Third Party Access (TPA) principle in district heating and cooling sector is expressed in Article 24(4b) of the RED III, which stipulates that the EU Member States must ensure that operators of district heating or cooling systems above 25 MWth capacity are encouraged to connect third party suppliers of energy from renewable sources and from waste heat and cold or are encouraged to offer to connect and purchase heat or cold from renewable sources and from waste heat and cold from third-party suppliers on the basis of non-discriminatory criteria set by the competent authority of the Member State concerned, where such operators need to do one or more of the following:
(a) meet demand from new customers;
(b) replace existing heat or cold generation capacity;
(c) expand existing heat or cold generation capacity.
|
|
18 October 2023
|
It is visible, that the said provision is rather flexible formulated, in particular words: "are encouraged" are only used.
It is to be noted that the European Commission draft RED III (Proposal of 14 July 2021 for a Directive of the European Parliament and of the Council amending Directive (EU) 2018/2001 of the European Parliament and of the Council, Regulation (EU) 2018/1999 of the European Parliament and of the Council and Directive 98/70/EC of the European Parliament and of the Council as regards the promotion of energy from renewable sources, and repealing Council Directive (EU) 2015/652 (COM(2021) 557 final)) used in this context more categorical wording: "are obliged", which apparently has been abandoned in the course of legislative process.
This could happen on account of natural monopolies often occurring in this sector.
Article 24(5) of the RED III grants the EU Member States the right to allow an operator of a district heating or cooling system to refuse to connect and to purchase heat or cold from a third-party supplier in any of the following situations:
(a) the system lacks the necessary capacity due to other supplies of heat or cold from renewable sources or of waste heat and cold;
(b) the heat or cold from the third-party supplier does not meet the technical parameters necessary to connect and ensure the reliable and safe operation of the district heating and cooling system;
(c) the operator can demonstrate that providing access would lead to an excessive heat or cold cost increase for final customers compared to the cost of using the main local heat or cold supply with which the renewable source or waste heat and cold would compete;
(d) the operator’s system is an efficient district heating and cooling system. Member States shall ensure that, when an operator of a district heating or cooling system refuses to connect a supplier of heating or cooling pursuant to the first subparagraph, information on the reasons for the refusal, as well as the conditions to be met and measures to be taken in the system in order to enable the connection, is provided by that operator to the competent authority. Member States shall ensure that an appropriate process is in place to remedy unjustified refusals.
European Commission Proposal of 14 July 2021 for a Directive of the European Parliament and of the Council amending Directive (EU) 2018/2001 of the European Parliament and of the Council, Regulation (EU) 2018/1999 of the European Parliament and of the Council and Directive 98/70/EC of the European Parliament and of the Council as regards the promotion of energy from renewable sources, and repealing Council Directive (EU) 2015/652, COM(2021) 557 final
(13) Article 24 is amended as follows:
…
(c) the following paragraph 4a is inserted:
‘4a. Member States shall ensure that operators of district heating or cooling systems above 25 MWth capacity are obliged to connect third party suppliers of energy from renewable sources and from waste heat and cold or are obliged to offer to connect and purchase heat or cold from renewable sources and from waste heat and cold from third-party suppliers based on non-discriminatory criteria set by the competent authority of the Member State concerned, where such operators need to do one or more of the following:
(a) meet demand from new customers;
(b) replace existing heat or cold generation capacity;
(c) expand existing heat or cold generation capacity.’;
(d) paragraphs 5 and 6 are replaced by the following:
‘5. Member States may allow an operator of a district heating or cooling system to refuse to connect and to purchase heat or cold from a third-party supplier in any of the following situations:
(a) the system lacks the necessary capacity due to other supplies of heat or cold from renewable sources or of waste heat and cold;
(b) the heat or cold from the third-party supplier does not meet the technical parameters necessary to connect and ensure the reliable and safe operation of the district heating and cooling system;
(c) the operator can demonstrate that providing access would lead to an excessive heat or cold cost increase for final customers compared to the cost of using the main local heat or cold supply with which the renewable source or waste heat and cold would compete;
(d) the operator’s system meets the definition of efficient district heating and cooling set out in [Article x of the proposed recast of the Energy Efficiency Directive]. Member States shall ensure that, when an operator of a district heating or cooling system refuses to connect a supplier of heating or cooling pursuant to the first subparagraph, information on the reasons for the refusal, as well as the conditions to be met and measures to be taken in the system in order to enable the connection, is provided by that operator to the competent authority. Member States shall ensure that an appropriate process is in place to remedy unjustified refusals.
