Amended proposal for a Regulation of the European Parliament and of the Council on conditions for access to the network for cross-border exchanges in electricity (presented by the Commission pursuant to Article 250 (2) of the EC-Treaty)
Date: 2002-06-07
Institutions: European Commission
Subjects: domestic market, electrical energy, energy distribution, energy grid, energy production, energy supply, energy transport, market access

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Official Journal of the European Communities

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Amended proposal for a Regulation of the European Parliament and of the Council on conditions
for access to the network for cross-border exchanges in electricity (1)

(2002/C 227 E/20)

(Text with EEA relevance)

COM(2002) 304 final — 2001/0078(COD)

(Submitted by the Commission pursuant to Article 250(2) of the EC Treaty on 7 June 2002)

(1) OJ C 240 E, 28.8.2001, p. 72.

INITIAL PROPOSAL

AMENDED PROPOSAL

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE
EUROPEAN UNION,

Unchanged

Having regard to the Treaty establishing the European
Community, and in particular Article 95 thereof,

Having regard to the proposal from the Commission,

Having regard to the opinion of the Economic and Social
Committee,

Having regard to the opinion of the Committee of the Regions,

Acting in accordance with the procedure laid down in Article
251 of the Treaty,

Whereas:

(1) Directive 96/92/EC of the European Parliament and of the
Council of 19 December 1996 concerning common rules
in electricity (1) constituted an
for the internal market
important step in the completion of the internal market
in electricity.

(2) At its meeting in Lisbon on 23 and 24 March 2000, the
European Council called for rapid work to be undertaken
to complete the internal market in both the electricity and
gas sectors and to speed up liberalisation in these sectors
with a view to achieving a fully operational
internal
market in these areas.

(3) The creation of a real internal electricity market should be
promoted through an intensification of trade in electricity,
which is currently underdeveloped compared to other
sectors of the economy.

(4) Fair, cost-reflective,

transparent and directly applicable
rules, completing the provisions of Directive 96/92/EC,
should be introduced with regard to cross-border tarifi-
cation and the allocation of available interconnection
capacities,
in order to ensure effective access to trans-
mission systems for the purpose of cross-border trans-
actions.

___________
(1) OJ L 27, 30.1.1997, p. 20. Directive as amended by Directive . . .

(4) Fair, cost-reflective,

transparent and directly applicable
rules, taking account of a comparison between efficient
network operators from structurally comparable areas and
completing the provisions of Directive 96/92/EC, should
be introduced with regard to cross-border tarification and
in
the allocation of available interconnection capacities,
order to ensure effective access to transmission systems
for the purpose of cross-border transactions.

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INITIAL PROPOSAL

AMENDED PROPOSAL

(5) In its Conclusions, the Energy Council of 30 May 2000
invited the Commission, Member States and national
regulatory authorities/administrations to ensure a rapid
system and
robust
introduction of
methodology
interconnection
allocate
to
capacity for the longer term.

tarification
available

a

Unchanged

(6) The European Parliament, in its Resolution of 6 July 2000
on the Commission's second report on the state of
liberalisation of energy markets, called for conditions for
using networks in Member States that do not hamper
cross-border
in electricity and called on the
Commission to submit specific proposals geared to over-
coming all the existing barriers to intra-Community trade.

trade

(7) This Regulation should lay down basic principles with
regard to tarification and capacity allocation, whilst
adoption of guidelines detailing
providing for
further relevant principles and methodologies,
in order
to allow rapid adaptation to changed circumstances.

the

(8) In an open, competitive market,

transmission system
operators should be compensated for costs incurred as a
result of hosting transit of electricity on their networks by
the operators of the transmission systems from which
transits originate or and for which they are destined.

(8) In an open, competitive market,

transmission system
operators should be compensated for costs incurred as a
result of hosting cross-border flows of electricity on their
networks by the operators of the transmission systems
and the
from which cross-border
systems where those flows end.

flows originate

(9) Payments and receipts

resulting from compensation
between transmission system operators should be taken
into account when setting national network tariffs.

Unchanged

(10) The actual amount payable for cross-border access to the
system can vary considerably, depending on the trans-
mission system operators involved and as a result of
differences in the structure of
the tarification systems
applied in Member States. A certain degree of harmon-
isation is therefore necessary in order to avoid distortions
of trade.

(11) It would not be appropriate to apply distance-related
tariffs, or, a specific tariff to be paid only by exporters
or importers

(11) It would not be appropriate to apply distance-related
tariffs, or, provided appropriate locational signals are in
place, a specific tariff to be paid only by exporters or
importers in addition to the general charge for access to
the national network.

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INITIAL PROPOSAL

AMENDED PROPOSAL

lines

access

to the

(12) Competition on the internal market can only truly
develop if
interconnecting the
different national systems is granted in a non-discrimi-
natory and transparent way. The available capacities of
these lines should be set at the maximum complying
with the safety standards of secure network operation.
Any discrimination in the allocation of available capacities
should be shown not to unreasonably distort or hinder
the development of trade.

