Opinion of the European Economic and Social Committee on the Communication from the Commission — Trans-European networks: Towards an integrated approach COM(2007) 135 final
Date: 2008-03-13
Institutions: European Economic and Social Committee
Subjects: common transport policy, energy grid, environmental protection, investment protection, public-private partnership, trans-European network, transmission network, transport network

9.8.2008

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Opinion of the European Economic and Social Committee on the Proposal for a Directive of the
European Parliament and of the Council on co-ordination of safeguards which, for the protection of
the interests of members and third parties, are required by Member States of companies within the
meaning of the second paragraph of Article 48 of the Treaty, with a view to making such safeguards
equivalent (Codified version)

COM(2008) 39 final — 2008/0022 (COD)

(2008/C 204/07)

On 14 February 2008, the Council decided to consult the European Economic and Social Committee, under
Article 95 of the Treaty establishing the European Community, on the

Proposal for a Directive of the European Parliament and of the Council on co-ordination of safeguards which, for the
protection of the interests of members and third parties, are required by Member States of companies within the
meaning of the second paragraph of Article 48 of the Treaty, with a view to making such safeguards equivalent
(Codified version)

Since the Committee unreservedly endorses the proposal and feels that it requires no comment on its part,
it decided, at its 443rd plenary session of 12 and 13 March 2008 (meeting of 12 March), by 125 votes with
6 abstentions, to issue an opinion endorsing the proposed text.

Brussels, 12 March 2008.

The President

of the European Economic and Social Committee

Dimitris DIMITRIADIS

Opinion of the European Economic and Social Committee on the Communication from the
Commission — Trans-European networks: Towards an integrated approach

COM(2007) 135 final

(2008/C 204/08)

On 21 March 2007, the European Commission decided to consult the European Economic and Social
Committee, under Article 262 of the Treaty establishing the European Community, on the

Communication from the Commission — Trans-European networks: Towards an integrated approach

The Section for Transport, Energy, Infrastructure and the Information Society, which was responsible for
preparing the Committee's work on the subject, adopted its opinion on 19 February 2008. The rapporteur
was Mr Krzaklewski.

At its 443rd plenary session, held on 12 and 13 March 2008 (meeting of 13 March 2008), the European
Economic and Social Committee adopted the following opinion by 64 votes with 1 abstention.

1. Conclusions and recommendations

networks and reduce associated construction costs, unlike an
approach that does not take account of the effects of possible
synergy between different kinds of network.

1.1
The European Economic and Social Committee (EESC)
notes that an integrated approach to trans-European networks
(TENs) is one way of achieving the goal of the sustainable devel-
opment of the European Union.

1.2
speed up the

The EESC is convinced that an integrated approach can
implementation of planned trans-European

1.2.1
In that connection, the Committee calls on the Euro-
pean Commission to put forward proposals to broaden the

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financial support for integrated approaches,

in the
scope of
form of an ‘integrated approached fund’
for trans-European
networks (as a whole, i.e. including network branches), ahead of
the forthcoming mid-term review.

1.3
Having assessed the conditions for successfully creating
an integrated approach covering all TENs, the EESC believes
convergence between sectors (1) is needed if synergy is to be
effectively achieved. Another of
in the
Committee's view, for a more effective integrated approach is
the earliest possible completion of the basic structure of these
networks.

the key conditions,

1.4
The EESC suggests broadening the Commission commu-
nication to examine the question of the extent to which the
accession of 12 new Member States has affected the possibility
of adopting an integrated approach in these countries and the
scope of its application.

The Committee notes that an integrated approach to
1.5
trans-European networks can play a very important role, namely
by:

approach to local network infrastructure based on an IT system
(intelligent infrastructure management system — IIMS).

The Committee proposes that

1.8
the Commission take
account of integrated technologies for renewable natural gas and
environmentally-friendly energy generation in its plans for an
integrated approach to trans-European networks. These technol-
ogies, which bring electricity generation closer to the end user,
can cut CO2 emissions.

1.8.1
This approach should aim to yield results in terms of
synergy, coordination and savings, possible through the develop-
ment of gas and biotechnologies.

synergy of

Considering the potential

1.9
trans-European
energy networks in the Baltic states as new EU members, the
EESC believes that the integrated approach should adopt one
particular measure that can be implemented quickly and
construct an energy bridge to integrate the systems of the Baltic
States with those of
the EU. Over the longer term (2020),
however, it is important that stranded costs (4) do not arise from
existing transmission networks.

