ENTSOG TYNDP 2015

7.6 Market integration, a constant challenge

ENTSOG has implemented in this TYNDP the CBA methodology published in summer 2014 and approved by the European Commission in February 2015. It brings further the concept of infrastructure-related market integration capturing its benefits through a new series of indicators. These indicators aim at signalling the availability and origin of supply and identify possible lack of infrastructures. As required by the TEN-E Regulation indicators now also cover the price dimension of gas, coal and CO 2 emissions. For 2015, results confirm that market integration is a reality for a large part of Europe. This is confirmed by the actual price convergence in large part of Western Europe as well as the increasing price correlation across the continent. In fact the effect could be more visible if the European regulatory framework would be fully implemented. Nevertheless other regions suffer from a lack of sufficient integration or even from isolation. Such situation translates into high supply dependence on Russian gas in the Baltic region, Central-Eastern and South-Eastern Europe and to LNG in the Iberian Peninsula and South of France. The Baltic region and South- Eastern Europe are still vulnerable to a disruption of the transit of Russian gas through Belarus and/or Ukraine. On the medium term the commissioning of already decided project will slightly improve the situation. But many more investment decisions are required to have an Integrated Energy Market covering all EU Member States. After 2025 the situation changes, especially under the Green demand scenario, with a much tighter supply and demand balance. The whole Europe would then risk to become strongly dependent on both Russian gas and LNG. Given Europe situation of price-taker on the LNG market, it would put the continent under the influence of few external producers. This situation is consistent with the overall supply adequa- cy as analysed in the Supply chapter. Only access to new indigenous or pipe-bound sources will mitigate this dependence.

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Ten Year Network Development Plan 2015 |

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