external 
dimension, and include, for electricity networks and for natural gas 
networks, respectively: 
"the development of interconnections with the third countries in Europe and 
the Mediterranean region which contribute to improving the reliability and 
security of the Community's electricity networks or to supplying the 
Community with electricity" and 
OJECNoL 161 of 29.06.96. 
8 
"increasing the transmission (gas delivery pipelines), reception (LNG) and 
storage capacities needed to satisfy demand, and diversification of supply 
sources and routes for natural gas". 
In accordance with these priorities, the list of projects of common interest 
identified by the guidelines already comprises a series of projects located 
partly on the territory of third countries. The current list of the guidelines 
contains, however, only the most mature projects. But other projects are 
already in preparation and the most advanced among these latter are now 
the subject of a new Commission proposal4, with a view to supplementing 
the current list. The extended list of current and new common interest 
projects represents an important stage in the exercise of identification of 
trans-European energy network projects. 
The TEN projects of mutual interest 
This extended list contains, among other projects, twenty-eight projects 
which are at the same time of interest for the Community and for one or 
more third countries. TEN projects such as these, involving both Community 
and non-Community countries, will be referred to hereafter as projects of 
mutual interest. 
A list of these mutual interest projects is annexed; it contains: 
(i) 11 electrical network projects of mutual interest, of which: 
• 2 interconnection projects for the Mediterranean area; 
• 4 interconnection projects for Mainland Europe; 
• 5 interconnection projects for Northern Europe, and 
(ii) 17 natural gas network projects of mutual interest, of which: 
• 2 pipeline projects on the Mediterranean axis; 
• 8 pipeline projects on the East European axis; 
• 2 pipeline projects on the North European axis; 
• 5 LNG reception terminals. 
Twelve of these twenty-eight mutual interest projects involve one or more 
third country candidates for accession to the European Union. Six of these 
twenty-eight mutual interest projects involve a Member State of the 
European Economic Area. 
4 COM (96) 390 final, of 24.07.96 and Council common position of 28.01.97. 
9 
5. Identification of energy network projects of regional interest 
Further to the identification of TEN projects of mutual interest, there is also a 
need to identify energy network projects of interest specific to the third 
countries concerned, referred to hereafter as projects of regional interest. 
Such identification requires a particular exercise of cooperation and of 
coordination among the third countries concerned and with the Community, for 
which the SYNERGY energy policy programme and the energy "sub-
programmes" of the PHARE, TACIS and MEDA assistance programmes are 
and will be efficient instruments. 
For the Central and Eastern European countries (including the Baltic States) 
and the C.I.S.. the PHARE and TACIS programmes are contributing to the 
identification of energy network projects of regional interest, through studies 
such as the "Gas Interconnection Study" or the "Study of the Interface between 
the Extended West-European Power System and Its Eastern Neighbours". 
The Commission has organised, among others, two major events under the 
SYNERGY programme: a conference in Budapest ("East-West Gas and 
Electricity Interconnections", October 1994) and a workshop in Bratislava (on 
"Trans-border co-operation in the Natural Gas Sector in Europe", April 1996) 
which have dealt with the subject of energy interconnections in the area. 
It should be noted in particular that, following the Bratislava conference, an 
EU-CEEC Gas Experts Contact Group was set up which among other issues 
will deal with the Trans-European Networks for gas, including tasks such as 
the identification of interconnection requirements and priorities. This group had 
its first meeting in October 1996 in Brussels. 
Moreover, the electricity undertakings of the countries around the Baltic Sea 
have initiated cooperation among themselves, in the framework of the "Baltic 
ring electricity project" studies. 
The Commission has started a coordinated exercise in the case of the Balkan 
area by creating, within the Black Sea Regional Energy Centre (located in 
Sofia), a task force on "Balkan Interconnections", supported in the framework 
of the SYNERGY programme. The idea of such a task force was launched at 
the Thessaloniki conference on Balkan energy interconnections (October 
1995). The task force held its inaugural meeting in September 1996 in 
Brussels and agreed to work on the basis of a one-year programme under 
which it will collect data and evaluate projects by the end of 1997, with a view 
to establishing priorities. 
