Informing the national and regional investment strategies

Background and context

Community funding programmes support national and regional stakeholders' investment decisions in the power system field.

Defining investments on smart and resilient electricity system requires the interaction of multidisciplinary players, with different interests and values, and the adoption of new business models and regulatory frames.

Projects of Common Interest (PCIs) are key energy infrastructure projects, which will help Member States to integrate their energy markets, allow a greater diversity of supply sources and help power grids to cope with the increasing amounts of renewable energy, thus contributing towards the CO2 emissions reduction.
The Smart Specialisation Strategy on energy aims at enabling European regions to better identify and develop their own competitive advantages in the energy sector. Smart Specialisation represents a precondition ('ex-ante conditionality') for Cohesion Policy funding. Through the creation of regional partnerships and thus through a bottom-up approach, Smart Specialisation brings together local authorities, academia, business spheres and the civil society, working towards the implementation of long-term growth strategies supported by EU funds.

Our role

We support investment decision processes linked to the Projects of Common Interest and the Smart Specialisation Platform on energy. Our aim is to help national and regional stakeholders' strategic investment decisions via community funding programmes such as the Cohesion Fund, the Connecting Europe Facility, the European Structural and Investment Funds (ESIF), Horizon 2020 and others

We support the Regional Groups in assessing the candidate project's compliance with the criteria laid down in the Regulation (EU) 347/2013 and its added value on a European-level, notably in the fields of electricity transmission/storage and of smart grids. The list of PCI projects is to be updated every two years. The Regional Groups, headed by the European Commission, are comprised of representatives from Ministries, national regulatory authorities and the transmission system operators and project promoters, ENTSO-E, the Agency for the Cooperation of Energy Regulators (ACER) and other participants. Regulation 347/2013 calls upon the development of a methodology by ENTSO-E for harmonised energy system-wide Cost-Benefit Analysis (CBA) at Union level for Projects of Common Interest. Building on our expertise in the technical and economic assessment of energy projects, we have been entrusted with the development of a ranking methodology for Projects of Common Interest in the European electricity (and gas) infrastructure and we also developed a multi-criteria assessment framework for Projects of Common Interest in the field of Smart Grids.
We support the Cohesion Policy through smart specialisation and help answering questions such as: What is my region/country best at? How to be competitive using our strengths? Can efforts of regions/countries be combined? The Smart Specialisation Strategy (S3) complements market forces in guiding regions towards optimal productive positioning by coordinating the private and public sectors' response to the international competitive challenges. The three guiding principles of the Smart Specialisation Platform are: identify the region’s own strengths and comparative assets (smart); prioritise research and innovation investments in the competitive area (specialised); define a shared vision for regional innovation (strategic). This is a bottom-up participatory process (carried out via 'Entrepreneurial discovery'), aimed at gathering and diffuse information, rather than a top-down approach. To this end, we facilitated contacts between the regions interested in the deployment of smart grid solutions. Through the organisation of meetings, questionnaires and bilateral interviews with the regions and with their technical experts, we have been able to gain a clear understanding of the regions' strengths and of the motives of their interests in such innovation area. Our aim is to accompany the interested parties in the implementation and execution of transregional smart grid projects.

2019 - Identification of projects of common interest in the priority thematic area of smart grids

The document presents the outcome of the evaluation process of candidate Projects of Common Interest in the priority thematic area of ‘smart grids deployment’, as set out in the trans-European energy infrastructure regulation.

The evaluation follows the guidelines of the assessment framework for smart grid Projects of Common Interest, 2017 update, developed by the JRC and adopted within the smart grid thematic group.

The report aims to assist the smart grids thematic group in proposing projects of common interest in the area of ‘smart grids deployment’ to be included in the 4th Union list of Projects of Common Interest.

2017 - Evaluation of Smart Grid projects for inclusion in the third Union list of Projects of Common Interest

This report presents the outcome of the evaluation process of candidate Projects of Common Interest in the priority thematic area of ‘smart grids deployment’, as set out in the trans-European energy infrastructure regulation.

The evaluation follows the guidelines of the assessment framework for smart grid Projects of Common Interest, 2017 update, developed by the JRC and adopted within the smart grid Regional Group.

The report aims to assist the smart grids Regional Group in proposing projects of common interest in the area of smart grids deployment to be included in the 3rd Union list of Projects of Common Interest.

