European Network of Transmission System Operators for Electricity (ENTSO-E) is the association representing European Transmission System Operators (TSOs) and has been formally established under Regulation 714/2009, which defined its role and legal mandate.
Additional roles and responsibilities of ENTSO-E were contained in Regulations 838/2010, 543/2013 and 347/2013.
ENTSO-E works closely with the European Commission (EC) and the Agency for the Cooperation of Energy Regulators (ACER) and consults with all the stakeholders when carrying out its duties.
Special role is attached to the ENTSO-E by the Winter Energy Package. Regulation (EU) 2019/943 of the European Parliament and of the Council of 5 June 2019 on the internal market for electricity (recast) in Recital 42 explains that the ENTSO for Electricity is established in order to “ensure optimal management of the electricity transmission network and to allow trading and supplying electricity across borders in the Union“.
ENTSO-E mission and functions
ENTSO-E's mission is to fulfil its various legal mandates for the benefit of electricity customers, and to leverage its mandated work products to shape future energy policy for the benefit of society at large in the face of significant challenges in the areas of:
- security of supply in maintaining a high level of operational security and promoting the adequate development of the interconnected European grid and investments for a reliable, efficient and sustainable power system.
- markets, by proposing and implementing market integration and transparency frameworks that facilitate competitive and integrated continental wholesale and retail markets.
- sustainability, by facilitating secure integration of renewable generation sources and other energy mix changes (see ENTSO-E draft Work Programme 2015 through December 2016, p. 4).
As the above Work Programme further elaborates (p. 5), the TSOs' neutral and unbundled role in the electricity market "is the basis not only for the legal mandate but also for policy suggestions. Being a non-profit association of its member TSOs, ENTSO-E's policy suggestions build on the public-service orientation of its members, where regulation is designed to align the TSOs' interests with those of consumers and society at large. ENTSO-E is engaged to explain transparently how society's interests are advanced through its work products, especially in the rare cases of doubts about interest alignment."
The central purpose of the ENTSOs is to facilitate the cooperation of TSOs in promoting the completion and the well-functioning of the EU Internal Electricity Market (IEM) and cross-border trade, as well as to ensure optimal management, coordinated operation and sound technical evolution of the electricity and gas transmission networks (Article 4 of Regulation (EC) No 714/2009, Article 4 of Regulation (EC) No 715/2009).
Pursuant to Article 4(1) of ENTSO-E's articles of association, "the Association shall, on a non-profit-making basis, pursue the co-operation of the European TSOs both on the pan-European and regional level. It promotes the TSOs' interests and has an active and important role in the European rule setting process in compliance with EU legislation. Its objective is to promote the reliable operation, optimal management and sound technical evolution of the European electricity transmission system in order to ensure security of supply and to meet the needs of the IEM."
Joint ACER-CEER response to European Commission's Consultation on a new Energy Market Design of 7 October 2015 (p. 26), however, argues the current legal framework does not establish for ENTSOE-E sufficient general safeguards, notably against conflicts of interests, i.e. between the interest of the Union and individual TSOs' interests, against inefficient decision-making and against the failure to deliver.
The above ACER/CEER document of 7 October 2015 underlines, in fact, "there is no clear requirement for the ENTSOs to act in the interest of the Union, prevailing over any individual TSOs' interests, no clear definition of general decision-making rules and no generally applicable sanctions for the ENTSOs' failure to deliver."
Proposal for a Regulation of the European Parliament and of the Council on the internal market for electricity (recast) of 30 November 2016 (COM(2016) 861 final 2016/0379 (COD)) in Articles 25 - 31 proposed to redefine the role and functions of the ENTSO-E.
In particular, the mission of the ENTSO-E has been reformulated in the following way:
"In performing its functions under EU law, the ENTSO for Electricity shall act for the European good and independent from individual national interests or the national interests of transmission system operators, and shall contribute to the efficient and sustainable achievement of the objectives set out in the policy framework for climate and energy covering the period from 2020 to 2030, in particular by contributing to the efficient integration of electricity generated from renewable energy sources and to increases in energy efficiency."
Under the 'Winter Energy Package' ENTSO for Electricity has also the responsibility to prepare and to adopt proposals related to the European resource adequacy assessment and for the technical specifications for cross-border participation in capacity mechanisms.
Pursuant to the above legislative proposition ENTSO for Electricity is assigned, among others, the following tasks with respect to regional operational centres:
- adoption of a framework for the cooperation and coordination between regional operational centres,
- adoption a proposal defining the system operation region covered by each regional operational centre.
Governance structure of the ENTSO-E
The governance of ENTSO-E envisages the three different kinds of participation:
- associate members,
Members have the right to attend and vote in all bodies (General Assembly, committees, groups).
In ENTSO-E, both EU and non-EU TSOs can become members.