The Commission is supporting a coordinated approach, under the TACIS 
Inter-State Oil and Gas Pipeline Programme (INOGATE), to the development 
of regional and trans-European pipeline infrastructure in the CIS. 
10 
For the Mediterranean Basin countries, several conferences have laid down 
the basis for further cooperation on energy matters, including network projects. 
At the Trieste conference (June 1996) a special Energy Forum was instituted 
to structure energy cooperation, including on the subject of energy networks. 
Moreover, in 1995 the electricity companies from the countries of the 
Mediterranean Basin (from Community Member States and from third 
countries) formed the SYSTMED study group in order to collect data and 
evaluate projects with a view to interconnecting all the countries round the 
Mediterranean. 
For those third countries which are candidates for accession to the European 
Union, most of the projects of regional interest that will be identified under this 
exercise would qualify for becoming TEN common interest projects, once 
accession is effective. 
6. Other Community actions of a political nature 
Beyond its essential contribution to the identification of projects of mutual and 
regional interest, the Community will continue to encourage the interconnection 
of energy networks on the scale of the European continent by other actions of 
a political nature, aiming at protecting investment and establishing the right of 
transit, securing political support for individual mutual interest projects and 
implementing coherent energy policies. 
• Energy Charter Treaty 
Effective implementation of the Energy Charter Treaty (ECT) will contribute 
to securing energy investment in the signatory third countries and 
establishing the right of transit on networks across these countries. 
Following the signing of the Energy Charter Treaty and the Energy Charter 
Protocol on energy efficiency and related environmental aspects on 17 
December 1994, the process of ratification by the European Community and 
the Member States is ongoing. Ratification by at least 30 countries is 
necessary for the Treaty to enter into force; meanwhile, the Treaty will be 
applied by most of the contracting parties on a provisional basis. 
Negotiations have started for defining the "rules of the game" for the pre-
investment phase of projects. 
Preliminary steps are also being taken by the Secretariat of the Charter, 
with Commission support, in order to have more third countries from the 
Mediterannean Basin signing the Charter as associated Members. 
11 
• Securing political support for trans-European mutual interest projects 
The Treaty establishing the European Community (Article 129 (c) para 3) 
enables the Community to co-operate with third countries for the promotion 
of projects of common interest and to ensure the interoperability of 
networks. In this context, the guidelines for the trans-European energy 
networks (Art 6, para 7) provide that, "where parts of projects of common 
interest are situated within the territory of third countries, the Commission 
may, by agreement with the Member States concerned, put forward 
proposals (...) for the projects also to be recognised as of reciprocal interest 
by the third countries concerned, in order to facilitate their implementation". 
If a problem arose for one or other of the projects of mutual interest, the 
Commission could start this procedure without delay. 
The question of interconnections, and more generally of energy 
infrastructures, appears among the topics of common interest identified in 
the Association. Partnership and Cooperation or Trade and Cooperation 
Agreements concluded with the majority of the third countries mentioned in 
this communication. These agreements can therefore serve, if necessary, 
as a legal basis for the development of specific initiatives. 
• Implementation of coherent energy policies 
The restructuring of the energy sectors and the progressive implementation 
of coherent energy policies by the third countries concerned, most of them 
experiencing low levels of energy efficiency in their economies and high 
levels of external dependency for their energy supplies, is also a factor 
contributing to the sound development of energy network projects. Indeed, 
energy policy measures (including their environmental and fiscal 
dimensions) promoting the rational use of all energy products should be 
adopted. Moreover, tariffs should progressively at least cover the cost of 
supplying energy products (source/border price plus transmission and 
distribution cost). In such a context, energy network companies operating 
in third countries concerned will be able to generate cash flow for paying 
running costs, maintenance work and a share of their investment 
programmes. However, progress towards more coherent energy policies will 
also depend on the pace at which the third countries concerned achieve the 
global restructuring of their economies. 
The "Oil and Gas Pipeline Initiative", funded under the TACIS Inter-State 
Pipeline Programme (INOGATE), is worth mentioning in the same context, 
of the implementation of coherent energy policies in a group of countries 
where development of pipeline infrastructure remains a key issue. 
