What is the TYNDP and why is this Plan important?
Every other year, ENTSOG publishes a legally non-binding TYNDP, which looks forward over a ten-year horizon, including a European supply adequacy outlook. The periodically updated European network development plans are essential for identifying the need of possible infrastructure projects required for the completion and the operation of an integrated, competitive and transparent gas market and ensuring an adequate level of security of gas supply. The TYNDP shall build on and be consistent with the National Development Plans (NDPs).
The Projects of Common Interest (PCIs) are selected from the projects present in the most recent TYNDP via a separate process led by the European Commission. The TYNDP should provide essential and comprehensive information for the selection of PCIs, in particular complete, monetised and trustable CBA results, which could be used by the Regional Groups during the PCI selection process.
Why an ACER Opinion on the gas TYNDP?
ACER is the Agency of the European Union mandated to monitor the development and execution of the ENTSOG's Plan. Upon submission of the draft Plan, the Agency shall issue an opinion on it taking into account the objectives of non-discrimination, effective competition and the efficient and secure functioning of the internal markets in natural gas. The Agency's Opinion on ENTSOG's 2018 TYNDP is the 5th opinion of the Agency of this kind.
What are ACER's recommendations for improving future gas TYNDPs?
The Agency acknowledges that the release of the TYNDP is the result of a complex, time-consuming and resource intensive process, and that ENTSOG endeavoured to implement simultaneously improvements for elaborating the TYNDP 2018 in various areas. Still, the Agency's assessment reveals that it should be feasible to further improve the European planning of infrastructure in various areas. With this objective, the Agency formulates several recommendations.
The Agency urges ENTSOG to consider for the final version of the TYNDP 2018:
(1) Publishing a summary document indicating how the feedback from the public consultation and the Agency's Opinion will be taken into account in the final TYNDP 2018 and in future TYNDPs.
(2) Providing a list of the projects excluded from the TYNDP 2018 for failing to meet the Practical Implementation Document criteria, along with the underlying reasons.
(3) Completing the project-specific CBA assessments with the Economic Performance Indicators, other relevant information and more detailed indications on how the grouping of projects for the CBA was carried out.
(4) Providing full clarity and transparency on the ranges for gas prices used for building the supply curves under the new modelling approach.
(5) Providing consistent information on the number of projects included in the TYNDP 2017 and commissioned by the time of the adoption of the TYNDP 2018.
(6) The NRAs comments and remarks on the TYNDP 2018 projects.
Mid- and long-term recommendations (for the TYNDP 2020)
The Agency encourages ENTSOG to consider for future TYNDPs:
(1) Developing common, consistent and balanced scenarios with the electricity TYNDP developed by ENTSO-E in line with previous recommendations of the Agency.
(2) Better incorporating the market perspective on infrastructure gaps, and the degree to which the projects included in the TYNDP could serve to close such gaps.
(3) Improving the CBA 2.0 methodology and its application regarding the monetisation of benefits, the provision of Economic Performance Indicators in the CBA results, and other long-terms improvements already outlined by the Agency.
(4) Further improving the model and modelling used by improving the indicators signalling market integration needs, incorporating best available information on long-term contracts, gradually implementing the interlinked electricity and gas model, fully documenting the TYNDP model with a detailed description, and continue improving the treatment of LNG.
(5) Plan better future TYNDP processes to avoid details and better align the electricity and gas TYNDP processes, as well as to better synchronise the TYNDP and the PCI selection processes.
(6) Further improving consultation processes by making sure all the information of the TYNDP, including the PS-CBAs, is made available to stakeholders to collect their feedback.
(7) Requiring PS-CBA project assessments and the same level of cost transparency for all TYNDP projects, irrespective of their intention to participate in the PCI selection process.
(8) Providing more quantitative and evidence-based information on the volumes, location, and economics of each of the renewable gas technologies in view of having more credible estimates of their use in the future.
(9) Considering developing a measurable indicator on how projects will contribute to the sustainability criterion apart from the estimation of the reduction of CO2 emissions.
(10) Considering better the implications and the necessary adaptations of the gas infrastructure to inject renewable and de-carbonised gases and the costs associated with such adaptations.
(11) Analysing the level of utilisation and contractual and physical congestion of existing entry and cross-border infrastructure, as one essential parameter to be taken into account when analysing the need of additional gas infrastructure, in order to minimise the risk of stranded or inefficient investments.
(12) Completing the task of identifying infrastructure gaps, especially with respect to target cross-border capacity needs, by developing and consulting proposals for the quantification of the target cross-border capacities, in line with on-going work on the electricity TYNDP.
(13) Considering developing metrics in order to provide early warnings for clearly unrealistic project timelines or conceptually doubtful projects.
(14) Making obligatory to promoters the provision of information related to the incremental capacity process, in order to include in the TYNDP a complete list of projects triggered purely on market basis by the incremental capacity process.
(15) Reconsidering the eligibility guidelines provided in ENTSOG's Practical Implementation Document ('PID'), in order to increase its effectiveness in filtering out unrealistic projects and projects of limited cross border relevance from future TYNDPs.
Other considerations related to infrastructure planning
Gas Regional Investment Plans (GRIPs). For future GRIPs, the Agency recommends ENTSOG and TSOs to up-front reach out to stakeholders in TYNDP workshops on the issues relevant to stakeholders for each of the GRIPs.
Update of infrastructure categories in the TEN-E Regulation. The gas infrastructure categories defined in Annex II (2) of Regulation (EU) No 347/2013 should be revisited in view of considering the impact of renewable (“green") gases, in the context of the recent ambitious climate and energy targets deriving from the Paris Agreement, as well as in the context of electricity and gas sector coupling.
Access the Opinion here.