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Balancing and Settlement Code (BSC) and Other Grid Code, and Possibly BSC (Due to Interaction with Framework Documents

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Balancing and Settlement Code (BSC) and Other Grid Code, and Possibly BSC (Due to Interaction with Framework Documents o Electricity European Network Codes An Overview for GB Industry Parties I National Grid Issue date: November 2014 INTRODUCTION EUROPEAN THIRD ENERGY PACKAGE This document has been put together The European Third Energy Package was adopted in July 2009, and has been law since by National Grid to assist industry March 2011. The Third Energy Package refers to a suite of legislation for both Electricity and parties in understanding the European Gas and is a key step forward in developing a more harmonised European energy Network Codes, the process for market. The Third Energy Package has three key outputs: enhancing sustainability and developing and implementing them and helping the European Union (EU) meet its decarbonisation obligations; ensuring security of the potential high-level impacts on supply in light of a changing generation mix; and creating a single European Market for industry parties. Electricity. The document has been prepared by For Electricity, the Third Energy Package comprises of two regulations and a directive: National Grid and is provided solely for Conditions for access to the network for cross-border exchanges in electricity information purposes. Nothing in this (Regulation (EU) 714/2009); document constitutes legal advice. Regulation establishing an Agency for the Cooperation of Energy Regulators (Regulation 713/2009); Any queries relating to this document Common rules for the internal market in electricity (Directive 2009/72/EC). should be directed to; As is common to all EU law, regulations apply directly to the member states, whereas [email protected] directives require transcription into national law. In particular, Directive 2009/72/EC was transcribed into GB Law via The Electricity and Gas (Internal Markets) Regulations 2011. CONTENT OVERVIEW OF THE EUROPEAN NETWORK CODES There are presently ten European Network Codes at various stages of the development process. These European Network Codes are deemed the priority European Network Codes Page 1: by the European Commission. The ten European Network Codes cover three areas: Overview of European Network Codes & the Third Package Grid Connection Codes: provide functional requirements for generators, demand and HVDC equipment wishing to connect to Transmission and Distribution Networks. Page 2: Markets Codes: central to delivering the single European Energy Market, deal with the ENC development process allocation of cross-border capacity and energy in the forwards, day-ahead and intra- day markets. The Balancing European Network Code delivers a framework to facilitate Page 3 and 4: the cross-border exchange of balancing and reserve products between system Further details on European Network operators. Codes System Operation Codes: designed to ensure a secure and harmonised approach to system operation across systems. Also to establish a framework for the sharing and Page 5: exchange of reserve products between member states. ENTSO-E, ACER and European Union Institutions In addition there is a European Regulation on submission and publication of data in electricity markets (Regulation (EU) 543/2013) known as the Transparency Regulation. Page 6: GB Application It is expected that further European Network Codes will need to be developed in the future, Future Changes to ENCs however no firm dates have been identified in either the ACER or ENTSO-E work schedules. Future European Network Codes are expected on Connection Procedures, and Page 7: Tariffs. Useful Web Links Grid Requirements for Demand Connection Page 8: Requirements for Demand Connection HVDC Generators Code HVDC Sources of Further Information Connection Generators Code CapacityCapacity Allocation Allocation and and ForwardForward Capacity Capacity Markets BalancingBalancing CongestionCongestion Management Management AllocationAllocation OperationalOperational LoadLoad Frequency Frequency System OperationalOperational EmergencyEmergency and and PlanningPlanning ControlControl and and Operation SecuritySecurity RestorationRestoration andand Scheduling Scheduling ReservesReserves Page 1 of 8 EUROPEAN NETWORK CODE DEVELOPMENT PROCESS The development process for the European Network Codes Comitology is outlined in Regulation 714/2009 and details a staged The European Union uses a standard process for determining process involving; European Law. It is part of the co-decision process whereby the European Commission three elements of the European legislature (European ACER (Agency for the Cooperation of Energy Regulators) Commission, Council of the European Union and European ENTSO-E (European Network of Transmission System