(13) There

be

should

actors
transparency
concerning available transfer capacities and the security,
planning and operational
the
available transfer capacities.

for market

standards

affect

that

(14) Of

revenues

flowing

from congestion-management
should not constitute a source of extra

procedures,
profit for the transmission system operators.

(12) The precondition for effective competition in the internal
market is non-discriminatory and transparent charges for
network use including interconnecting lines in the trans-
mission system. The available capacities of these lines
the maximum complying with the
should be set at
safety standards of
secure network operation. Any
discrimination in the allocation of available capacities
should be shown not to unreasonably distort or hinder
the development of trade.

Unchanged

(14) There should be rules on the use of revenues flowing
the
from congestion-management procedures, unless
specific nature of the interconnector concerned justifies
a time-limited exemption from these rules

(15) It should be possible to deal with congestion problems in
various ways as long as the methods used provide correct
economic signals to transmission system operators and
market parties and are based on market mechanisms.

Unchanged

(16) To ensure the smooth functioning of the internal market,
provision should be made for procedures which allow the
adoption of decisions and guidelines with regard to tarifi-
cation and capacity allocation by the Commission whilst
ensuring the involvement of Member States' regulatory
authorities in this process.

(17) authorities

should be

required to provide

relevant
information to the Commission. Such information
should be treated confidentially by the Commission.
Where necessary, the Commission should have the possi-
bility to request relevant information directly from under-
takings concerned.

(17) The Member States and the competent national auth-
orities should be required to provide relevant information
to the Commission. Such information should be treated
confidentially by the Commission. Where necessary, the
the possibility to request
Commission should have
relevant
from undertakings
concerned.

information

directly

(18) National regulatory authorities should ensure compliance
with the rules contained in this Regulation and the
guidelines adopted on the basis of this Regulation.

Unchanged

(19) Member States

should lay down rules on penalties
applicable to infringements of the provisions of this Regu-
lation and ensure that
they are implemented. Those
penalties must be effective, proportionate and dissuasive.

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INITIAL PROPOSAL

AMENDED PROPOSAL

(20) In accordance with the principles of subsidiarity and
proportionality as set out in Article 5 of the Treaty, the
objectives of the proposed action, namely the provision of
a harmonised framework for cross-border exchanges of
electricity, cannot be achieved by the Member States
and can therefore, by reason of the scale and effect of
the action, be better achieved by the Community. This
Regulation confines itself to the minimum required in
order
to achieve those objectives and does not go
beyond what is necessary for that purpose.

for

the exercise of

(21) In accordance with Article 2 of Council Decision
1999/468/EC of 28 June 1999 laying down the
implementing powers
procedures
conferred on the Commission (1), measures
the
implementation of this Regulation should be adopted by
use of the regulatory procedure provided for in Article 5
the advisory
of Decision 1999/468/EC, or by use of
procedure provided for in Article 3 of
that Decision,
according to the nature of the measures to be adopted,

for

HAVE ADOPTED THIS REGULATION:

Article 1

Subject matter and scope

through the

This Regulation aims at stimulating cross-border exchanges in
electricity and thus competition within the internal electricity
compensation
market,
mechanism for
setting of
harmonised principles on cross-border transmission charges
and the allocation of available capacities of interconnections
between national transmission systems.

establishment of
transit of electricity and the

a

through the

This Regulation aims at stimulating cross-border exchanges in
electricity and thus competition within the internal electricity
compensation
market,
a
mechanism for cross-border
flows of electricity and the
setting of harmonised principles on cross-border transmission
charges and the allocation of available capacities of intercon-
nections between national transmission systems.

establishment of

Article 2

Definitions

Unchanged

For

1.
contained in Article 2 of Directive 96/92/EC shall apply.

the purpose of

this Regulation,

the definitions

2.

The following definitions shall also apply:

(a) means a physical flow of electricity hosted on the trans-
mission system of a Member State, which was neither
consumption in that
produced nor
Member
are
flows which
State,
commonly denominated as ‘loop-flows’ or ‘parallel-flows’;

is destined for

including

transit

(a) ‘cross-border flow’ means a physical flow of electricity on a
transmission network of a Member State that results from
the activity of either generators or consumers outside of
that Member State;

___________
(1) OJ L 184, 17.7.1999, p. 23.

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INITIAL PROPOSAL

AMENDED PROPOSAL

(b) ‘congestion’ means a situation in which an interconnection
linking national
transmission networks, cannot accom-
modate all transactions resulting from international trade
by market operators, due to a lack of capacity;

(b) ‘congestion’ means a situation in which an interconnection
linking national
transmission networks, cannot accom-
modate all transactions resulting from international trade
by market operators, due to a lack of capacity of the inter-
connectors
transmission systems
concerned;

the national

and/or

(c) ‘export’ of electricity means the dispatch of electricity in
one Member State with the understanding that the simul-
taneous corresponding take-up (‘import’) of electricity will
take place in another Member State or a third country.