12 
7. Community actions of a financial nature 
The European Community has already put in place a set of financial 
intervention mechanisms, through its programmes and financial institutions, 
which can be mobilised in favour of energy network projects in the third 
countries concerned. The aim is to create the required energy policy context 
and to support these projects financially at the stage of feasibility studies and, 
where appropriate, at the stage of capital investment, supplementing the 
operators' own funds. 
• Supporting the implementation of coherent energy policies 
The SYNERGY energy policy programme allows the Community to 
cooperate with third countries in the development of coherent energy 
policies, including those which favour the development of energy 
interconnections and networks. Among other actions, most of the 
conferences and workshops on East-West, Balkan and Mediteranean 
energy interconnections referred to in section 5 above, as well as the 
Balkan Task Force, have been financially supported under the SYNERGY 
programme. 
The PHARE and TACIS programmes are also supporting actions favouring 
the restructuring of the energy sectors \n the third countries concerned and 
the MEDA programme might do so in the future, 
Comparable activities could be proposed in the framework of the "Lomé 
Convention", Article 107 which provides for the encouragement of 
cooperation between ACP countries in the energy sector, in particular for 
the extension of electricity networks between ACP countries, as wei! as for 
cooperation between these countries and adjacent countries benefiting from 
Community financial support (e.g. Algeria and Morocco). 
• Financing studies for energy network projects 
The specific financial resources assigned to the trans-European energy 
networks (the TEN-Energy budget line) can be mobilised for the co-
financing of the feasibility and other studies relating to the projects of 
common interest identified by the guidelines for the trans-European energy 
networks. In the case of trans-European mutual interest projects, this 
possibility is also open for the study of the parts of these projects which are 
located on the territory of third countries; such a possibility has already been 
used by the Commission in its 1995 and 1996 decisions for financial support 
to studies for TEN projects. 
13 
In the case of energy network projects of regional interest, (co)financing of 
feasibility and other studies should call on resources from the available 
assistance programmes (PHARE. TACIS. MEDA). In fact a number of 
studies have already been financed by PHARE (e.g. the "Gas 
Interconnection Study" (1995) and the "Baltic Gas Study" (1996)) and 
TACIS. Such financing is expected to continue where required. 
Financing investment for energy network projects 
In the Community, economically viable energy network projects do not 
encounter insurmountable problems of financing. They are generally 
profitable projects - energy companies are able to recover costs through 
tariffs - which can gather private financing in addition to the operators' own 
resources. In these circumstances, investment subsidies are limited to 
assistance for structural purposes (mainly by the European Regional 
Development Fund). When solicited, Community lending instruments (mainly 
the EIB) may also intervene to supplement the financing of some energy 
network projects. These are the "rules of the game" in the Community. 
In line with the pre-accession strategy, similar conditions should prevail, 
progressively, and comparable financial instruments should gradually be 
made available for the financing of investments relating to energy network 
projects in the candidate third countries of Central and Eastern Europe and 
of the Mediterranean Basin. In fact, as agreed at the Copenhagen Summit 
(in June 1993) and confirmed since then, a proportion up to 25% of the total 
PHARE funding may be allocated in the form of aid to the financing of TEN 
projects, to the extent that these projects are given a high priority by the 
Community and the third country(ies) concerned. Trans-European mutual 
interest projects and the regional interest projects which would emerge from 
the concertation structures, as described in section 5 above, should be 
considered as good candidates for receiving such financial assistance for 
the investment, if needed. 
The lending instruments (mainly the EIB) are also in place. They should be 
able to take into consideration, according to their intervention criteria and 
where appropriate acting in concert with other international financial bodies 
(for example the EBRD and the World Bank), investment projects for energy 
networks in the third countries concerned. 
14 
Loan guarantees from the European Investment Fund (EIF) could also be 
made available for such projects, provided they contribute to the pursuit of 
Community objectives, and only in the case of cross-border projects with 
adjacent countries. 
An overview table of the above possibilities for Community financial 
intervention is annexed. 