— limiting environmental damage caused by the construction

2. Introduction

and operation of networks, and;

— reducing the number and severity of disputes sparked by
conflicts of interest involving the construction and operation
of networks.

The EESC considers that scientific research comprising
1.6
both Community and national
initiatives has a particularly
important role to play in optimising the effects of an integrated
approach to trans-European networks. In this connection, the
Committee notes that current research is split along thematic
and sectoral lines. The EESC therefore calls on the Commission
and the Council to devise and implement programmes and
applications throughout the area of European scientific research
in connection with synergies between all the different kinds of
network making up the TENs.

Developing, connecting, better

2.1
integrating and better
coordinating the development of European energy, transport
and telecommunications infrastructures are ambitious objectives
and are referred to in the Treaty (5) and the Guidelines for
growth and jobs (6) based on the Lisbon Strategy.

2.2
Articles 154-156 of the Treaty and the Guidelines for
growth and jobs contain objectives for developing, connecting,
better integrating and coordinating European energy, transport
and telecommunications infrastructures.

2.3
These provisions in the Treaty and the above-mentioned
guidelines formed the basis for the idea of trans-European trans-
port, energy and telecommunications networks, which are the
lifeblood of the EU economy.

Given that a ‘backbone’ of fibre-optic networks exists in
1.7
some EU Member States to meet the technological needs of
certain national infrastructures (such as the electricity and rail
networks), the EESC is convinced that, if an integrated approach
is to be adopted, these fibre-optic networks will have to be used
to a greater extent for commercial purposes (telecommunication
services, transmitting information etc.).

2.4 With a view to reaping the greatest possible benefit from
trans-European networks, particularly in terms of making the
EU more competitive, in July 2005 the European Commission
mandated a steering group especially set up for this purpose to
define a common approach to better coordinate the various
Community initiatives supporting work on the trans-European
transport, energy and telecommunications networks.

1.7.1
At the same time, the Committee believes that, with an
eye to adopting an integrated approach, the active development
of local infrastructure currently under way in a large number of
Member States should be used to step up development of fibre-
optic access networks and construct intelligent (2) local
infra-
structure. An integral part of this infrastructure should be an
integrated GIS map (3). This would result
in an integrated

(1) Organisational convergence of sectors, encompassing businesses.
(2) Intelligent infrastructure has attached or built-in components that
are able to collect and transmit information about the state of the infra-
structure to a central computer, and in some cases receive back instruc-
tion from the computer, which triggers controlling devices. (U of T Civil
Engineering — last updated: Nov. 9, 2001).

(3) See specific comments, point 4.2.3

2.4.1
particular:

The Steering Group examined the following matters in

— Synergy between European networks

— Respect

for the natural environment and trans-European

networks

(4) Stranded costs — costs of investments and commitments incurred
exclusively in the past (historic costs) which have yet to be recovered by
investors through the sale of electricity and other services and which
cannot be recovered on the competitive market. The cut-off date is
generally the date on which the energy market was established or liber-
alised.

(5) Articles 154, 155 and 156 of the Treaty.
(6) Guidelines for growth and jobs (2005-2008) No 9, 10, 11 and 16.

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— Making use of new technologies in trans-European transport

networks

— Funding for trans-European networks, and in that connec-

tion:

— Combining funds

— Funding for major priority projects

— Using public-private partnerships (PPP) to finance trans-

European networks.

The subject of the EESC opinion below is the Commis-
2.5
sion's Communication COM(2007) 135 final Trans-European
networks: Towards an integrated approach — the result of
the
Steering Group's work.

3. General considerations

trans-European transport network projects during the 2007-
2013 programming period. In general terms, the Community
contribution to the implementation of the trans-European trans-
port network should be concentrated on the cross-border
sections and on bottlenecks.

The European Investment Bank will continue to
3.1.6
provide funding for transport
infrastructure in the form of
loans and through a specific guarantee instrument which has a
budget of EUR 500 million under the EIB's own funds and
EUR 500 million under the trans-European transport network's
budget (i.e. 6,25 % of the total amount available).

