Changes from plenary report to adopted text

Removed(f) create a reliable timeframe and investment-friendly environment for private and public actors to meet a specific area’s heating and cooling needs, including the decommissioning and repurposing of assets, based on that strategy referred to in point (g);

Removed(g) include a trajectory to achieve the goals of the plans in line with climate neutrality and the monitoring of the progress of implementation of policies and measures identified;

Removed(h) be prepared with the involvement of all relevant infrastructure operators on distribution level, of at least gas, including hydrogen, electricity and district heating, as well as all relevant regional or local stakeholders and ensure the participation of the public.

Removed3. Member States shall ensure that all relevant parties, including public and relevant private stakeholders, are given the opportunity to participate in the preparation of local heating and cooling plans, the policies and measures. Member States shall ensure that final customers are fully informed about mandatory fuel switches and alternatives in accordance with Article 11a.

RemovedFor that purpose, Member States shall develop recommendations supporting the regional and local authorities to implement policies and measures in renewable energy based heating and cooling at regional and local levels using the potential identified. Member States shall support regional and local authorities to the utmost extent possible by any means including financial support and technical support schemes.

Removed4. Local heating and cooling plans may be implemented jointly by a group of several neighbouring local authorities provided that the geographical and administrative context as well as the heating and cooling infrastructure is appropriate.

Removed5. The implementation of local heating and cooling plans shall be verified and assessed by a competent authority. Where implementation is considered to be insufficient, on the basis of the trajectory and the monitoring pursuant to paragraph 2, point (g), the competent authority shall propose measures to close the implementation gap.

Removed1. All distribution system operators or hydrogen distribution network operators shall submit a distribution network development plan to the regulatory authority for approval at least every four years in due time for being considered in the drafting of the ten-year network development plans referred to in Article 51. The distribution network development plan shall set out the planned investments for the next five-to-ten years, including main distribution infrastructure which is required to transport renewable gas from new production facilities, as well as the infrastructure which will be decommissioned and repurposed. Distribution system operators and hydrogen distribution network operators that are active in the same regional area may opt to develop one single joint network development plan. Distribution network development plans shall:

Removed(a) be aligned with the Member State’s integrated national energy and climate plan, national energy and climate report and long-term strategy submitted under Regulation (EU) 2018/1999, and contribute to the achievement of regional and national climate and energy targets for 2030 and 2050;

Removed(b) be based on relevant strategies referred to in Article 52a(2), point (c) that establish requirements for the infrastructure on distribution level, including parts that may require decommissioning, aiming to reduce the use of gas in buildings in case more energy and cost-efficient sustainable technologies are available;

Removed(c) be based on reasonable assumptions about the evolution of production, injection, supply and consumption of gas while taking into account the relevant strategies of the local authorities for the heating and cooling of new residential areas as well as requests from final customers to switch fuels;

Removed(d) be consistent with the ten-year network development plan referred to in Article 51;

Removed(e) promote priority use of renewable gas and low-carbon gas in hard-to-decarbonise sectors where no other more energy and cost efficient options are available;

Removed(f) contain all investments, including demand-side solutions not requiring new infrastructure investments, energy storage facilities or other available energy system resources as an alternative to system expansion where doing so is more efficient as well as grid reinforcement for the injection of biomethane; and

Removed(g) include information on infrastructure that could be decommissioned, where alternatives are available, or repurposed for the transport of hydrogen, including to rapidly deliver hydrogen to end-users in hard-to-decarbonise sectors, which have the highest greenhouse gas emissions abatement potential per tonne of consumed hydrogen and where no other more energy and cost efficient options are available.

Removed2. The distribution system operator or the hydrogen distribution network operator shall conduct a public consultation on the draft distribution network development plan. The participation is voluntary and all relevant stakeholders shall be invited, including the transmission system operator and hydrogen transmission system operator, as well as district heating infrastructure and electricity operators, associations involved in electricity, gas and hydrogen markets, heating and cooling, supply and production undertakings, independent aggregators, demand-response operators, organisations involved in energy efficiency solutions, industrial end-users, energy consumer associations, civil society representatives, research organisations and universities, where appropriate. To ensure early and effective participation, the distribution system operator or the hydrogen distribution network operator shall publish a draft of the network development plan in advance for comments.

Removed3. The distribution system operator or the hydrogen distribution network operator shall make public the results of the consultation processes together with the draft distribution network development plan.

Removed4. The regulatory authority shall approve or reject the distribution network plan and may require amendments to the plan, based on its consistency or inconsistency with the requirements of paragraph 1, before making a decision to approve or reject the plan.

Removed5. However, Member States may decide not to apply the obligations set out in paragraphs 1 to 4 to distribution system operator which serve less than 35 000 connected customers by ... [the date of entry into force of this Directive].

