21.12.2015

ACER adopted a new Recommendation on cross-border cost allocation (CBCA)

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​On 18 December 2015, the Agency adopted a new Recommendation  regarding good practices for the treatment of the investment requests including cross border cost allocation (CBCA) requests for electricity and gas projects of common interest (PCI). This Recommendation aims to facilitate future CBCA processes and to provide guidelines to and share good practices with project promoters and NRAs. It replaces the Agency’s Recommendation No 07/2013  on CBCA.

The new Recommendation is built upon the experience gained with the first investment requests for PCIs and addresses a number of challenges and open issues raised by NRAs and stakeholders, as briefly described in the Agency’s Summary report “Experience with Cross-Border Cost Allocation” of September 2015. The new Recommendation provides: a) project promoters with guidelines to better fulfil the requirements of Regulation (EU) No 347/2013 when submitting an investment request; b) NRAs with the main principles to be followed when treating an investment request and deciding on the cost allocation across borders.

Background:

Regulation (EU) No 347/2013 aims to facilitate PCIs implementation by envisaging decisions by NRAs or by the Agency on the allocation of the costs of such projects across borders if project promoters submit an investment request including a request for CBCA.

Article 12 of Regulation (EU) No 347/2013 specifies the legal requirements regarding the submission of investment requests, including a CBCA decision. The Agency has deemed essential to provide clarifications and details with regard to certain elements of the “CBCA procedure” and thus assist NRAs and promoters of PCIs in adopting a consistent and streamlined EU-wide approach to investment requests.

The Agency’s first CBCA Recommendation,  adopted on 25 September 2013, referred to the investment requests submitted in the framework of the first Union list of electricity and gas PCIs. This first CBCA recommendation foresaw its revision and completion before the deadline for the submission of CBCA requests following the adoption of the second Union list of PCIs.

New elements:

The Agency’s first CBCA Recommendation has been revised in many parts, including the assessment of project maturity, information requirements of an investment request, as well as the main principles for cross-border compensation and cost allocation. The new Recommendation clarifies that CBCA decisions shall be final, while they may contain specific ex-ante mechanisms for adjustments. Moreover, the new Recommendation also provides guidance on: treatment of uncertainties, CBA calculations, TSO consultation process, submission of investment requests, reporting requirements, cross border payments and evaluation of impacts on network tariffs.