Functional electricity markets, in particular electricity transmission grids and other assets related to electricity supply, are essential for public security, economic competitiveness and the well-being of the European Union (EU) citizens. In the past, trans-European electricity transmission networks were managed in accordance with national rules regulating the activities of transmission system operators and how access to cross-border transmission networks by market participants is ensured.
Due to the growing number of cross-border interconnections in the European Union's internal electricity market, the need for EU-wide rules to effectively manage electricity flows has increased. Therefore, rules known as network codes and guidelines, which are legally binding implementing regulations of the European Commission, were developed. A total of eight European Commission implementing acts adopted in addition to Regulation (EC) No 714/2009 of the European Parliament and of the Council on conditions for access to the network for cross-border exchanges in electricity and repealing Regulation (EC) 1228/2003, establish the principles of cross-border electricity market transactions and system operation management.
The electricity network codes and guidelines cover the following areas:
- Network connection requirements;
- Network operating conditions;
- Single electricity market framework.
Among other things, network codes and guidelines determine which proposals for regulations, methodologies or other documents in the three areas mentioned should be developed by TSOs or nominated electricity market operators (NEMOs) and submitted to the competent regulatory authorities for approval. Taking into account the scope of application of laws and documents, the approval of proposals may require:
- Approval of all regulatory authorities;
- Approval of all regulatory authorities in the region concerned or;
- Individual approval by the regulatory authority of each participating Member State.
If the regulatory authorities cannot agree among themselves on the approval of the submitted proposal, the decision shall be taken by the Agency for the Cooperation of Energy Regulators (ACER).