Removed6. Where the strategy referred to in Article 52a(2), point (e), or the distribution network development plan developed under this Article identifies that parts of the distribution system may require decommissioning, in particular before the end of their originally projected useful lifecycle, and will not be repurposed for the transport of hydrogen, Member States shall ensure regulatory guidance from the regulatory authorities and financial support for distribution system operators. Support measures shall take into account security of supply, the affordability of network tariffs and environmental requirements. Complementary, the distribution system operator shall propose interventions to the regulatory authority to equitably allocate the efficient costs of the assets over their remaining lifecycle until they are decommissioned. To that end, the regulatory authority may in coordination with the distribution system operator set up guidelines for a structural approach to the depreciation of assets. Such interventions could include, for example, adjusting the depreciation profile or timeline of the assets. The regulatory authority in coordination with the distribution system operator shall decide whether such assets should be decommissioned before the end of their originally projected useful lifecycle and, if so, whether any of the interventions proposed by the distribution system operator, or any alternative interventions, shall be implemented to equitably allocate the efficient costs of the assets over their remaining lifecycle until decommissioning. The repurposing of assets for the transport of hydrogen in accordance with paragraph 2, point (g), shall be taken into account. The distribution system operator shall implement the interventions decided by the regulatory authority.

Removed-1. Without prejudice to Article 4 of Regulation [recast Gas Regulation as proposed in COM(2021)xxx], there shall be no cross-subsidisation between current gas grid users and the users of the future hydrogen network.

Removed1. Where Member States apply a system of regulated third party access to hydrogen networks pursuant to Article 31, paragraph 1 and where a hydrogen interconnector project is included in the EU-wide ten-year network development plan as referred to in Article 29 ▌of [recast Gas Regulation as proposed in COM(2021)xxx] and is not a project of common interest as referred to in [Chapter II and Annex I point 3 of Regulation xxx on Guidelines for trans-European energy infrastructure], adjacent and affected hydrogen network operators shall design a project plan, including a request for cross-border cost allocation, and submit it jointly to the concerned regulatory authorities for a joint approval.

Removed2. The project plan and request for cross-border cost allocation shall be accompanied by a project-specific cost-benefit analysis, taking into account benefits beyond the borders of Member States concerned, and by a business plan evaluating the financial viability of the project, which shall include a financing solution and specify whether the hydrogen network operators involved agree on a substantiated proposal for a cross-border cost allocation.

Removed3. The concerned regulatory authorities shall, after consulting the hydrogen network operators, take coordinated decisions on the allocation of investment costs to be borne by each network operator for the project.

Removed4. Where the concerned regulatory authorities cannot reach an agreement on the request within six months, ACER shall take a decision, following the process pursuant to Article 6(10) in Regulation (EU) 2019/942.

Removed5. After 31 December 2030, all affected hydrogen network operators shall negotiate a system of financial compensation to ensure financing for cross-border hydrogen infrastructure in the event that no tariffs are charged for access to hydrogen networks at interconnection points between Member States pursuant to Article 6(7), of Regulation [recast Gas Regulation as proposed in COM(2021)xxx]. When developing that system, hydrogen network operators shall conduct an extensive consultation process involving all relevant market participants and shall take into account any decision of the regulatory authorities concerned or of ACER to charge tarrifs for access to hydrogen networks at interconnection points between Member States adopted pursuant to Article 6(7), of Regulation [recast Gas Regulation as proposed in COM(2021)xxx].

Removed6. The hydrogen network operators concerned shall agree on the system of financial compensation within 3 years and by 31 December 2033 and submit it to the regulatory authorities concerned for their joint approval. If no agreement is reached within that period, the involved regulatory authorities shall decide jointly within 2 years. Where the relevant regulatory authorities cannot reach a joint agreement within 2 years, ACER shall take a decision, following the process pursuant to Article 6(10) in Regulation (EU) 2019/942.

Removed7. The system of financial compensation shall be implemented in line with Article 72(1), point (b).

Removed8. For the transition to a system of financial compensation mechanism, existing capacity contracts shall not be affected by the established financial compensation mechanism.

Removed9. Further details required to implement the process set out in this Article, including required processes and time frames, process for reviewing and if necessary amending the compensation mechanism allowing taking into account tariff evolution and the development of the hydrogen networks, shall be set in a network code established on the basis of Article 54 of [recast Gas Regulation as proposed in COM(2021)xxx].

Removed9a. Paragraphs 1 to 9 shall not apply to hydrogen distribution network operators unless they operate cross-border infrastructure.

