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ACER Opinion on the ENTSO-E guideline for cost-benefit analysis of grid development projects

​​​ACER published its Opinion on the ENTSO-E guideline for cost-benefit analysis (CBA) of grid development projects. ACER welcomed the improvements in the CBA methodology published by ENTSO-E, which:      
  • avoids double counting of economic effects;
  • expresses the costs and some benefits in monetary terms;
  • introduces new clustering rules favouring a more consistent approach to group complementary investments for a specific project;
  • requires to construct and analyse contrasting future development scenarios;
  • identifies six parameters (demand, fuel cost, renewable energy sources, CO2 price, discount rate, commissioning date) for developing sensitivity analyses.
Nevertheless, ACER also considered necessary that ENTSO-E adapts its CBA guideline according to nine specific recommendations before submitting it to the European Commission. Furthermore, ACER recommended ENTSO-E to develop a separate CBA guideline to identify specific benefits of electricity storage before the selection of projects of common interest taking place in 2015.     
ACER also stated its expectations for the Ten Year Network Development Plan (TYNDP) 2014 and for future CBA updates and improvements. According to ACER, ENTSO-E should evaluate the application of this CBA guideline in the TYNDP 2014, in particular, assessing the new clustering rules and the new approach for scenarios development. Additionally, ENTSO-E should further monetise benefits, in particular the reduction of future costs for ancillary services and/or generation investments being avoided or deferred.