TSOs from 36 countries are members of ENTSO-E - apart from the EU’s TSOs, the TSOs from Albania, Bosnia and Herzegovina, Iceland, Switzerland, Montenegro, FYR of Macedonia, Norway and Serbia.
However, a non-EU TSO can be member only if its country has entered into an agreement with the EU governing its relationship with the EU Internal Electricity Market.
Associate members can attend all bodies, but do not have a right to vote.
To become the ENTSO-E associate member the candidate TSO is required to show its concrete intention to comply with the relevant technical and market rules of the EU Internal Electricity Market.
Observers have limited rights in the ENTSO-E’s governance structures.
ENTSO-E observers are not granted any voting rights, moreover, the attendance rights are limited (an observer cannot attend any meeting by default but it may be provided with information and publications of working groups to which it was invited to name a representative).
Regulation (EU) 2019/943 of the European Parliament and of the Council of 5 June 2019 on the internal market for electricity (recast), Recital 42, Articles 28 - 33, Article 41(2)
In order to ensure optimal management of the electricity transmission network and to allow trading and supplying electricity across borders in the Union, the ENTSO for Electricity, should be established. The tasks of the ENTSO for Electricity should be carried out in accordance with Union's competition rules which remain applicable to the decisions of the ENTSO for Electricity. The tasks of the ENTSO for Electricity should be well-defined and its working method should ensure efficiency and transparency.
European network of transmission system operators for electricity
1. Transmission system operators shall cooperate at Union level through the ENTSO for Electricity, in order to promote the completion and functioning of the internal market for electricity and cross-zonal trade and to ensure the optimal management, coordinated operation and sound technical evolution of the European electricity transmission network.
2. In performing its functions under Union law, the ENTSO for Electricity shall act with a view to establishing a well-functioning and integrated internal market for electricity and shall contribute to the efficient and sustainable achievement of the objectives set out in the policy framework for climate and energy covering the period from 2020 to 2030, in particular by contributing to the efficient integration of electricity generated from renewable energy sources and to increases in energy efficiency while maintaining system security. The ENTSO for Electricity shall be equipped with adequate human and financial resources to carry out its duties.
The ENTSO for Electricity
1. The transmission system operators for electricity shall submit to the Commission and to ACER any draft amendments to the statutes, list of members or rules of procedure of the ENTSO for Electricity.
2. Within two months of receipt of the draft amendments to the statutes, list of members or rules of procedure, ACER, after consulting the organisations representing all stakeholders, in particular the system users, including customers, shall provide an opinion to the Commission on these draft amendments to the statutes, list of members or rules of procedure.
3. The Commission shall deliver an opinion on the draft amendments to the statutes, list of members or rules of procedures taking into account ACER's opinion as provided for in paragraph 2 and within three months of receipt of ACER's opinion.
4. Within three months of receipt of the Commission's favourable opinion, the transmission system operators shall adopt and publish the amended statutes or rules of procedure.
5. The documents referred to in paragraph 1 shall be submitted to the Commission and to ACER where there are changes thereto or upon the reasoned request of either of them. The Commission and ACER shall deliver an opinion in accordance with paragraphs 2, 3 and 4.
Tasks of the ENTSO for Electricity
1. The ENTSO for Electricity shall:
(a) develop network codes in the areas set out in Article 59(1) and (2) with a view to achieving the objectives set out in Article 28;
(b) adopt and publish a non-binding Union-wide ten-year network development plan, (‘Union-wide network development plan’), biennially;
(c) prepare and adopt proposals related to the European resource adequacy assessment pursuant to Article 23 and proposals for the technical specifications for cross-border participation in capacity mechanisms pursuant to Article 26(11);
(d) adopt recommendations relating to the coordination of technical cooperation between Union and third-country transmission system operators;
(e) adopt a framework for the cooperation and coordination between regional coordination centres;
(f) adopt a proposal defining the system operation region in accordance with Article 36;
(g) cooperate with distribution system operators and the EU DSO entity;
(h)promote the digitalisation of transmission networks including deployment of smart grids, efficient real time data acquisition and intelligent metering systems;
(i) adopt common network operation tools to ensure coordination of network operation in normal and emergency conditions, including a common incident classification scale, and research plans, including the deployment of those plans through an efficient research programme. Those tools shall specify inter alia:
(i) the information, including appropriate day-ahead, intraday and real-time information, useful for improving operational coordination, as well as the optimal frequency for the collection and sharing of such information;
(ii) the technological platform for the exchange of information in real time and where appropriate, the technological platforms for the collection, processing and transmission of the other information referred to in point (i), as well as for the implementation of the procedures capable of increasing operational coordination between transmission system operators with a view to such coordination becoming Union-wide;
(iii) how transmission system operators make available the operational information to other transmission system operators or any entity duly mandated to support them to achieve operational coordination, and to ACER; and
(iv) that transmission system operators designate a contact point in charge of answering inquiries from other transmission system operators or from any entity duly mandated as referred to in point (iii), or from ACER concerning such information;
(j) adopt an annual work programme;
(k) contribute to the establishment of interoperability requirements and non-discriminatory and transparent procedures for accessing data as provided for in Article 24 of Directive (EU) 2019/944;
(l) adopt an annual report;
(m) carry out and adopt seasonal adequacy assessments pursuant to Article 9(2) of Regulation (EU) 2019/941;
(n) promote cyber security and data protection in cooperation with relevant authorities and regulated entities;
(o) take into account the development of demand response in fulfilling its tasks.