Article 3

Unchanged

Inter transmission system operator compensation
mechanism

Transmission system operators shall

1.
receive compen-
sation for costs incurred as a result of hosting transit flows
of electricity on their network.

Transmission system operators shall

1.
receive compen-
sation for costs incurred as a result of hosting cross-border
flows of electricity on their network.

The compensation referred to in paragraph 1 shall be
2.
paid by the operators of national transmission systems from
which transit flows originate and/or the systems where those
flows end.

The compensation referred to in paragraph 1 shall be
2.
paid by the operators of national transmission systems from
which cross-border flows originate and the systems where
those flows end.

3.
Compensation payments shall be made on a regular basis
with regard to a given period of time in the past. Ex-post
adjustments of compensation paid shall be made where
necessary to reflect actual costs incurred.

3.
Compensation payments shall be made on a regular basis
with regard to a given period of time in the past. Ex-post
adjustments of compensation paid shall be made where
necessary to reflect actual costs incurred and recognised.

The first period of time with regard to which compensation
payments shall be made shall be determined in the guidelines
referred to in Article 7.

Unchanged

4.
Acting in accordance with the procedure referred to in
Article the Commission shall decide on the amounts of
compensation payments payable.

4.
Acting in accordance with the procedure referred to in
Article 12(4), the Commission shall decide on the amounts of
compensation payments payable.

The amounts of transit flows hosted and the amounts of
5.
transmission
flows originating and/or ending in national
the physical
systems shall be determined on the basis of
flows of electricity actually measured in a given period of time.

The costs incurred as a result of hosting transit flows
6.
the forward looking
shall be established on the basis of
(reflecting costs and
long-run average
costs
benefits that a network bears from hosting transit
flows
compared to the costs it would bear in the absence of such
flows).

incremental

The amounts of cross-border

flows hosted and the
5.
flows designated as originating
amounts of cross-border
shall be
and/or ending in national
determined on the basis of the physical flows of electricity
actually measured in a given period of time.

transmission systems

new infrastructure

The costs incurred as a result of hosting cross-border
6.
flows shall be established on the basis of the forward looking
long-run average incremental costs, taking into account losses,
investment
appropriate
in
the cost of existing infrastructure, as far as
proportion of
existing infrastructure was built
to transmit cross-border
flows. When establishing the costs incurred, standard-costing
methodologies shall be used. Benefits that a network incurs as
a result of hosting cross-border flows shall be taken into
account.

and

an

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INITIAL PROPOSAL

AMENDED PROPOSAL

Article 4

Unchanged

Charges for access to networks

1.
Charges applied by national network-operators for access
to national networks shall be reflect actual costs incurred, and
shall be transparent, approximated to those of an efficient
network operator
and applied in a non-discriminatory
manner. They shall not be distance-related.

Charges applied by network-operators

1.
to
national networks shall be transparent and reflect actual costs
incurred in so far as they correspond to those of an efficient
and structurally comparable network operator and applied in a
non-discriminatory manner. They shall not be distance-related.

for access

Generators and consumers (load) may be charged for
2.
access to national networks. The proportion of
the total
amount of the network charges borne by generators shall be
lower than the proportion borne by consumers. Where appro-
the level of the tariffs applied to generators and/or
priate,
consumers shall provide locational signals, and take into
account the amount of network losses and congestion caused.

Unchanged

Payments and receipts resulting from the inter-trans-
3.
mission system operator compensation mechanism shall be
taken into account when setting the charges for network
access. Actual payments made and received as well as
payments expected for future periods of time, estimated on
the basis of past periods, shall be taken into account.

Subject to paragraph 2, charges for access to national
4.
shall be
networks applied to generators and consumers
the country of destination and
applied independently of
respectively origin of
specified in the
underlying commercial arrangement. Exporters and importers
shall not be charged any specific charge in addition to the
general charge for access to national networks.

the electricity, as

to national networks

Providing that appropriate and efficient locational signals
4.
in accordance with paragraph 2, charges for
are in place,
access
and
consumers shall be applied independently of the country of
destination and respectively origin of
as
specified in the underlying commercial arrangement. This
shall be without prejudice to charges on exports and imports
resulting from congestion management referred to in Article 6.

applied to generators

electricity,

the

5.
There shall be no specific network charge on individual
transactions for transits of electricity covered by the inter-trans-
mission system operator compensation mechanism.

There shall be no specific network charge on individual

5.
transactions for transits of electricity.

