Ref. Ares(2020)2890088 - 04/06/2020
Submission of the Adapted ENTSOG 2nd CBA Methodology
Ref: EGM1200-18
Final”). In line with Article 11.4 of the Regulation, ENTSOG, within three months of the day of
receipt of the last opinion, shall adapt the draft methodology taking due account of the opinions
received.
ENTSOG, welcoming the recommendations from ACER and the Commission, has duly taken into
consideration the input provided in their respective opinions when drafting the Adapted 2nd CBA
Methodology. The 2nd CBA Methodology also builds on the draft report issued by
Deloitte/Florence School of Regulation in December 20172 (hereafter EC Gas CBA Study).
Additionally, ENTSOG has appreciated the open dialogue had with the European Commission in
the past months. This has allowed ENTSOG to ensure that the draft Methodology meets all the
main received recommendations. The 2nd CBA Methodology, in its adapted version, is significantly improved from the 1st CBA
Methodology, and also provides strong improvements compared to the draft Methodology
submitted by ENTSOG to ACER and the Commission in July 2017.
Respect to the opinions received, here below the main improvements included in the Adapted
2nd CBA Methodology:
1.
Restructuring to the document: the Adapted 2nd CBA Methodology has been significantly
restructured compared to the draft methodology;
2.
Increase in transparency: compared to previous TYNDP editions, the application of the CBA
Methodology to TYNDP foresees the performance of project-specific cost-benefit analysis
(project-specific CBA) as part of the TYNDP process for all projects intending to apply for the
PCI label, ensuring in such a way transparency, level-paying field and comparability of results.
Additionally, the Adapted 2nd CBA Methodology sets as a requirement that all project
promoters provide cost data when submitting their project to TYNDP;
3.
Project grouping guidelines: the Adapted 2nd CBA Methodology includes basic grouping
principles to be applied when running the project-specific CBA;
4.
Refined market modelling assumptions: as one of the main expectations from ACER, the
Commission and stakeholders, the Adapted 2nd CBA Methodology provides an enhanced
market modelling approach. The Methodology includes an extensive section that elaborates
on market modelling assumptions and provides guidelines for the inclusion of additional
market elements in the assessment. These market elements include infrastructure tariffs and
other commercial provisions such as long-term contracts. Additionally, the Methodology also
includes a section on demand elasticity;
5.
Indicators simplification: the 2nd CBA Methodology focuses on the most relevant indicators
from the perspective of decision-makers and project promoters. Overlapping indicators have
been discarded, preventing from the risk of double counting. The methodology also explains
how to correctly interpret the remaining ones;
2 http://fsr.eui.eu/event/gas-cba-2-0-online-consultation/
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