3.2 Trans-European energy network (TEN-E)

situation regarding the implementation of

trans-European

Current
networks

3.1 Trans-European transpor t network (TEN-T)

3.2.1
In January 2007, the Commission assessed the progress
made on projects of European interest in its priority interconnec-
tion programme. In the case of electricity, little progress has been
made — 12 out of 32 projects are on schedule, and only five
are actually complete (11).

Following the most recent EU enlargement in 2007,
3.1.1
TEN-T now comprises 30 priority projects which should be
completed by 2020. Furthermore, the Commission has recently
underlined the necessity to extend the trans-European transport
network to the neighbouring countries (7).

3.1.2
The completion dates for these major projects have
fallen behind the original timetables. Despite the fact that some
of these projects have been completed or are currently nearing
completion (8), the pace of construction of what are considered
to be priority transport routes is still too slow. The EESC own-
initiative opinion (9) describes in detail the reasons for this.

3.1.3
Of these 30 priority projects, 18 are railway projects, 2
are inland waterways and shipping projects. High priority has
therefore been given to the most environmentally friendly trans-
port modes. Maps contained in a study carried out by ECORYS
for the Commission (10) show the progress made on the 30
priority projects to date and the progress which should be made
by the end of the multi-annual financial framework period in
2013. These maps show how incomplete the network still is.

The Commission's Communication (subject of

3.1.4
this
opinion) assesses the financial resources used to implement
TEN-T during the 2000-2006 financial period and presents the
financial mechanisms under the 2007-2013 multi-annual finan-
cial framework. The sum of EUR 8,013 billion was allocated
directly from the EU budget for the development of the trans-
European transport network in this financial period.

3.1.5
The ERDF and the Cohesion Fund will continue to be
the main sources of Community assistance for co-funding of the

(7) COM(2007) 32 of 31.1.2007.
(8) The fixed link connecting Sweden and Denmark, completed in 2000,
Malpensa airport, completed in 2001, the Betuwe railway line linking
Rotterdam to the German border, completed in 2007 and the PBKAL
project
(HST Paris-Brussels/Brussels-Cologne-Amsterdam-London,
completed in 2007).

(9) OJ C 157 of 28 June 2005 p. 130.
(10) Synergies between Trans-European Networks, Evaluations of potential areas

for synergetic impacts, ECORYS, August 2006.

3.2.2
As far as gas is concerned, the situation appears to be
better — seven out of ten projects should be ready by 2010-
2013. On the other hand, 29 LNG (12) terminals and storage
facilities are behind schedule — nine projects have been aban-
doned, work on five has stopped.

3.2.2.1
The Commission identified the complexity of plan-
ning and other authorisation procedures as the main reason for
the delays and shortcomings. Other reasons include opposition
from public opinion,
insufficient financial resources and the
structure of vertically integrated energy companies.

The EU will need to invest, before 2013, at

3.2.3
least
EUR 30 billion in infrastructure (EUR 6 billion for electricity
networks, EUR 19 billion for gas pipelines and EUR 5 billion
the priorities
for Liquefied Natural Gas (LNG)
outlined are to be fully implemented. Investment is essential not
only in cross-border capacity but also generation capacity.

terminals),

if

The EU budget offers financial support

for TEN-E
3.2.4
investments, which can be provided only in special and duly
justified cases. Funding comes from the budget heading exclu-
sively earmarked for trans-European networks and from the
Cohesion and Structural Funds. (The funds represent over one
third of the budget and their purpose is to finance regional
development projects, including energy networks.)

Investments are also supported through other financial
3.2.5
instruments (funds, credit). The European Investment Bank is
the main source of funding for trans-European networks. From
1993 until the end of 2005 credit agreements provided a total
of EUR 69,3 bn in funding for all trans-European networks, of
which EUR 9,1 bn went to energy networks.

(11) Aleksandra Gawlikowska-Fryk: Trans-European Energy Networks, 2007.
(12) LNG — Liquid Natural Gas.

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3.3 Trans-European telecommunications networks

Of all the TEN networks, the construction of the infra-
3.3.1
structure for telecommunications networks (eTEN) is the most
advanced. Telecommunications services have been progressively
opened to competition since 1988 and the impact has been
dramatic. More competition has stimulated investment, innova-
tion, the emergence of new services and a significant decline in
consumer prices.