Article 5

Unchanged

Provision of information on interconnection capacities

Coordination and information exchange mechanisms
in place by transmission system operators to
in the context of

1.
shall be put
ensure the security of
congestion management.

the networks

1.
Transmission system operators shall put in place coor-
dination and information exchange mechanisms to ensure the
security of
congestion
management.

the networks

context of

in the

2.
The safety, operational and planning standards used by
transmission system operators shall be made public. This publi-
cation shall include a general scheme for the calculation of the
total transfer capacity and the transmission reliability margin
based upon the electrical and physical features of the network.
Such schemes shall be subject to the approval of the national
national regulatory authorit

2.
The safety, operational and planning standards used by
transmission system operators shall be made public. This publi-
cation shall include a general scheme for the calculation of the
total transfer capacity and the transmission reliability margin
based upon the electrical and physical features of the network.
Such schemes shall be subject to the approval of the national
regulatory authorities, referred to in Article 22 of Directive
96/92/EC.

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INITIAL PROPOSAL

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3.
Transmission system operators shall publish estimates of
available transfer capacity for each day, indicating any available
transfer capacity already reserved. These publications shall be
made at specified time intervals before the day of transport and
shall
in any case, week-ahead and month-ahead
estimates, The data published shall include a quantitative indi-
cation of the expected reliability of the available capacity.

include,

3.
Transmission system operators shall publish estimates of
available transfer capacity for each day, indicating any available
transfer capacity already reserved. These publications shall be
made at specified time intervals before the day of transport and
shall
in any case, week-ahead and month-ahead
estimates, as well as a quantitative indication of the expected
reliability of the available capacity.

include,

Article 6

Unchanged

General principles congestion management

General principles of congestion management

Network congestion problems shall be addressed with
1.
non-discriminatory market-based
give
efficient economic signals to the market participants and trans-
mission system operators involved.

solutions which

Unchanged

2.
Transaction curtailment procedures shall only be used in
emergency situations where the transmission system operator
must act
in an expeditious manner and redispatching or
countertrading is not possible.

2.
Transaction curtailment procedures shall only be used in
emergency situations where the transmission system operator
must act
in an expeditious manner and redispatching or
countertrading is not possible. Any such procedure shall be
applied in a non-discriminatory manner.

market participants who have been allocated capacity shall be
compensated for any curtailment of this capacity.

Except in cases of ‘force-majeur’, market participants who have
any
shall be
been allocated capacity
curtailment.

compensated for

The maximum capacity of the interconnections shall be
3.
made available to market participants, complying with safety
standards of secure network operation.

Unchanged

Any allocated capacity that will not be used shall be

4.
reattributed to the market,

4. Market participants shall inform the transmission system
operators concerned a reasonable time ahead of the relevant
operational period whether
they intend to use allocated
capacity. Any allocated capacity that will not be used shall
in an open, transparent and
be reattributed to the market,
non-discriminatory manner.

5.
Transmission system operators shall, as far as technically
possible, net the capacity requirements of any power flows in
opposite direction over the congested interconnection line in
order to use this line to its maximum capacity. In any event,
transactions that relieve the congestion shall never be denied.

5.
Transmission system operators shall, as far as technically
possible, net the capacity requirements of any power flows in
opposite direction over the congested interconnection line in
order to use this line to its maximum capacity. Having full
regard to network security,
relieve the
congestion shall never be denied.

transactions

that

6.
Any rents revenues resulting from the allocation of inter-
connection capacities shall be used for one or more of the
following purposes:

6.
Any revenues resulting from the allocation of intercon-
nection capacities which exceed a reasonable return on
investment shall be used for one or more of the following
purposes:

(a) guaranteeing the actual availability of the allocated capacity;

Unchanged

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AMENDED PROPOSAL

(b) network investments maintaining or increasing intercon-

nection capacities;

(c) reduction of network charges.

These rents may be put into a fund that is managed by trans-
mission system operators. They shall not constitute a source of
extra profit for the transmission system operators.

Deleted

7.
The national regulatory authorities referred to in Article
22 of Directive 96/92/EC, of those Member States linked by
any interconnector may, on a case by case basis and in
common, decide that an interconnector shall be subject to a
time-limited exemption from paragraph 6. The exemption shall
be renewable.

An interconnector exempt from the provisions of paragraph 6
shall remain subject to the provisions of Article 22 Directive
96/92/EC and the Competition Rules of the EC Treaty.

In order to be eligible for an exemption referred to in
the following

8.
paragraph 7, an interconnector must
conditions:

fulfil

(a) it is owned by a natural or legal person which is separate at
least
form from the transmission
system operators whose systems that interconnector links;

in terms or its legal

(b) charges are levied on specific users of the interconnector;

(c) at no time since the implementation of Directive 96/92/EC,
any part of the capital or operating costs of the intercon-
nector has been recovered from any component of charges
made for the use of transmission or distribution systems
linked by the interconnector;

An exemption shall be excluded where Community or national
legislation prohibits parties, other than the two transmission
and/or
from
system operators
constructing a new interconnector between the two trans-
mission or distribution systems concerned.

distribution

concerned,

An exemption shall normally only apply to direct current inter-
connectors.

