ENTSOG South-North Corridor GRIP 2017 - Main Report

4.1.1 SECURITY OF SUPPLY

As many Member States rely mainly on a limited number of suppliers for their natural gas – with many Eastern European countries entirely dependent on Russian exports – and considering the increased vulnerability to supply disruptions and infrastructure failure that a condition of limited supply diversification creates, the European Commission released in May 2014 its Energy Security Strategy . The aim of the short and long term measures included in the document is to ensure a stable and abundant supply of energy for citizens and the overall EU economy. Short-term measures have been identified through a series of security of supply stress tests carried out in 2014 and they were mainly focused on possible prolonged disruption situations of Russian gas imports to Europe. Identifying substantial im- pacts especially on Eastern EU countries, the fundamental recommendation valid in the short-term framework is that cooperation and solidarity between countries can play an effective role in mitigating the impacts of a potential supply crisis. In terms of long-term challenges addressed in the Energy Security Strategy , the fol- lowing key action areas are identified with particular relevance for gas infrastructure operators: \\ The completion of the internal energy market and implementation of missing infrastructure links to allow a swift response to supply disruptions and redirecting of energy across the EU to where it is needed. \\ The increase of energy production in the EU, including renewables and sustainable production of fossil fuels. \\ An increased diversification of supply sources and routes, including effective negotiation with current major energy partners, such as Russia and Norway, as well as new partners in the Caspian Basin. \\ The strengthening of emergency and solidarity mechanisms and protection of critical infrastructure, which entails more coordination between EU countries to use existing storage facilities, develop reverse flows, conduct risk assessments and implement security of supply plans at regional and EU level. A fully integrated internal market represents the most effective and efficient way to ensure secure and affordable energy supplies on equal conditions across Europe. To build an internal competitive and interlinked environment for energy production and exchanges, harmonised market rules (so-called “software” ) and essential infra- structure (so-called “hardware” ) are reciprocally beneficial and therefore both essential. The main achievements in this direction are represented by market legislation (Unbundling Directives) and Regulations (Network Codes and transparency rules, as REMIT, together with the TEN-E regulation for Projects of Common Interest). On the one hand, EU legislation makes sure that energy companies cannot exclude competitors from access to pipelines or withhold the construction of important infrastructure. On the other hand, EU Regulations establish and enforce the implementation of harmonised rules for the access to and the efficient usage and enhancements of energy networks. The final goal of an integrated market is to guarantee that energy can flow across EU countries following price signals, without administrative or infrastructural obstacles. In this way, gas and electricity supplies would be delivered to each EU citizen at the most favorable conditions.

4.1.2 COMPETITIVENESS

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South-North Corridor GRIP 2017