3.3.2
Nowadays, investment is concentrating on the upgrade
of existing networks to next generation, the deployment of 3rd
generation mobile
and
and other wireless
bringing broadband to the rural areas of the EU.

infrastructure,

3.4.2.1
Apart from the possibility of combining gas pipelines
with other infrastructures, where technical feasibility seems diffi-
cult in view of the extent of the secure areas required, there are
genuine advantages to be gained from combining other kinds of
TENs.

Synergies between the telecommunications and trans-
3.4.2.2
port networks seem to be the most promising. Every transport
network can be optimised by having its own communication
network which is used to manage the network. In most cases,
rail and motorway networks already have such communication
networks. In some cases, the surplus capacity of these networks
is used for other purposes, e.g. for data communication.

fibre-optic
Investment may involve the layout of
3.3.2.1
networks, where civil works and indoor cabling represent 70 %
of deployment costs. Construction of railway lines, roads or
energy lines may facilitate the rollout of
these networks in
under-served areas.

It is still rare for systematic synergies to be sought
3.4.2.3
between an infrastructure management network and a telecom-
munications network from the start of construction of the infra-
structure.

3.3.3
The main challenge for the European telecommunica-
tions network is ‘bridging the broadband gap’. There are dispari-
ties between urban and rural areas and Member States must
therefore undertake concrete actions and set targets to close the
gap by 2010.

3.3.4
A greater coordination and integration of various
sources of funding (Structural Funds, Rural Development Fund,
TEN and national funds) is needed to develop coherent planning
and complete the coverage of broadband.

Integrated approach for trans-European networks

3.4 Synergies between European networks

3.4.1
Combining road and rail networks is the first example
of synergy in trans-European networks (13). The merits of this
are set out in the Commission Communication on Extension of
the major trans-European transport axes to the neighbouring countries:
Guidelines for transport in Europe and neighbouring regions (14). The
most
joint construction
work,
impact on and less fragmentation of the
landscape, measures to soften the impact of joint infrastructures
(anti-noise protection, viaducts for large and small wildlife).
Combined infrastructures also offer genuine scope for reducing
costs and environmental damage.

important are: better use of space,
lower visual

A study has been carried out into the scope for devel-
3.4.2
oping other combined networks, such as passing a high-voltage
line through a railway tunnel, and laying telecommunications
cables — specifically fibre-optic cables — by railway lines (15).
Technical
the impact on project costs and the
the procedures have been analysed, with the
complexity of
following conclusions.

feasibility,

(13) Some Member States have introduced a legal obligation to seek
synergy, in particular Germany — Federal Nature Conservation Act
(Bundesnaturschutzgesetz), paragraph 2, Bundling law (Bündelungsgebot).

(14) COM(2007) 32 of 31.1.2007.
(15) Synergies between Trans-European Networks, Evaluations of potential

areas for synergetic impacts, ECORYS, August 2006.

3.4.2.4
Interesting solutions involving the interconnection of
electricity networks and transport and telecommunications
infrastructure include the following: laying high-voltage cables
along the banks of canals and rivers, low-voltage interconnec-
tions
(2 x 25 kV) along high-speed railway lines, more
systematic interconnections of underground high-voltage lines
(300 to 700 kV) along transport network paths. These sugges-
tions do not replace the immediate need to interconnect the
national high-voltage networks, but are a proposal for finer
meshing of the national electricity systems over a longer time
span matching the time it takes to complete the major infra-
structure projects.

3.5 Integrating the environment and the trans-Euro-

pean network s

3.5.1
The Lisbon Strategy for Growth and Jobs calls for the
TENs to be implemented in a manner which is compatible with
sustainable development.

3.5.2
The majority of TEN-T priority projects are projects
which promote more environmentally friendly transport modes
and which consume less energy, such as the railways and water-
ways. The completion of the trans-European transport network
will have a positive impact on the environment. If transport-
generated CO2 emissions continue to increase at the present
rate, by 2020 they will be 38 % above present levels. In the
Commission's opinion, completing the 30 priority projects will
to reducing
slow down this rise by about 4 %, equivalent
CO2 emissions by 6,3 million tonnes a year.