to the decision. This

9.
The decision and the conditions relating to the award of
an exemption shall be published and notified without delay to
the Commission, together with all the relevant information
information may be
with respect
submitted to the Commission in aggregate form, enabling the
Commission to reach a well founded decision. Within four
weeks of receipt of
the Commission may
this notification,
request
regulatory authority concerned
that
amend or withdraw the decision to grant an exemption.

the national

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INITIAL PROPOSAL

AMENDED PROPOSAL

request within a period of

If the national regulatory authorities concerned do not comply
with this
the
Commission shall expeditiously take a final decision in
accordance with procedure referred to in Article 12(2) of this
Regulation.

four weeks,

The Commission shall preserve
commercially sensitive information.

the

confidentiality

of

Article 7

Guidelines

Unchanged

1. Where appropriate,
the Commission shall, acting in
accordance with the procedure referred to in Article 12(2),
adopt and amend guidelines on the following issues with
regard to the inter-transmission system operator compensation
mechanism, in accordance with the principles set out in Ar-
ticle 3:

1. Where appropriate,
the Commission shall, acting in
accordance with the procedure referred to in Article 12(2),
adopt and amend guidelines on the following issues relating
compensation
to the
mechanism,
in
Article 3:

in accordance with the principles set out

inter-transmission system operator

(a) details of

the determination of

the transmission system
operators liable to pay compensations for transit flows, in
accordance with Article 3(2);

(a) details of

the determination of

the transmission system
operators liable to pay compensations for cross-border
flows, 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
compensations are to be paid,
in accordance with the
second subparagraph of Article 3(3);

Unchanged

(c) details of methodologies to determine the amount of
transits hosted and exports/imports of electricity made in
accordance with Article 3(5);

(c) details of methodologies to determine the quantity of cross-
border flows hosted and the designation of the amounts of
such flows as originating and/or ending in national trans-
mission systems of individual Member States, in accordance
with Article 3(5);

(d) details of the methodology to determine the costs incurred
as a result of hosting transits of electricity, in accordance
with Article 3(6);

(d) details of the methodology to determine the costs incurred
as a result of hosting cross-border flows, in accordance with
Article 3(6);

(e) the participation of national systems which are intercon-
in accordance with

lines,

nected through direct current
Article 3.

The guidelines shall also determine details of harmon-
2.
isation of the charges applied to generators and consumers
(load) under national tariff systems,
in accordance with the
principles set out in Article 4(2).

(e) details of the treatment in the context of the inter-TSO
compensation mechanism of electricity flows originating
or ending in countries outside the EEA;

(f)

the participation of national systems which are intercon-
in accordance with
nected through direct current
Article 3.

lines,

The guidelines shall also determine the appropriate rules
2.
leading to a progressive harmonisation of the charges applied
to generators and consumers
tariff
systems,
including the reflection of the inter-TSO compen-
sation mechanism in national network charges, in accordance
with the principles set out in Article 4.

(load) under national

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transfer

3. Where appropriate,
the Commission shall, acting in
accordance with the procedure referred to in Article 12(2),
amend the guidelines on the management and allocation of
available
between
of
national systems set out in the Annex,
in accordance with
the principles set out in Articles 5 and 6. 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.

interconnections

capacity

Unchanged

Article 8

National regulatory authorities

regulatory

authorities

for
National
congestion management are set and applied in accordance
with this Regulation and the guidelines adopted pursuant to
Article 7.

and methodologies

the

National regulatory authorities, referred to in Article 22 of
Directive 96/92/EC (1), shall have the responsibility that tariffs
for
for
congestion management are set and applied in accordance
with this Regulation and the guidelines adopted pursuant to
Article 7.

to the network and methodologies

access

Article 9

Provision of information and confidentiality

Unchanged

1. Member States and national regulatory authorities, shall,
on request, provide to the Commission all
information
necessary for the purpose of Articles 3(4) and 7.

authorities,
and national
1. Member States
referred to in Article 22 of Directive 96/92/EC (1), shall, on
request, provide to the Commission all information necessary
for the purpose of Articles 3(4) and 7.

regulatory

In particular, for the purpose of Article 3(4) national regulatory
authorities shall provide on a regular basis costs actually
incurred by national associated with hosting transit flows as
well as the amount of exports and imports made in a given
period. They shall
and
information used for the calculation of those figures.

relevant data

also provide

the

In particular, for the purpose of Article 3(4) and 3(6), national
regulatory authorities shall provide on a regular basis costs
actually incurred by national data and all relevant information
relating to the physical flows in transmission system operators'
networks and the cost of the network.

2. Member States shall ensure that national regulatory auth-
orities and administrations are able and entitled to provide the
information required pursuant to paragraph 1.