D. Conclusions 
The above examination of the external dimension of the energy networks 
allows the following considerations to be stated: 
a) The current situation of energy interconnections between the Community 
and the third countries of Central and Eastern Europe and of the 
Mediterranean Basin shows a good level of interconnection, with the 
exception of electricity interconnections with the Mediterranean Basin 
and electricity and natural gas interconnections with the Balkan and the 
Baltic regions. Increased imports of natural gas and exchanges of 
electricity are anticipated in Europe and a series of energy network 
projects have been proposed. 
b) The identification of trans-European projects of mutual interest is well 
advanced : 28 such projects have been identified (see list in annex). 
Among these, several natural gas projects are under construction, some 
being very near to completion, and one major natural gas project (the 
Algeria - Morocco - Spain pipeline) having just been completed. 
Electricity networks projects are in general less advanced, most of them 
being at the studies or authorisations stages. For all these projects, 
information on progress is given in the annex. 
Steps have been initiated by the Commission in order to put in place the 
collaborative structures which will lead to the identification of regional 
interest projects for the main regions/areas concerned in Central and 
Eastern Europe and in the Mediterranean Basin. 
15 
c) The financing of feasibility and other studies relating to trans-European 
projects of mutual interest can be taken into consideration by the TEN-
Energy programme to the extent the projects proposed to be studied 
have clear implications for the electricity and gas supply of the 
Community. 
Studies relating to energy network projects of regional interest can call 
on the PHARE-TACIS-MEDA assistance programmes. 
d) As regards financing the investment of projects in the third countries 
concerned, the mobilisation of the operators' own resources and of other 
sources of private financing would be systematically sought. The 
Community will be able to intervene, where necessary, by specific 
assistance (as in the case of the PHARE programme), by loans (EIB) or 
loan guarantees (EIF) insofar as projects meet the criteria specific to 
these financial instruments or institutions and are also given high priority 
by the third countries concerned. Other financial institutions such as the 
EBRD and the World Bank may also contribute to such investment. 
From its analysis of the external dimension of the energy networks, the 
Commission draws the five following conclusions: 
e) The Community should continue supporting the implementation of 
coherent energy policies in the third countries concerned (through the 
SYNERGY energy policy programme and the PHARE, TACIS and MEDA 
assistance programmes) which is an essential condition for the rational 
development of energy networks. 
f) Where required, the Commission will be ready to take all accompanying 
political initiatives within the appropriate framework (Energy Charter 
Treaty, EC Treaty, TEN Guidelines, Association and other Agreements) 
to establish a more favourable context for the realisation of energy 
network projects of mutual (trans-European) and regional interest in the 
third countries concerned. 
g) The Commission will continue to make use of the available Community 
programmes in order to support the development of energy network 
projects in the third countries concerned. In particular: 
16 
Co-financing of studies related to energy network projects may, where 
appropriate, be provided from the TEN budget line, in the case of trans-
European mutual interest projects, and from the PHARE, TACIS and 
MEDA programmes in the case of regional interest projects. 
Co-financino of investment related to energy network projects may, 
where appropriate, be provided in the form of aid for projects to be 
implemented in the third countries which are candidate for accession to 
the European Union (e.g. under the PHARE programme). 
h) Where appropriate and according to the rules specific to each 
instrument, the Commission would recommend the use of other 
Community financial instruments (EIB loans and EIF guarantees) in 
favour of energy network projects of mutual (trans-European) and 
regional interest to be implemented in the third countries concerned. 
i) The Commission invites the Authorities of the Member States and of the 
third countries concerned to collaborate closely and to mobilise in order 
to develop and interconnect energy networks on a wider scale, with the 
aim of improving security of energy supply, economic and social 
cohesion and the functioning of the internal market and contributing to 
the competitivity, environmental protection, enlargement and external 
cooperation objectives of the Community. 
17 
ANNEX I 
THE EXTERNAL DIMENSION OF TRANS-EUROPEAN ENERGY NETWORKS 
I. LIST OF ELECTRICITY NETWORK PROJECTS OF MUTUAL INTEREST 
The development of electricity connections of the Community with third countries 
concerns three areas: the Mediterranean area, mainland Europe and Northern 
Europe. 
Mediterranean area 
d9 Greece-Turkey (*): connections between the two countries through 
North-eastern Greece. 
First section (in Greece): under construction. 
d13 Spain-Morocco (*): connection by submarine cable between Southern 
Spain and the Moroccan network. 