6. Member States shall put in place a coordination framework between district heating and cooling system operators and the potential sources of waste heat and cold in the industrial and tertiary sectors to facilitate the use of waste heat and cold. That coordination framework shall ensure dialogue as regards the use of waste heat and cold involving at least:
(a) district heating and cooling system operators;
(b) industrial and tertiary sector enterprises generating waste heat and cold that can be economically recovered via district heating and cooling systems, such as data centres, industrial plants, large commercial buildings and public transport; and
(c) local authorities responsible for planning and approving energy infrastructures.’;
(e) paragraphs 8, 9 and 10 are replaced by the following:
‘8. Member States shall establish a framework under which electricity distribution system operators will assess, at least every four years, in cooperation with the operators of district heating and cooling systems in their respective areas, the potential for district heating and cooling systems to provide balancing and other system services, including demand response and thermal storage of excess electricity from renewable sources, and whether the use of the identified potential would be more resource- and cost-efficient than alternative solutions. Member States shall ensure that electricity transmission and distribution system operators take due account of the results of the assessment required under the first subparagraph in grid planning, grid investment and infrastructure development in their respective territories. Member States shall facilitate coordination between operators of district heating and cooling systems and electricity transmission and distribution system operators to ensure that balancing, storage and other flexibility services, such as demand response, provided by district heating and district cooling system operators, can participate in their electricity markets. Member States may extend the assessment and coordination requirements under the first and third subparagraphs to gas transmission and distribution system operators, including hydrogen networks and other energy networks.
9. Member States shall ensure that the rights of consumers and the rules for operating district heating and cooling systems in accordance with this Article are clearly defined, publicly available and enforced by the competent authority.
10. A Member State shall not be required to apply paragraphs 2 and 9 where at least one of the following conditions is met:
(a) its share of district heating and cooling was less than or equal to 2 % of the gross final energy consumption in heating and cooling on 24 December 2018;
(b) its share of district heating and cooling is increased above 2 % of the gross final energy consumption in heating and cooling on 24 December 2018 by developing new efficient district heating and cooling based on its integrated national energy and climate plan pursuant to Annex I to Regulation (EU) 2018/1999 and the assessment referred to in Article 23(1a) of this Directive;
(c) 90 % of the gross final energy consumption in district heating and cooling systems takes place in district heating and cooling systems meeting the definition laid down in [Article x of the proposed recast of the Energy Efficiency Directive].’
|
Directive (EU) 2018/2001, as amended by Directive (EU) 2023/2413 of the European Parliament and of the Council of 18 October 2023 (RED III)
Article 24 District heating and cooling
1. Member States shall ensure that information on the energy performance and the share of renewable energy in their district heating and cooling systems is provided to final consumers in an easily accessible manner, such as on bills or on the suppliers’ websites and on request. The information on the share of renewable energy shall be expressed at least as a percentage of gross final consumption of energy in heating and cooling assigned to the customers of a given district heating and cooling system, including information on how much energy was used to deliver one unit of heating to the customer or end-user.
2. Member States shall lay down the necessary measures and conditions to allow customers of district heating or cooling systems which are not efficient district heating and cooling systems, or which are not such a system by 31 December 2025 on the basis of a plan approved by the competent authority, to disconnect by terminating or modifying their contract in order to produce heating or cooling from renewable sources themselves. Where the termination of a contract is linked to physical disconnection, such a termination may be made conditional on compensation for the costs directly incurred as a result of the physical disconnection and for the undepreciated portion of assets needed to provide heat and cold to that customer.
