European grid operators seek EU approval to cross-border scheme

17 September 2002 – The umbrella group representing Europe’s electricity transmission grid operators is to present a new system of harmonised cross-border transmission fees to the European Commission today.

“We have agreed on the principles of the mechanism,” said Ana Aguado, secretary general of the European Transmission System Operators (ETSO).

Details of the proposed system, designed to replace a transitory scheme in place since March, would be presented with a view to implementing the new system next year, she added. The commission and regulators would have to approve the system before it is launched.

The European Commission backed ETSO’s temporary scheme on the understanding that grids would devise a better long-term solution.

Transmission System Operators (TSOs) are responsible for the bulk transmission of electric power on the main high voltage electric networks. TSOs provide grid access to the electricity market players (i.e. generating companies, traders, suppliers, distributors and directly connected customers) according to non-discriminatory and transparent rules. Only about eight per cent of Europe’s power is currently traded across national borders.

Harmonisation of fees paid to grids for transmitting power across Europe is seen as crucial to promoting trade throughout continent’s liberalising energy market.

Aguado said the proposals for the new system were based largely on transit fees to compensate the grids that transmit power through intermediate countries as it flows to its final destination.

But a decision on whether or not to include an export fee, as in the current system, had yet to be decided, she said. “We want to wait to see what the regulators’ view on this is,” she said.

Aguado said the system could be tweaked again in 2004, when all European grids have agreed to start reporting hourly data, giving a more accurate picture of transmission flows.

The networks represented by ETSO supply more than 400 million people with electric energy. The consumption of electric energy amounts to around 3000 TWh per year.

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