Parliament) must agree. Operators for Electricity) Under the present arrangements for Comitology, the ‘pen’ rests The development process is outlined in Figure 1 below. with the European Commission. Note that under the Treaty of Lisbon, the Comitology process is expected to change, however, The key stages in the process are as follows: at present the European Network Codes are proceeding under Development of Framework Guidelines (FWGL). ACER is the older Comitology system. invited by the European Commission to prepare a set of high-level principles on particular topics. This is a 6 month The Comitology process for the European Network Codes is process. expected to have three key phases: Development of the European Network Code. ENTSO-E Preparation for Comitology. The European Network Code is invited to prepare a European Network Code on a is received from ACER/ENTSO-E and it is prepared for particular topic based on the Framework Guidelines. This is Comitology. This includes; informal discussions between a 12 month process and includes a 2 month public member states, legal drafting, consultations with other consultation period. departments in the Commission and translations into the Review of the European Network Code. ACER will review official languages of the European Union. the European Network Code for compliance with the Cross-Border Committee. This is the key decision making framework guidelines. They may ask ENTSO-E to make phase of Comitology. During this phase the member states some revisions. ACER will issue an opinion and (qualified) agree and ultimately vote upon the text of each European recommendation to the European Commission. The initial Network Code. Voting takes place in the ‘Committee on the review will take 3 months, however, the process for ENTSO- implementation of legislation on conditions of access to the E to make revisions is not time constrained. network for border exchanges in electricity’, on a ‘Qualified Comitology. Comitology, or ‘committee procedure’, is the Majority’ Basis. At this Committee, the UK representative is formal process by which European Law is agreed. It involves the government Department for Energy and Climate Change member states, the Council of the European Union and (DECC), and they lobby on behalf of UK. Once agreed by European Parliament. The Comitology process is explored in this Cross-Border Committee the text of the European further detail later. Network Code is essentially finalised. Publication. The European Network Codes are expected to Council of the European Union and European be published in the Official Journal of the European Union Parliament Approval. The Council of the European Union (OJEU). The European Network Codes are expected to take and European Parliament both need to approve the the form of a Regulation. European Network Code. Based on previous experience, National Application. Individual member states will need to this is a ratification process and it is not expected that any align their domestic requirements with the requirements of changes will be made to the European Network Code during the European Network Codes, based on the scope and this phase. timelines outlined in them. This will ensure that domestic requirements are consistent with the requirements of the European Network Codes. Florence Forum May 2014: Network Code or Guidelines. Following concerns from the European Commission’s Legal service with regards to CACM and the number of decisions delegated to TSOs and NRAs after entry in to force; it was determined that CACM would proceed as a guideline as opposed to a Network Code. Both network codes and guidelines have the same legal status and will become directly applicable EU regulations, the difference being the development and modification routes (as defined in Regulation (EU) 714/2009) EUROPEAN NETWORK CODE DEVELOPMENT PROCESS TIMELINE Figure 1: Commission starts For a view of where each development European Network Code process currently is within the Development Process 1 year? Timeline, please visit the JESG section of National Commission invites ENTSO ACER ACER Comitology Grid’s website to access the ENTSO develops reviews Network Code develops led by to develop Network Network becomes Law ‘European Code Development FWGL Commission Organogram’. This can be Network Code Code Code found in the following link; http://www2.nationalgrid.com/ Stakeholder Engagement WorkArea/DownloadAsset.asp GB to 18m to 3+yrs x?id=35341 demonstrate 6 months To fit work 1 year 3 months compliance programme Page 2 of 8 EUROPEAN NETWORK CODES: FURTHER DETAILS The following tables illustrate further information about the ten priority European Network Codes. In particular it details the scope, the timescales for application, the likely affected GB parties and the GB Code which is expected to contain the majority of the changes relating to each European Network Code. Please
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