3. Member States may restrict the right to disconnect by terminating or modifying a contract in accordance with paragraph 2 to customers who can demonstrate that the planned alternative supply solution for heating or cooling results in a significantly better energy performance. The energy-performance assessment of the alternative supply solution may be based on the energy performance certificate.
4. Member States shall endeavour to increase the share of energy from renewable sources and from waste heat and cold in district heating and cooling by an indicative 2,2 percentage points as an annual average calculated for the period 2021 to 2030, starting from the share of energy from renewable sources and from waste heat and cold in district heating and cooling in 2020, and shall lay down the measures necessary to that end in their integrated national energy and climate plans submitted pursuant to Articles 3 and 14 of Regulation (EU) 2018/1999. The share of energy from renewable sources shall be expressed in terms of share of gross final consumption of energy in district heating and cooling adjusted to normal average climatic conditions. Member States may count renewable electricity used for district heating and cooling in the annual average increase set out in the first subparagraph. Member States shall inform the Commission of their intention to count renewable electricity used in district heating and cooling towards the annual increase set out in first subparagraph of this paragraph. Member States shall include the estimated renewable electricity capacities for district heating and cooling in their integrated national energy and climate plans submitted pursuant to Articles 3 and 14 of Regulation (EU) 2018/1999. Member States shall include the amount of renewable electricity used in district heating and cooling in their integrated national energy and climate progress reports submitted pursuant to Article 17 of that Regulation.
4a. For the calculation of the share of renewable electricity used in district heating and cooling for the purposes of paragraph 4, Member States shall use the average share of renewable electricity supplied in their territory in the two previous years. Member States with a share of energy from renewable sources and from waste heat and cold in district heating and cooling above 60 % may count any such share as fulfilling the average annual increase referred to in paragraph 4, first subparagraph. Member States with a share of energy from renewable sources and from waste heat and cold in district heating and cooling above 50 % and up to 60 % may count any such share as fulfilling half of the average annual increase referred to in paragraph 4, first subparagraph. Member States shall lay down the necessary measures to implement the average annual increase referred to in paragraph 4, first subparagraph, of this Article, in their integrated national energy and climate plans submitted pursuant to Articles 3 and 14 of Regulation (EU) 2018/1999.
4b. Member States shall ensure that operators of district heating or cooling systems above 25 MWth capacity are encouraged to connect third party suppliers of energy from renewable sources and from waste heat and cold or are encouraged to offer to connect and purchase heat or cold from renewable sources and from waste heat and cold from third-party suppliers on the basis of non-discriminatory criteria set by the competent authority of the Member State concerned, where such operators need to do one or more of the following: (a) meet demand from new customers; (b) replace existing heat or cold generation capacity; (c) expand existing heat or cold generation capacity.
5. Member States may allow an operator of a district heating or cooling system to refuse to connect and to purchase heat or cold from a third-party supplier in any of the following situations: (a) the system lacks the necessary capacity due to other supplies of heat or cold from renewable sources or of waste heat and cold; (b) the heat or cold from the third-party supplier does not meet the technical parameters necessary to connect and ensure the reliable and safe operation of the district heating and cooling system; (c) the operator can demonstrate that providing access would lead to an excessive heat or cold cost increase for final customers compared to the cost of using the main local heat or cold supply with which the renewable source or waste heat and cold would compete; (d) the operator’s system is an efficient district heating and cooling system. Member States shall ensure that, when an operator of a district heating or cooling system refuses to connect a supplier of heating or cooling pursuant to the first subparagraph, information on the reasons for the refusal, as well as the conditions to be met and measures to be taken in the system in order to enable the connection, is provided by that operator to the competent authority. Member States shall ensure that an appropriate process is in place to remedy unjustified refusals.