Unchanged

The Commission may also request

information
3.
necessary for the purpose of Article 3(4) and 7 directly from
undertakings and associations of undertakings.

all

The Commission may also request

information
3.
necessary for the purpose of Article 3(4) and 7 directly from
undertakings concerned and associations of undertakings.

all

When sending a request for information to an undertaking or
an association of undertakings, the Commission shall at the
same time forward a copy of the request to the regulatory
authorit, established pursuant
to Article 22(1) of Directive
96/92/EC, of the Member State in whose territory the seat of
the undertaking or the association of undertakings is situated.

When sending a request for information to an undertaking or
an association of undertakings, the Commission shall at the
same time forward a copy of the request to the national regu-
latory authorities, established pursuant
to Article 22(1) of
Directive 96/92/EC, of the Member State in whose territory
the seat of the undertaking or the association of undertakings
is situated.

___________
(1) Directive as amended by Directive . . .

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4.
In its request for information, the Commission shall state
the legal basis of the request, the time-limit within which the
information is to be provided, the purpose of the request, and
also the penalties provided for in Article 11(2) for supplying
incorrect, incomplete and misleading information.

4.
In its request for information, the Commission shall state
the legal basis of the request, the time-limit within which the
information is to be provided, the purpose of the request, and
also the penalties provided for in Article 11(2) for supplying
information. The
incorrect,
Commission shall
taking into
account the complexity of the information required and the
urgency with which the information is needed.

and misleading
fix a reasonable time limit

incomplete

5.
The owners of the undertakings or their representatives
and, in the case of legal persons, companies of firms, or of
associations having no legal personality, the persons authorised
to represent them by law or by their constitution, shall supply
the information requested. Lawyers duly authorised to act may
supply the information on behalf of their clients, in which case
the client shall remain fully responsible if
the information
supplied is incomplete, incorrect or misleading.

Unchanged

the

6. Where an undertaking or association of undertakings
does not provide
information requested within the
time-limit fixed by the Commission or supplies incomplete
information,
the Commission shall by decision require the
information to be provided. The decision shall specify what
information is required and fix an appropriate time-limit
within which it
indicate the
to be supplied.
penalties provided for in Article 11(2). It shall also indicate
the right
to have the decision reviewed by the Court of
Justice of the European Communities.

shall

is

It

The Commission shall at the same time send a copy of its
decision to the regulatory authorit
referred to in in the
second subparagraph of paragraph 3 the Member State
within the territory of which the residence of the person or
the seat of the undertaking or the association of undertakings is
situated.

The Commission shall at the same time send a copy of its
decision to the national regulatory authorities referred to in
Article 22(1) of Directive 96/92/EC of
the Member State
within the territory of which the residence of the person or
the seat of the undertaking or the association of undertakings is
situated.

Information collected pursuant to this Regulation shall be

7.
used only for the purposes of Articles 3(4) and 7.

Unchanged

The Commission shall not disclose information acquired
pursuant to this Regulation of the kind covered by the obli-
gation of professional secrecy.

Article 10

Right of Member States to provide for more detailed
measures

This Regulation without prejudice to the rights of Member
States to maintain or introduce measures that contain more
detailed provisions than those set out in this Regulation and
the guidelines referred to in Article 7.

This Regulation shall be without prejudice to the rights of
Member States
that
contain more detailed provisions than those set out in this
Regulation and the guidelines referred to in Article 7.

introduce measures

to maintain or

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Article 11

Penalties

Unchanged

1.
The Member States shall lay down the rules on penalties
applicable to infringements of the provisions of this Regulation
and shall take all measures necessary to ensure that they are
implemented. The penalties provided for must be effective,
proportionate and dissuasive. The Member States shall notify
those provisions to the Commission by [indicate date] at the
latest and shall notify it without delay of any subsequent
amendment affecting them.

the total
intentionally or negligently,

2.
The Commission may by decision impose on under-
takings or associations of undertakings fines not exceeding
turnover in the preceding business year
1 % of
they supply incorrect,
where,
incomplete or misleading information in response to a
request made pursuant
to supply
information within the time-limit fixed by a decision adopted
pursuant to the first subparagraph of Article 9(6).

to Article 9(3) or

fail

In setting the amount of a fine, regard shall be had both to the
gravity and to the duration of the infringement.

Penalties provided for pursuant

3.
decisions taken pursuant
criminal law nature.

to paragraph 1 and
to paragraph 2 shall not be of

Article 12

Regulatory Committee

Committee

1.
The Commission shall be assisted by a Committee
composed of the representatives of the Member States and
chaired by the representative of the Commission.

Unchanged

2. Where reference is made to this paragraph, the regulatory
procedure laid down in Articles 5 of Decision 1999/468/EC
shall apply, in compliance with Article 7 and Article 8 thereof.

2. Where reference is made to this paragraph, Articles 5 and
7 of Decision 1999/468/EC shall apply, having regard to the
provisions of Article 8 thereof.

The period provided for in Article 5(6) of Decision

3.
1999/468/EC shall be two months.

The period provided for in Article 5(6) of Decision

3.
1999/468/EC shall be set at three months.