RemovedUnbundling of transmission system operators

Removedownership unbundling

Removed1. Member States shall ensure that:

Removed(a) each undertaking which owns a transmission system acts as a transmission system operator;

Removed(b) the same person or persons are entitled neither:

Removed(i) directly or indirectly to exercise control over an undertaking performing any of the functions of production or supply, and directly or indirectly to exercise control or exercise any right over a transmission system operator or over a transmission system; nor

Removed(ii) directly or indirectly to exercise control over a transmission system operator or over a transmission system, and directly or indirectly to exercise control or exercise any right over an undertaking performing any of the functions of production or supply;

Removed(c) the same person or persons are not entitled to appoint members of the supervisory board, the administrative board or bodies legally representing the undertaking, of a transmission system operator or a transmission system, and directly or indirectly to exercise control or exercise any right over an undertaking performing any of the functions of production or supply;

Removed(d) the same person is not entitled to be a member of the supervisory board, the administrative board or bodies legally representing the undertaking, of both an undertaking performing any of the functions of production or supply and a transmission system operator or a transmission system.

Removed2. The rights referred to in paragraph 1, points (b) and (c), shall include, in particular:

Removed(a) the power to exercise voting rights;

Removed(b) the power to appoint members of the supervisory board, the administrative board or bodies legally representing the undertaking; or

Removed(c) the holding of a majority share.

Removed3. For the purpose of paragraph 1, point (b), the term ‘undertaking performing any of the functions of production or supply’ shall be understood as including ‘undertaking performing any of the functions of generation or supply’ within the meaning of Directive (EU) 2019/944 of the European Parliament and of the Council, and the terms ‘transmission system operator’ and ‘transmission system’ shall be understood as including ‘transmission system operator’ and ‘transmission system’ within the meaning of that Directive.

Removed4. The obligation set out in paragraph 1, point (a), of this Article shall be deemed to be fulfilled in a situation where two or more undertakings which own transmission systems have created a joint venture which acts as a transmission system operator in two or more Member States for the transmission systems concerned. No other undertaking may be part of the joint venture, unless it has been approved under Article 55 as an independent system operator or as an independent transmission operator for the purposes of Section 3.

Removed5. For the implementation of this Article, where the person referred to in points (b), (c) and (d) of paragraph 1 is the Member State or another public body, two separate public bodies exercising control over a transmission system operator or over a transmission system on the one hand, and over an undertaking performing any of the functions of production or supply on the other, shall be deemed not to be the same person or persons.

Removed6. Member States shall ensure that neither commercially sensitive information referred to in Article 36 held by a transmission system operator which was part of a vertically integrated undertaking, nor the staff of such a transmission system operator, is transferred to undertakings performing any of the functions of production and supply.

Removed7. Where on 3 September 2009 the transmission system belonged to a vertically integrated undertaking, a Member State may decide not to apply paragraph 1. As regards the part of the transmission system connecting a Member State with a third country between the border of that Member State and the first connection point with that Member State's network, where on 23 May 2019 the transmission system belongs to a vertically integrated undertaking, a Member State may decide not to apply paragraph 1.

RemovedIn such case, the Member State concerned shall either:

Removed(a) designate an independent system operator in accordance with Article 55, or

Removed(b) comply with the provisions of Section 3.

Removed8. Where on 3 September 2009 the transmission system belonged to a vertically integrated undertaking and arrangements are in place which guarantee more effective independence of the transmission system operator than the provisions of Section 3, a Member State may decide not to apply paragraph 1 of this Article.

RemovedAs regards the part of the transmission system connecting a Member State with a third country between the border of that Member State and the first connection point with that Member State's network, where on 23 May 2019 the transmission system belongs to a vertically integrated undertaking and arrangements are in place which guarantee more effective independence of the transmission system operator than the provisions of Section 3., that Member State may decide not to apply paragraph 1 of this Article.

Removed9. Before an undertaking is approved and designated as a transmission system operator under paragraph 9 of this Article, it shall be certified in accordance with the procedures laid down in Article 65(4), (5) and (6) of this Directive and in Article 3 of Regulation (EC) No 715/2009. After that, the Commission shall verify that the arrangements in place clearly guarantee more effective independence of the transmission system operator than the provisions of Section 3.

Removed10. Vertically integrated undertakings which own a transmission system shall not in any event be prevented from taking steps to comply with paragraph 1.

Removed11. Undertakings performing any of the functions of production or supply shall not in any event be able to directly or indirectly take control over or exercise any right over unbundled transmission system operators in Member States which apply paragraph 1.

Removedindependent system operators

Removed1. Where on 3 September 2009 the transmission system belonged to a vertically integrated undertaking, a Member State may decide not to apply Article 56 (1) and to designate an independent system operator upon a proposal from the transmission system owner.

RemovedAs regards the part of the transmission system connecting a Member State with a third country between the border of that Member State and the first connection point with that Member State's network, where on 23 May 2019 the transmission system belonged to a vertically integrated undertaking, that Member State may decide not to apply Article 59(1) and to designate an independent system operator upon a proposal from the transmission system owner.