Under construction. 
Mainland Europe 
d2 Germany-Poland (**): strengthening of connections between the two 
countries. 
Feasibility studies. 
d5 Italy-Switzerland (*): strengthening connections between Northern Italy 
and Switzerland. 
First line: under construction. 
Second line: authorisation procedures. 
d8 Greece-Balkan countries (**): 
strengthening of connections between Greece and, 
respectively, Albania, Bulgaria and ex-Yugoslavia, 
including the restoration of the connection with the 
North of ex-Yugoslavia and the UCPTE network. 
Feasibility studies. 
d16 EU-Belarus-Russia-Ukraine (**): 
development of connections and interface between 
the (extended) UCPTE network and the networks of 
third countries in Eastern Europe, including the 
relocation of the HV DC conversion stations 
operating previously between Austria and Hungary, 
Austria and the Czech Republic and Germany and 
the Czech Republic. 
Interface study and feasibility studies. 
Northern Europe 
d3 Germany-Norway (*): connection by submarine cable between Northern 
Germany (UCPTE) and Southern Norway 
(NORDEL). 
Authorisation procedures. 
d10 United Kingdom-Norway (*): 
connection by submarine cable between North­
eastern/Eastern England and Southern Norway 
(NORDEL). 
Feasibility studies. 
d11 Netherlands-Norway (*): 
connection by submarine cable between 
North-eastern Netherlands (UCPTE) and Southern 
Norway (NORDEL). 
Feasibility studies and seabed survey. 
d14 Baltic Ring: Germany-Poland-Russia-Estonia-Latvia-Lithuania-Sweden-
Finland-Denmark-Belarus (*). 
strengthening and developing connections between 
the networks of these countries by overhead lines 
and/or submarine cables. 
Feasibility studies. 
(*) Project of common interest identified by the Guidelines on TEN-Energy. 
(**) Project proposed by the Commission as being of common interest (see 
COM (96) 390). 
13 
d15 Sweden-Norway (**): strengthening of the connections between the two 
countries. 
Feasibility studies and authorisation procedures. 
(**) Project proposed by the Commission as being of common interest (see 
COM (96) 390). 
2o 
THE EXTERNAL DIMENSION OF TRANS-EUROPEAN ENERGY NETWORKS 
II. MAP OF ELECTRICITY NETWORK PROJECTS OF MUTUAL INTEREST 
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ANNEX II 
THE EXTERNAL DIMENSION OF TRANS-EUROPEAN ENERGY NEPWORKS 
I. LIST OF NATURAL GAS NETWORK PROJECTS OF MUTUAL INTEREST 
The development of natural gas pipeline connections of the Community with third 
countries is made along three axes (Mediterranean, East-European, North-
European) which correspond to the three principal external production areas 
(Algeria, Russia, Norway) on which its supplies depend. The development of 
liquified natural gas (LNG) reception capacities is another way of linking the 
Community with external production areas. 
Mediterranean axis 
h4 Algeria-Spain-Portugal-France (*): 
construction of new gas pipelines to allow Spain and 
Portugal initially, and subsequently France and other 
countries, to be supplied from Algeria via Morocco. 
Algeria - Morocco - Spain (up to Cordoba) pipeline: 
in operation since November 1996. 
Extensions to the North-East and the North-West: 
feasibility studies and authorisation procedures. 
h5 Algeria-Tunisia-Italy (*): 
strengthening of the transport capacity of the trans-
Mediterranean gas pipeline to Italy from Algerian 
resources. 
First pipeline: in operation for several years. 
Second pipeline: construction near completion. 
East-European Axis 
f9 Austria-Hungary (**): connection between the networks of the two 
countries. 
First pipeline : in operation since 1996. 
Second pipeline : feasibility studies. 
2Z. 
f10 Austria-Slovakia (**): connection of Austria to underground storage 
capacity in Slovakia. 
Construction near completion. 
f12 Greece-Albania (**): connection between the networks of the two 
countries. 
Feasibility studies. 
h6 Russia-Ukraine-UE (*): 
increasing transport capacity to the European Union 
from Russian resources via the main existing axis, 
through Ukraine, Slovakia and the Czech Republic. 