4. Where reference is made to this paragraph, Articles 3 and
7 of Decision 1999/468/EC shall apply, having regard to the
provisions of Article 8 thereof.

Article 13

Advisory committee

Article 13

Commission report

1.
The Commission shall be assisted by a committee
composed of the representatives of the Member States and
chaired by the representative of the Commission.

2. Where reference is made to this paragraph, the advisory
procedure laid down in Article 3 of Decision 1999/468/EC
shall apply, in compliance with Article 7 and Article 8 thereof.

the Regulation has been successful

this
The Commission shall monitor the implementation of
Regulation.
It shall submit to the European Parliament and
the Council no more than three years after the entry into
force of this Regulation a report on the experience gained in
its application. In particular the report shall examine to what
in ensuring
extent
access
non-discriminatory
conditions for cross-border exchanges of electricity in order
in a well-functioning
to contribute
internal market and to long-term security of
If
necessary,
the report shall be accompanied by appropriate
proposals and/or recommendations.

cost-reflective

to customer

network

supply.

choice

and

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Article 14

Entry into force

AMENDED PROPOSAL

Unchanged

This Regulation shall enter into force on the twentieth day
following that of its publication in the Official Journal of the
European Communities.

It shall apply from [indicate date].

This Regulation shall be binding in its entirety and directly
applicable in all Member States.

GUIDELINES ON THE MANAGEMENT AND ALLOCATION OF AVAILABLE TRANSFER CAPACITY OF
INTERCONNECTIONS BETWEEN NATIONAL SYSTEMS

ANNEX

General

Unchanged

1. Congestion management method(s)

implemented by Member
States should deal with short-run congestion in an economically
simultaneously providing signals or
efficient manner whilst
incentives for efficient network and generation investment in the
right locations.

2. In order to minimise the negative impact of congestion on trade,
the current network should be used at the maximum capacity that
complies with the safety standards of secure network operation.

Deleted

3. The TSOs should provide non-discriminatory and transparent
congestion management
they will apply under which circumstances. These
should be

standards, which
methods
standards,
security standards,
described in open and publicly available documents.

together with the

describe which

2. The TSOs should provide non-discriminatory and transparent
congestion management
they will apply under which circumstances. These
should be

standards, which
methods
standards,
security standards,
described in open and publicly available documents.

together with the

describe which

4. Different treatment of the different types of cross-border trans-
actions, whether they are physical bilateral contracts or bids into
foreign organised markets, should be kept to a minimum when
congestion
designing
management. The method for allocating scarce transmission
capacity must be transparent. Any differences in how transactions
are treated must be shown not to distort or hinder the devel-
opment of competition.

specific methods

rules

the

for

of

3. Different treatment of the different types of cross-border trans-
actions, whether they are physical bilateral contracts or bids into
foreign organised markets, should be kept to a minimum when
congestion
designing
management. The method for allocating scarce transmission
capacity must be transparent. Any differences in how transactions
are treated must be shown not to distort or hinder the devel-
opment of competition.

specific methods

rules

the

for

of

5. Price signals that result
should be directional.

from congestion management systems

4. Price signals that result
should be directional.

from congestion management systems

6. Every effort should be made to net the capacity requirements of
any power flows in opposite direction over the congested tie line
in order to use the congested tie line to its maximum capacity. In
any adopted congestion management scheme, transactions that
relieve the congestion should never be denied.

Deleted

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AMENDED PROPOSAL

7. Any unused capacity must become available to other agents (the
use-it-or-lose-it principle). This may be implemented by devising
notification procedures.

8. Any rents

resulting from the allocation of

interconnection
capacities may be used for redispatching or counter trading in
order to comply with the firmness of
the capacity that was
In principle, any remaining rents
allocated to market parties.
should be spent on network investments
relieving the
for
congestion or on reducing the total network tariff. TSOs may
manage these funds, but cannot retain them.

9. TSOs should offer transmission capacity to the market as ‘firm’ as
possible. A reasonable fraction of the capacity may be offered to
the market under condition of decreased firmness, but at all times
the exact conditions for transport over cross-border lines should
be made known to market parties.

5. TSOs should offer transmission capacity to the market as ‘firm’ as
possible. A reasonable fraction of the capacity may be offered to
the market under condition of decreased firmness, but at all times
the exact conditions for transport over cross-border lines should
be made known to market parties.

10. Considering the fact that the European continental network is a
highly meshed network and that the use of interconnection lines
has an effect on the power flows on at least two sides of a national
border, national Regulators
shall ensure that no congestion
management procedure with significant effects on power flows
in other networks, be devised unilaterally.

6. Considering the fact that the European continental network is a
highly meshed network and that the use of interconnection lines
has an effect on the power flows on at least two sides of a national
border, national Regulators
shall ensure that no congestion
management procedure with significant effects on power flows
in other networks, be devised unilaterally.

Position of long-term contracts

Unchanged

1. Priority access rights to an interconnection capacity can not be
assigned to those contracts which violate Articles 81 and 82 of
the EC Treaty.