2. The ENTSO for Electricity shall report to ACER on shortcomings identified regarding the establishment and performance of regional coordination centres.
3. The ENTSO for Electricity shall publish the minutes of its assembly meetings, board meetings and committee meetings and provide the public with regular information on its decision-making and activities.
4. The annual work programme referred to in point (j) of paragraph 1 shall contain a list and description of the network codes to be prepared, a plan on coordination of operation of the network, and research and development activities, to be realised in that year, and an indicative calendar.
5. The ENTSO for Electricity shall provide ACER with the information that ACER requires to fulfil its tasks pursuant to Article 32(1). In order to enable the ENTSO for Electricity to meet that requirement, transmission system operators shall provide the ENTSO for Electricity with the requisite information.
6. Upon request of the Commission, the ENTSO for Electricity shall give its views to the Commission on the adoption of the guidelines as laid down in Article 61.
1. While preparing the proposals pursuant to the tasks referred to in Article 30(1), the ENTSO for Electricity shall conduct an extensive consultation process. The consultation process shall be structured in a way to enable the accommodation of stakeholder comments before the final adoption of the proposal and in an open and transparent manner, involving all relevant stakeholders, and, in particular, the organisations representing such stakeholders, in accordance with the rules of procedure referred to in Article 29. That consultation shall also involve regulatory authorities and other national authorities, supply and generation undertakings, system users including customers, distribution system operators, including relevant industry associations, technical bodies and stakeholder platforms. It shall aim at identifying the views and proposals of all relevant parties during the decision-making process.
2. All documents and minutes of meetings related to the consultations referred to in paragraph 1 shall be made public.
3. Before adopting the proposals referred to in Article 30(1) the ENTSO for Electricity shall indicate how the observations received during the consultation have been taken into consideration. It shall provide reasons where observations have not been taken into account.
Monitoring by ACER
1. ACER shall monitor the execution of the tasks of the ENTSO for Electricity referred to in Article 30(1), (2) and (3) and report its findings to the Commission.
ACER shall monitor the implementation by the ENTSO for Electricity of network codes developed under Article 59. Where the ENTSO for Electricity has failed to implement such network codes, ACER shall request the ENTSO for Electricity to provide a duly reasoned explanation as to why it has failed to do so. ACER shall inform the Commission of that explanation and provide its opinion thereon.
ACER shall monitor and analyse the implementation of the network codes and the guidelines adopted by the Commission as laid down in Article 58(1), and their effect on the harmonisation of applicable rules aimed at facilitating market integration as well as on non-discrimination, effective competition and the efficient functioning of the market, and report to the Commission.
2. The ENTSO for Electricity shall submit the draft Union-wide network development plan, the draft annual work programme, including the information regarding the consultation process, and the other documents referred to in Article 30(1) to ACER for its opinion.
Where it considers that the draft annual work programme or the draft Union-wide network development plan submitted by the ENTSO for Electricity does not contribute to non-discrimination, effective competition, the efficient functioning of the market or a sufficient level of cross-border interconnection open to third-party access, ACER shall provide a duly reasoned opinion as well as recommendations to the ENTSO for Electricity and to the Commission within two months of the submission.
The costs related to the activities of the ENTSO for Electricity referred to in Articles 28 to 32 and 58 to 61 of this Regulation, and in Article 11 of Regulation (EU) No 347/2013 of the European Parliament and of the Council (22) shall be borne by the transmission system operators and shall be taken into account in the calculation of tariffs. Regulatory authorities shall approve those costs only if they are reasonable and appropriate.
The ENTSO for Electricity and regional coordination centres shall operate in full transparency towards stakeholders and the general public. They shall publish all relevant documentation on their respective websites.
Regulation (EU) 2019/943 of the European Parliament and of the Council of 5 June 2019 on the internal market for electricity (recast), Recital 42, Articles 28 - 33, Article 41(2)
Proposal for a Regulation of the European Parliament and of the Council on the internal market for electricity (recast), 30.11.2016, COM(2016) 861 final 2016/0379 (COD), Articles 25 - 31
ENTSO-E draft Work Programme 2015 through December 2016, p. 4
Joint ACER-CEER response to European Commission's Consultation on a new Energy Market Design of 7 October 2015, p. 26