By interconnecting the national power systems and
3.5.3
connecting the renewable energy sources to them it will be
possible to optimise capacity utilisation in each Member State
and thereby soften the negative environmental impact.

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protection

Community

3.5.4
legislation
environmental
provides a clear framework in which these major projects have
to be implemented. The Community guidelines for the develop-
ment of the trans-European transport network refer to it expli-
citly (16). Each new TEN infrastructure programme has
to
undergo a strategic environmental assessment (17), and each
project has to be assessed on an individual basis (18). There is
also the possibility of using the assessments as a framework for
study to find possible synergies.

actual construction of the railway line could be funded by the
ERDF or the Cohesion Fund. Projects could also be divided into
geographical sections, which could be co-financed either by
ERDF/Cohesion Fund or TEN-funding.

4. Specific comments

3.5.5
legislation on noise, water and the protection of
fauna (19).

Each individual project has to comply with Community
flora and

4.1 Integrated approach to developing energy networks: electricity and

gas

3.5.6
If none of the alternatives to a project declared to be in
the public interest is considered to be an optimum solution and
in line with Community legislation, compensatory measures
may be adopted which will allow the project to be carried out
while at the same time compensating for any negative impact.

4.1.1
The development of gas-powered generation technolo-
gies (combi technologies (20), cogeneration (21)) is making invest-
ment in electricity networks a riskier proposition (transmission
of electricity is being replaced by transport of natural gas and
development of gas-powered cogeneration at local level, small-
scale cogeneration, micro-cogeneration).

3.6 Integrated approach for

financing trans-Euro-

pean network s

3.6.1
Combining funds for the implementation of TEN has
led to major problems and even disputes. The question of
cumulation of Community funding of various financing sources
on the same project has been a constant preoccupation of the
Commission. The Court of Auditors has highlighted this issue in
its reports on the Commission's implementation of the trans-
European networks.

3.6.2
In the Communication, which is the subject of this
EESC opinion, the Steering Group concludes that there must be
no possibility of cumulation of subsidies from several Com-
munity funds. In order to ensure budgetary transparency and
proper financial management, the Financial Regulation and/or
basic sectoral acts adopted or in the course of adoption rule out
the cumulation of different Community financial
instruments
for one and the same action.

3.6.3
The key point in the Communication, which has major
consequences for combined TEN investments, is that expendi-
ture within a project that is part of an operational programme
receiving financial assistance from the Structural Funds and/or
the Cohesion Fund cannot benefit
from other Community
funding.

It follows that when expenditure, for example for
3.6.3.1
ERTMS equipment or electrification of a railway line,
is not
receiving financial assistance from the Structural Funds and/or
it could benefit from TEN-funding. The
the Cohesion Fund,

(16) Article 8 of the abovementioned Decision No 884/2004/EC.
(17) Strategic Environmental Assessment (SEA) Directive (2001/42/EC) for

plan and programme assessment.

(18) Environmental Impact Assessment (EIA) Directive (85/337/EEC as
amended by Directives 97/11/EC and 2003/35/EC) for project assess-
ment.

(19) Birds Directive (79/409/EEC), Habitats Directive (92/43/EEC) and

Water Framework Directive (2000/60/EC).

4.1.2
The development of new technologies for transporting
gas is making investment in gas networks a riskier proposition
(network transmission of natural gas is being replaced by sea
and road transport, made possible through use of CNG (22) and
LNG technologies).

The convergence of

4.1.3
the electricity and gas sectors
(companies in these sectors), i.e. convergence in terms of owner-
ship, management and organisation, is a prerequisite for an inte-
grated technological approach to use of natural gas, and electri-
city and heat generation. There is therefore an urgent need to
break down the sectoral divide (move away from the mutual
isolation of the electricity and gas industries). It is particularly
important to speed up convergence of the electricity and gas
sectors in the new EU Member States of Central and Eastern
Europe, while taking account of the inevitable social conse-
quences in the Member States concerned, both ‘old’ and ‘new’.