2. Existing long-term contracts shall have no pre-emption rights when

they come up for renewal.

Provision of information

1. TSOs should implement appropriate coordination and information

exchange mechanisms to guarantee security of the network.

2. TSOs should publish all relevant data concerning the cross-border
total transfer capacities. In addition to the winter and summer ATC
transfer capacity for each day should be
values, estimates of
published by the TSOs at several time intervals before the day of
transport. At least accurate week-ahead estimates should be made
available to the market and the TSOs should also endeavour to
provide month-ahead information. A description of the firmness
of the data should be included.

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AMENDED PROPOSAL

3. The TSOs should publish a general scheme for calculation of the
total transfer capacity and the transmission reliability margin based
upon the electrical and physical realities of the network. Such a
scheme should be subject to approval by the regulators of the
involved Member States concerned. The safety standards and the
operational and planning standards should form an integral part
of the information that TSOs should publish in open and public
documents.

Preferred methods for congestion management

Principles governing methods for congestion management

1. Network congestion problems should in principle be addressed with
market-based solutions. More specifically, congestion management
solutions are preferred which give appropriate price signals to the
market parties and the TSOs involved.

Deleted

2. Network congestion problems should preferentially be solved with
non-transaction based methods, i.e. methods that do not involve a
selection between the contracts of individual market parties.

1. Network congestion problems should preferentially be solved with
non-transaction based methods, i.e. methods that do not involve a
selection between the contracts of individual market parties.

3. The system of market splitting, as used in the Nordpool area, is the
congestion management procedure that, in principle, best meets this
requirement.

2. The system of market splitting, as used in the Nordpool area, is the
congestion management procedure that, in principle, best meets this
requirement.

4. In the short term, however, methods for congestion management in
Continental Europe that may be used are implicit and explicit
auctions and cross-border coordinated redispatching.

3. In the short term, however, methods for congestion management in
Continental Europe that may be used are implicit and explicit
auctions and cross-border coordinated redispatching.

5. Cross-border coordinated redispatching or counter trading may be
used jointly by the concerned TSOs. The costs that TSOs incur in
counter-trading and redispatching must, however, be at an efficient
level.

4. Cross-border coordinated redispatching or counter trading may be
used jointly by the concerned TSOs. The costs that TSOs incur in
counter-trading and redispatching must, however, be at an efficient
level.

6. Transaction curtailment,

following pre-established priority rules,
should be left only for emergency situations where the TSOs
in an expeditious manner and redispatching is not
must act
possible.

Deleted

7. The possible merits of a combination of market splitting for solving
‘permanent’ congestion and counter trading for solving temporary
congestion should be immediately explored as a more permanent
approach to congestion management.

5. The possible merits of a combination of market splitting for solving
‘permanent’ congestion and counter trading for solving temporary
congestion should be immediately explored as a more permanent
approach to congestion management.

Guidelines for explicit auctions

Unchanged

1. The auction system must be designed in such a way that all
available capacity is being offered to the market. This may be
done by organising a composite auction in which capacities are
auctioned for differing duration and with different characteristics
(e.g. with respect
the available
capacity in question).

to the expected reliability of

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INITIAL PROPOSAL

AMENDED PROPOSAL

2. Total

interconnection capacity should be offered in a series of
auctions, which, for instance, might be held on a yearly, monthly,
weekly, daily and intra-daily basis, according to the needs of the
should allocate a
markets
prescribed fraction of
the available transfer capacity plus any
remaining capacity that was not allocated in previous auctions.

involved. Each of

these auctions

3. The explicit auction procedures should be prepared in close colla-
boration between the national regulatory authority and the TSO
concerned and designed in such a way as to allow bidders to
participate also in the daily sessions of any organised market (i.e.
power exchange) in the countries involved.

4. The power flows in both directions over congested tie lines should
in principle be netted in order to maximise the transport capacity in
the direction of the congestion. However, the procedure for netting
of flows should comply with safe operation of the power system.

5. In order to offer as much capacity to the market as possible, the
financial risks related to the netting of flows, should be attributed to
those parties causing those risks to materialise.

6. Any auction procedure adopted should be capable of sending direc-
tional price signals to market participants. Transports in a direction
opposite the dominant power flow relieve the congestion and
should therefore result in additional transport capacity over the
congested tie line.

7. In order not to risk creating or aggravating problems related to any
dominant position of market player(s), capping of the amount of
capacity that can be bought/possessed/used by any single market
in an auction should be seriously considered by the
player
competent regulatory authorities in the design of an auction mech-
anisms.

8. To promote the creation of

liquid electricity markets, capacity
bought at an auction should be freely tradeable before the
moment of notification. until
it is notified to the TSO that the
capacity bought will be used.

8. To promote the creation of

liquid electricity markets, capacity
bought at an auction should be freely tradeable until it is notified
to the TSO that the capacity bought will be used.