6. Member States shall put in place, where necessary, a coordination framework between district heating and cooling system operators and the potential sources of waste heat and cold in the industrial and tertiary sectors to facilitate the use of waste heat and cold. That coordination framework shall ensure dialogue as regards the use of waste heat and cold involving, in particular: (a) district heating and cooling system operators; (b) industrial and tertiary sector enterprises generating waste heat and cold that can be economically recovered via district heating and cooling systems, such as data centres, industrial plants, large commercial buildings, energy storage facilities, and public transport; (c) local authorities responsible for planning and approving energy infrastructures; (d) scientific experts working on the latest state of the art of district heating and cooling systems; and (e) renewable energy communities involved in heating and cooling.
7. The right to disconnect by terminating or modifying a contract in accordance with paragraph 2 may be exercised by individual customers, by joint undertakings formed by customers or by parties acting on behalf of customers. For multi-apartment blocks, such disconnection may be exercised only at a whole building level in accordance with the applicable housing law.
8. Member States shall establish a framework under which electricity distribution system operators will assess, at least every four years, in cooperation with the operators of district heating and cooling systems in their respective areas, the potential for district heating and cooling systems to provide balancing and other system services, including demand response and thermal storage of excess electricity from renewable sources, and whether the use of the identified potential would be more resource- and cost-efficient than alternative solutions. Member States shall ensure that electricity transmission and distribution system operators take due account of the results of the assessment required under the first subparagraph in grid planning, grid investment and infrastructure development in their respective territories. Member States shall facilitate coordination between operators of district heating and cooling systems and electricity transmission and distribution system operators to ensure that balancing, storage and other flexibility services, such as demand response, provided by district heating and district cooling system operators, can participate in their electricity markets. Member States may extend the assessment and coordination requirements under the first and third subparagraphs to gas transmission and distribution system operators, including hydrogen networks and other energy networks.
9. Member States shall ensure that the rights of consumers and the rules for operating district heating and cooling systems in accordance with this Article are clearly defined, publicly available and enforced by the competent authority.
10. A Member State shall not be required to apply paragraphs 2 to 9 where at least one of the following conditions is met: (a) its share of district heating and cooling was less than or equal to 2 % of the gross final consumption of energy in heating and cooling on 24 December 2018; (b) its share of district heating and cooling is increased above 2 % of the gross final consumption of energy in heating and cooling on 24 December 2018 by developing new efficient district heating and cooling on the basis of its integrated national energy and climate plan submitted pursuant to Articles 3 and 14 of, and in accordance with, Regulation (EU) 2018/1999 and the assessment referred to in Article 23(1b) of this Directive; (c) 90 % of the gross final consumption of energy in district heating and cooling systems takes place in efficient district heating and cooling systems. |
The right to disconnect
Article 24(2)(3) and (7) of the RED allows customers of district heating or cooling systems which are not efficient district heating and cooling systems, or which are not such a system by 31 December 2025 on the basis of a plan approved by the competent authority, to disconnect by terminating or modifying their contract in order to produce heating or cooling from renewable sources themselves.
Where the termination of a contract is linked to physical disconnection, such a termination may be made conditional on compensation for the costs directly incurred as a result of the physical disconnection and for the undepreciated portion of assets needed to provide heat and cold to that customer.
Member States may restrict the aforementioned right to disconnect by terminating or modifying a contract to customers who can demonstrate that the planned alternative supply solution for heating or cooling results in a significantly better energy performance. The energy-performance assessment of the alternative supply solution may be based on the energy performance certificate.
The above right to disconnect by terminating or modifying a contract may be exercised by individual customers, by joint undertakings formed by customers or by parties acting on behalf of customers. For multi-apartment blocks, such disconnection may be exercised only at a whole building level in accordance with the applicable housing law.
Regulatory chronicle
18 October 2023
14 July 2021
Documentation
Directive (EU) 2018/2001, as amended by Directive (EU) 2023/2413 of the European Parliament and of the Council of 18 October 2023 (RED III), Article 24(4b), Article 24(5)
Third party access to district heating systems - Challenges for the practical implementation, Veit Bürgera, Jan Steinbachb, Lukas Kranzlc, Andreas Müllerc
Links