Gas Regional Initiative – North West Region Investment workshop The Hague – 4 June 2010 Investment Project Regional Investment Plans Introduction to methodology Benoît Esnault, CRE Investment project vice-chair

2 Investment workshop The Hague – 4 June, 2010 Why involving GRI NW in regional investment plans?  The 3rd package will enter into force on March 3, 2011  Regional investment plans will have to be developed starting next year  The North West region is the core part of the EU gas market  Regional plans are part of other GRIs work programme  Still many open questions Content of the regional plans Who will be responsible for what? Size of the regions

3 Investment workshop The Hague – 4 June, 2010 Agenda for discussion on the scope of regional investment plans  Project based on GRI NW experience with investment  Proposed scope for the GRI NW project Scope and objectives of the plans Contents Drafting methodology  Possible informal views out of direct scope on roles, timing, etc.  Discussion paper prepared for the workshop Legal background Elements from ERGEG recommendations on TYNDP Questions and challenges

4 Investment workshop The Hague – 4 June, 2010 Legal background  Regional investment plans TSOs shall establish a regional cooperation within ENTSOG (Article 12, Regulation n°715/2009) TSOs shall publish a regional investment plan every two years, and may take investment decisions based on that regional plan (Article 12, Regulation n°715/2009) The Community wide TYNDP shall build on national investment plans, taking into account regional investment plans (Article 8 – Regulation n°715/2009) The Agency shall monitor the regional cooperation of TSOs referred to in Article 12 of Regulation (EC) No 715/2009, and take due account of the outcome of that cooperation when formulating its opinions, recommendations and decisions.

5 Investment workshop The Hague – 4 June, 2010 Questions and challenges  On scope and responsibilities Perimeter of regions? Breakdown of roles between ENTSOG and its members, between NRAs, RCC and ACER  On the content and methodology Level of details on project description To what extent should gas system’s behaviour be investigated? Regional simulations of supply crises? Develop on the provisions of the security of supply regulation (infrastructure standards for instance)

6 Investment workshop The Hague – 4 June, 2010 Possible approaches  Elements from ERGEG recommendations on the Community-wide TYNDP Combination of top-down and bottom-up Network modeling including crisis simulations Selection of demand and supply scenarios Dialogue with stakeholders  Regional plans could be either An extract from Community-wide plans including modelling and security of supply simulations Or an extension of national plans focusing on cross-border TSO cooperation and integration of national markets

7 Investment workshop The Hague – 4 June, 2010 Potential value added of regional plans  The identification of infrastructure and investment gaps;  Description and understanding of cross border congestions;  Better address the relation between infrastructure and market integration in order to have an accurate diagnosis about investment needs;  Ensure a consistent design for cross-border projects.

8 Investment workshop The Hague – 4 June, 2010 Role of the NW region and next steps  Get stakeholders’ views on Excpectations from market players Potential difficulties  Bring proposals to the EU level without duplication of work ERGEG and ENTSOG work on regional plans Communicate with the Commission Build upon the region’s specific experience regarding market integration  Next steps Discussion paper including concrete proposals by September