Perspectives of the Pentalateral Energy Forum

Frederik Deloof,General Secretariat, Benelux Union

Pentalateral Energy Forum

The framework for regional energy cooperation in CWE region BE-NE-LUX-DE-FR-AT-CH§ Created & steered by Ministers for

Energy§ Promote market integration &

improve security of supply

2ElSeC 2017, Munich, 17th of October

Benelux, pioneer of regional cooperation …

3ElSeC 2017, Munich, 17th of October

1944:BENELUXCUSTOMS

UNION TREATY

1958:BENELUXECONOMIC

UNION TREATy

1985:SCHENGENAGREEMENT

2008:BENELUX UNION

TREATY Benelux Union TreatyArt. 2 Benelux aims to play a pioneering role

Benelux Union TreatyArt. 3 Focus on completion internal (energy) market

… provides the framework for regional energy cooperation in CWE …

4ElSeC 2017, Munich, 17th of October

2005:PENTALATERALENERGY FORUM

2008:(PENTALATERAL)GAS PLATFORM

2015:EXPERTISENETWORK

2016:NORTH SEAS

ENERGY FORUMLisbon Treaty Art. 350:

EU Treaty shall not preclude completion of

Benelux Union

#NSEforum17

Draft governance Regulation

Member States shall cooperate regionally

5ElSeC 2017, Munich, 17th of October

Bilateral agreements

Regional cooperation

EU market/Energy union

… towards EU market

PENTA=intergovernmentalinitiative between BE-NE-

LUX-DE-FR-AT-CH …

… whereby ministers of energy back politically a

regional integration process…

… as intermediate step to EU energy market

§ Inclusive stakeholder approach

§ Bottom up process

§ Intergovernmental not supranational

§ Political guidance by ministers

§ Cooperation based on shared interests

§ EU focus + subsidiarity

§ Pragmatic

§ Permanent support by (Benelux) secretariat

6ElSeC 2017, Munich, 17th of October

3 layers of Penta 1,0 regional cooperation

1. Building common understanding

2. Initiating and monitoring common projects

3. Political guidance facilitating cross-border decision-making

• Target model day-ahead market coupling

• TSO coordination• Flow-based Market Coupling• Pentalateral Generation

Adequacy Assessment• XB impact energy mix• Cost allocation

7ElSeC 2017, Munich, 17th of October

? layers of Penta 2,0 regional cooperation

1. Building common understanding

2. Initiating and monitoring common projects

3. Political guidance facilitating cross-border decision-making

• Cross-zonal allocation of capacities

• ? Network codes/ Guidelines• Increase performance flow-

based Market Coupling

• Simultaneous crisis situations• ? National energy & climate

plans

8ElSeC 2017, Munich, 17th of October

And for strengthening regional cooperation!

9

10

Back up slides

Summary

• Intergovernmentalinitiative– politicalbackingtoprocessofregionalintegrationasintermediatesteptowardsEUmarket

–Ministers’/ECinvolvement+TSO/NRA/MPP/PXs

– Coordinators+(Benelux)secretariat(=continuity)• MoU(2007)ofthePentalateralEnergyForum• PentaPoliticalDeclarationI(2013)&II(2015)• PentaMoU(2017)onriskpreparedness• Keepbalancebetweentop-down&bottom-up

Penta1.0‘poldermodel’

- firstregionaldialoguebetweenallrelevantparties…

- Ministers,CEOsofTSOs/NRAs/

PX/MPP…- jointlycommittocoupleelectricitymarkets…- accordingtosomegovernancerules…- andestablishTSOCooperationplatform

MinistersofEnergyBENELUX-DE-FR-AT(-CH)

SG1– MarketCoupling

SG2– SecurityofSupply

SG3–Flexibility

PentaCoordinators

BNLse

creta

riat

Penta1.0structure

Penta1.0governance

Penta1.0TSOcooperation

Penta1.0weaknesses

– Limitstoinformalnetworkapproach• Fromtalkingtoacting

• Differencesinunderlyingphilosophies– CEPparalysing effect– Visibilityofaddedvalue– Regionalcooperation=mainstream

– PatchworkofcooperationinCWE

– RegionalNRAlayer

Penta2.0inthepipeline

- Ministers(June‘17)discussedapreliminaryassessmentoftheCleanEnergyPackage

- ‘Bottomupregionalcooperationstillneeded’- Incubatorandtestingbedfornewideas?

- Keepdebateongoingbetweenlegaljumbo’s?

- Embedtechnicaldiscussionsinpolitical dialogue?- Updatedregionalcooperationbyendof‘17