4.2 Integrated approach to developing fibre-optic networks

including

technological needs

In some Member States,

4.2.1
several new
members (e.g. Poland), major fibre-optic networks have been
(elec-
constructed to meet particular
tricity (23) and rail (24)). Although use of
these networks for
commercial purposes is increasing (25), the significant potential
for integration has yet to be exploited. This untapped potential
is still present, for example, in the gas industry. However, the
fibre-optic
main potential
networks of various infrastructures (electricity, rail) with the tele-
communications network to form an efficient access network.

in integrating the technical

lies

(20) ‘Gas/steam units each capable of generating between a few dozen and
200 MW’ Jan Popczyk, ‘What next for electricity?’, Monthly magazine
of the Polish Electricians Association, VI 2000.

(21) See footnote No. 25.
(22) CNG — compressed natural gas (20-25 MPa).
(23) An example is the Polish fibre-optic network TelEnergo.
(24) An example is the Polish fibre-optic network Telekomunikacja Kolejowa

— Grupa PKP.

(25) An example of this in Poland is the merger of TelEnergo and Telbank,
which led to the creation of Exatel, a modern company in the telecom-
munications and IT services market.

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(electricity and heat) and to utilise waste (use of municipal
waste, agricultural waste and waste from food processing).

4.4 Integrated approach to financing infrastructure networks through

public/private partnership

The aim of

integrated financing of

4.4.1
infrastructure
through public-private partnerships is to make more effective
use of EU funds for infrastructure development, particularly in
the new Member States.

4.4.2
Public-private partnerships in the old Member States
(EU-15) have been used to finance major infrastructure projects.
In the new Member States of Central and Eastern Europe, these
partnerships should be used to finance small-scale infrastructure
investment at local level. For this reason, it is becoming increas-
ingly important to apply the experience of partnerships in the
old Member States to the new members. However, it is impor-
tant to bear in mind that direct transfer of experience is not
possible, as direct parallels cannot be drawn between financing
major one-off
infrastructure projects and funding a large
number of small projects).

As a result of the availability of EU funds, local authori-
4.4.3
ties in some Member States including Central and Eastern Euro-
pean countries often allow overinvestment
in infrastructure,
especially water and sewage works, while not exploiting the
potential for sectorally integrated investment. This is a serious
cause for concern because opportunities to reduce expenditure
on infrastructure investment are being missed (less effective use
of EU funds) and local authorities are increasingly being saddled
with the unjustified future costs of operating this over-invested
infrastructure (increase in ongoing costs of using this infrastruc-
ture, borne by local residents). The use of private capital to
finance infrastructure is an effective way of exploiting the poten-
tial for integration and curbing the risk of overinvestment.

The President

of the European Economic and Social Committee

Dimitris DIMITRIADIS

States, particularly

4.2.2 Many EU Member
the new
members, are currently taking active steps to build up local
infrastructure, such as waterworks and sewage systems, co-
financed from EU funds, mainly the Regional Development and
Cohesion Funds. This represents a unique opportunity to inte-
grate this infrastructure into fibre-optic access networks and
would be a huge step forward for rural areas and small towns in
Europe. This integration could be supported by introducing
incentives in connection with EU funding for local infrastructure
development, such as promoting the construction of integrated
infrastructure.

sewage systems,

4.2.3
The fibre-optic access network could provide the basis
for constructing intelligent local infrastructure, covering (tech-
nical) control of various (intelligent) infrastructure components
transport, heating networks,
(waterworks,
public safety) and their management
technical
supervision and in the services market). An integral part of
intelligent local infrastructure should be an integrated GIS map
(administered by the commune/district and accessible to infra-
structure companies operating in the local area). The GIS map
currently offers the greatest potential for integration of
local
infrastructure networks.

(in terms of

4.3 The integrated approach and the issue of renewable natural gas

and environmentally-friendly energy production

Renewable natural gas technologies (small-scale, cogen-
4.3.1
eration technologies (26), which gasify biomass produced on
large farms) make it possible to limit expansion of electricity
networks and the losses they entail and to make better use of
primary energy sources, thereby cutting CO2 emissions.

A very important category of integrated technologies
4.3.2
are
(environmentally-
friendly/cogeneration) which are designed to generate energy

environmentally-friendly

technologies

Brussels, 13 March 2008.

(26) Cogeneration (also combined heat and power) is a technical process
which involves simultaneously generating electricity and useful heat in
a power station.