European Commission Must Deliver Stable Framework for Investment

6 April 2009

European Commission Must Deliver Stable Framework for Investment

ENA has called on the European Commission to back its recognition of the distribution networks vital role in delivering the secure and sustainable energy future with a stable framework which enables the investment the networks need.

Responding to European Commission’s Green Paper on Energy Networks,David Smith, Chief Executive, said: “The Green Paper on Energy Networks is the first time the Commission has recognised that the electricity and gas distribution and transmission networks are crucial agents to deliver EU energy security and sustainability goals.

“Throughout Europe, networks require unprecedented levels of investment to pay for the extensive programmes of infrastructure and interconnection build and reinforcement to meet the 2020 targets, keep the lights on and the gas flowing.

“Now that the Commission has recognised the vital role of networks, it needs to ensure that it provides a clear and stable legal and regulatory framework. Without this, networks will find it difficult to secure the long term financing needed for these infrastructure projects."

At the end of last year the European Commission published its Strategic Energy Review package of policy proposals and communications to strengthen EU energy security. Key networks proposals were set out in the Energy Networks Green Paper. ENA has submitted a reponse to this consultation.

The expectation is now that the responses received will provide the impetus for the next tranche of EU energy legislation in the autumn. Culminating in an EU energy action plan for EU leaders to sign off at their Spring 2010 Summit.

David Smith added: “Taking on a more active role in terms of system operation and demand side management represents a huge technical and information challenge for our distribution members. ‘Climate proofing’ the networks and developing a ‘Smart Grid’ will require regulatory incentives that encourage and reward innovation. These technological grid developments will benefit the networks companies, but also other market players including suppliers, generators, and most especially consumers, who will receive more accurate and timely information on their energy consumption

“The newer forms of generation – renewables; microgeneration and CHP – will connect directly to the distribution networks. ENA calls for the new forms of EU financing to replace the existing financial instruments to extend the funding incentives to include distribution companies.”