Guidelines for Trans-European Energy Infrastructure

Introduction

The Regulation (EU) 2022/869 on guidelines for trans-European energy infrastructure (TEN-E) establishes a new framework for the identification and development of cross-border energy projects. It is a cornerstone of the European Green Deal, designed to modernize the EU's energy infrastructure to meet its ambitious 2030 climate and energy targets and achieve climate neutrality by 2050.

This regulation repeals and replaces the previous TEN-E Regulation (EU) No 347/2013, shifting the focus away from fossil fuel infrastructure (with specific, time-limited exceptions) towards projects that support decarbonization. It introduces new infrastructure categories, such as hydrogen networks, electrolysers, smart gas grids, and carbon dioxide transport and storage, while strengthening the framework for electricity grids, particularly offshore renewable energy networks.

Main Goal

The primary goal of the TEN-E Regulation is to facilitate the timely development and interoperability of Projects of Common Interest (PCIs) and Projects of Mutual Interest (PMIs) with third countries. These projects are essential for creating a more integrated, resilient, and decarbonized European energy market. Key objectives include:

• Ensuring climate change mitigation by aligning infrastructure development with the EU's 2050 climate neutrality objective.
• Integrating renewable energy sources, especially from offshore wind farms, into the grid.
• Enhancing energy security by diversifying sources and routes.
• Promoting market and system integration across Member States.
• Supporting competition and ensuring the affordability of energy prices for consumers.

Who It Applies To

The regulation primarily applies to:

• Project Promoters: This includes Transmission System Operators (TSOs), Distribution System Operators (DSOs), and other operators or investors developing a PCI or PMI.
• Member States: They are responsible for designating national competent authorities, streamlining permit processes, and cooperating on cross-border projects.
• National Competent Authorities: These bodies are responsible for facilitating and coordinating the permit-granting process for PCIs.
• National Regulatory Authorities (NRAs): They are involved in decisions on cost allocation and regulatory incentives.
• The EU Agency for the Cooperation of Energy Regulators (ACER): ACER plays a key role in monitoring progress, providing opinions, and taking decisions on cross-border cost allocation if NRAs cannot agree.
• European Network of Transmission System Operators (ENTSOs) for Electricity, Gas, and Hydrogen: They are tasked with developing network development plans, cost-benefit analysis methodologies, and identifying infrastructure gaps.

Key Dates

The regulation sets out a series of deadlines for various actors:

• 23 June 2022: The regulation entered into force and became directly applicable.
• 30 November 2023: Deadline for the Commission to adopt the first Union list of PCIs and PMIs under the new regulation.
• 24 January 2024: Deadline for ENTSO for Electricity to develop the first high-level strategic integrated offshore network development plans.
• 31 December 2027: Eligibility for EU financial assistance ends for certain derogated gas projects (Cyprus/Malta) and for transitional hydrogen projects that blend hydrogen with natural gas.
• 31 December 2029: The derogation for gas interconnections for Cyprus and Malta expires. The transitional period for using repurposed natural gas assets for hydrogen-gas blends also ends.

Exemptions

The regulation largely excludes support for new natural gas infrastructure. However, it provides a temporary and conditional derogation under Article 24 for:

• Cyprus and Malta: One gas interconnection project for each of these Member States, which are not yet connected to the trans-European gas network, can maintain its PCI status until 31 December 2029, or until they are connected, whichever is earlier. This is conditional on the projects being designed to be adaptable for hydrogen in the future.

Key Provisions

• Union List of PCIs and PMIs: A list of key cross-border infrastructure projects is established every two years. Projects on this list benefit from accelerated permitting and are eligible for EU funding.
• New Infrastructure Categories: The scope is expanded to include hydrogen infrastructure (pipelines, storage, electrolysers), smart gas grids, offshore renewable energy grids, and CO2 networks.
• Accelerated Permit Granting: PCIs are granted priority status at the national level. The regulation sets a binding maximum timeline of 42 months for the entire permit-granting process, managed by a single national competent authority to create a one-stop-shop.
• Cross-Border Cost Allocation: A mechanism allows the costs of a project to be allocated among the Member States that benefit from it, decided by the relevant National Regulatory Authorities or, in case of disagreement, by ACER.
• Regulatory Incentives: NRAs can grant incentives to projects facing higher-than-normal risks.
• Offshore Grid Planning: A new framework for regional cooperation on planning integrated offshore grids in different sea basins (e.g., North Sea, Baltic Sea).
• Sustainability Assessment: All candidate projects must undergo a mandatory sustainability assessment and demonstrate that their potential benefits outweigh their costs.

Obligations & Requirements

• Project Promoters: Must submit detailed project proposals, conduct a cost-benefit analysis, create an implementation plan, report annually on progress, and engage in public participation.
• Member States: Must designate a national competent authority, streamline national permit-granting procedures to meet the regulation's timelines, and cooperate on regional offshore grid planning.
• ENTSOs: Must develop harmonized energy system-wide cost-benefit analysis methodologies, create joint scenarios for network development plans that are aligned with EU climate goals, and identify infrastructure gaps.

Affected Products/Types/Actors/Processes

• Actors: TSOs, DSOs, energy project developers, investors, national governments, and regulatory bodies.
• Processes: The planning, permitting, financing, and construction of large-scale energy infrastructure.
• Infrastructure Types:
  • High-voltage electricity transmission lines (onshore and offshore).
  • Electricity storage facilities.
  • Smart electricity grids.
  • Hydrogen pipelines, storage facilities, and large-scale electrolysers (min. 50 MW).
  • Smart gas grids for integrating renewable and low-carbon gases.
  • Pipelines and facilities for the transport and geological storage of CO2.

Penalties

The regulation does not specify financial penalties for non-compliance in the traditional sense. Instead, it includes mechanisms to ensure project implementation. If a PCI is significantly delayed for reasons within the promoter's control (Article 5(7)), a series of measures can be triggered:

• National regulatory authorities can ensure the investment is carried out.
• The project promoter may be required to accept a third party to finance or construct the project.
• The Commission may launch a call for proposals for a third party to build the project.

A project can also be removed from the Union list if its inclusion was based on incorrect information or if it fails to comply with EU law, thereby losing all associated rights and benefits like accelerated permitting and eligibility for funding.