Pipeline system in operation for several years. 
Upgrading investment will be needed. 
h7 Russia-Belarus-Poland-EU (*): 
creation of a second transport axis from Russian 
resources to the European Union via Belarus and 
Poland. 
Eastern Germany - Western Poland section: in 
operation since 1996. 
Other sections: authorisation procedures and under 
construction. 
h11 Bulgaria-Greece (*): improvement of the gas transportation network in 
Bulgaria to ensure supplies from Russian resources 
to the new gas network in Greece. 
First phase: commissioned in 1996. 
h 13 Germany-Czech Republic-Austria-ltaly (**): 
construction of a system of connecting pipelines 
between the German, Czech, Austrian and Italian 
gas networks. 
First section in Western Austria: under construction. 
Second section (the main PENTA pipeline) in 
Central Austria: feasibility studies. 
23 
h14 Russia-Ukraine-Slovakia-Hungary-Slovenia-ltaly (**): 
construction of a new gas pipeline, from Russian 
resources to Italy. 
Feasibility studies. 
North-European axis 
hi Norway-France (**): construction of a 4th gas pipeline from Norwegian 
resources (North Sea) to the Continent. 
Under construction. 
h3 Norway-Denmark-Sweden-Finland-Russia-Baltic States (**): 
creation and development of connections between 
the networks of these countries with a view to 
setting up an integrated gas network. 
Feasibility studies. 
LNG reception terminals 
e4 Spain (*): 
e5(a) Portugal (**): 
e6 Greece (*): • LNG of Huelva (extending existing terminal). 
In operation since 1996. 
• LNG of Cartagena (extending existing terminal) 
Pre-feasibility studies. 
• LNG in Galicia (new terminal). 
Project postponed. 
LNG on the Atlantic coast (new terminal). 
Feasibility studies. 
LNG in Attica (new terminal). 
Under construction. 
ZH 
g3 France (*): LNG in Western France (extending existing 
terminal). 
Pre-feasibility studies. 
g4 Italy (*): Construction of a new LNG terminal to allow 
diversification of supplies, in particular for electricity 
generation. 
Authorisation procedures. 
(*) Project of common interest identified by the Guidelines on TEN-Energy 
(**) Project proposed by the Commission as being of common interest (see COM (96) 390). 
zs 
THE EXTERNAL DIMENSION OF TRANS-EUROPEAN ENERGY NETWORKS 
II. MAP OF NATURAL GAS NETWORK PROJECTS OF MUTUAL INTEREST 
Existing networks. 
Trans-European projects of mutual interest. 
Other trans-European projects. 
IQ 
ANNEX III 
THE EXTERNAL DIMENSION OF TRANS-EUROPEAN ENERGY NETWORKS 
OVERVIEW OF POSSIBLE COMMUNITY FINANCIAL INTERVENTIONS FOR 
PROMOTING ENERGY POLICIES AND ENERGY NETWORK PROJECTS IN 
THIRD COUNTRIES 
ACTIONS >/ 
^,/THlRD 
^/COUNTRIES 
Supporting the 
implementation 
of energy 
policies: 
• Community 
initiatives 
• Third country 
initiatives 
Co-financing of 
studies: 
• For TEN mutual 
interest projects 
• For regional 
interest network 
projects 
Financing of 
investments: 
• Aid 
• Loans 
• Guarantees for 
loans to cross-
border projects 
in adjacent 
countries. NORWAY 
and 
SWITZERL. 
-
TEN 
EIB 
EIF CEEC 
(including 
Baltic States) 
SYNERGY 
PHARE 
TEN 
PHARE 
PHARE 
EIB 
EIF CIS 
SYNERGY 
TACIS 
TEN 
TACIS 
EIF 
i 
i 
i 
| MED 
SYNERGY 
MEDA 
TEN 
MEDA 
EIB 
EIF 
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ISSN 0254-1475 
COM(97)12S final 
DOCUMENTS 
EN 12 11 
Catalogue number : CB-CO-97-120-EN-C 
ISBN 92-78-17492-0 
Office for Official Publications of the European Communities 
L-2985 Luxembourg