2017 - Assessment framework for Projects of Common Interest in the field of Smart Grids

This report presents an update of the assessment framework to evaluate smart grid projects of common interest, in line with Regulation (EU) 347/2013 on guidelines for trans-European energy infrastructure. In this context, every two years the European Commission establishes an EU-wide list of projects of common interest (PCIs), consisting of key energy infrastructure projects in the EU. These are essential for deepening the interconnection of Europe's internal energy market and reaching the EU’s energy policy objectives of affordable, secure and sustainable energy.

The assessment framework for smart grid PCI candidates is based on Annex V to the Regulation and it consists of: i) a checklist to verify project compliance with the general criteria, set out by the Regulation in Article 4(a) and (c); ii) a cost–benefit analysis to argue the economic viability of the project; and iii) an analysis based on key performance indicators (KPIs) for the evaluation of the non-monetary impacts. The assessment methodology is intended to guide project promoters in preparing their project proposals and assist the Smart Grid Regional Group in proposing smart grid projects of common interest.

2016 - RES diffusion and R&D investments in the flexibilisation of the European electricity networks

The present paper adds up to the discussion carried around the flexibilisation of the electricity networks, as a mean of higher diffusion of renewable energy sources (RES). Inspiring from innovation studies the paper proposes an economic rationale for considering RES technology manufacturers as investors in electricity networks. Moreover, the present analysis scrutinize the extent to which the various economic operators within specific segments of the power supply chain invest in a portfolio of research and development activities, among which the electricity grids and storage technologies. The intensity of these research investments was mapped across the European countries for the year of 2011. Their geographic distribution confirms the rationale of an analysis based on canonical correlation testing the associations between RES market diffusion and power network indicators. The analysis provides useful insights for specific technology, such as the one revealing PV market sensitivity to research investments in storage technologies, confirming a potential business model coupling the two technologies. Accommodating this pattern and enabling further diversification of research portfolios, the public incentives could be redesigned in order to address the flexibilisation of power networks.

2016 - Smart Mediterraneo. Best practices, innovation and pilot projects

This workshop (proceedings here, agenda and presentations here) focused on best practices, innovation and pilot projects in smart grid development in the Mediterranean region. This workshop was organised in the framework of the Smart Specialisation Platform for Energy (S3PEnergy) and aimed at building synergies among the regions of the Mediterranean Sea to exchange experiences and best practice in the field of smart grids. Regional authorities, companies, universities and research centres met and exchanged knowledge on Smart Specialisation, energy and cohesion policy, novel funding opportunities and challenges and opportunities coming from the new regulation of the retail market. This workshop served as the occasion for interactions between local and international stakeholders with the aim to reinforce links between their projects, needs and expertise along with the perspectives of Smart Specialisations including activities in smart grids technologies. The main conclusion of the event was that the smart grids sector faces several challenges and obstacles such as need of more targeted interregional cooperation and higher engagement of private sector. Future scenarios, initiatives and interventions in this field should capitalise on existent evidence and results facilitated for instance in the frameworks of the 459 projects carried out across Europe. The need to address smart grids according to regional specific contexts (e.g. Mediterranean) would provide more efficient results.

2016 - Smart Grid Challenges and Opportunities in the Baltic Region

This workshop (agenda and presentations are available here) aimed to facilitate an exchange about the implementation of the Smart Specialisation (S3) priorities related to Smart Grids in the Baltic region.

Our team regularly monitors the transition of the EU power network towards future digital grids, observing advances, developing models and making analyses. The event addressed specific examples of how S3 regions are preparing the ground for smart grid deployment, including interrregional cooperation as a key driver to support S3 implementation and the effective uptake of the Cohesion Policy Funds for smart srids.

The workshop offered an opportunity for the industry, research & innovation sectors, regional authorities and other stakeholders to exchange good practices and innovative concepts supporting S3 and energy policy in the Baltic region. The event was organised by the JRC in the framework of the Smart Specialisation Platform on Energy (S3PEnergy). Close collaboration of the Latvian Ministry of Economic Affairs and the Riga Technical University made of this event a key step towards interregional cooperation on smart specialisation priorities related to smart grids.

2015 - Establishment of the second list of Union Projects of Common Interest

This report presents the outcome of the evaluation process of candidate Projects of Common Interest in the area of Smart Grids, under the trans-European energy infrastructure regulation.

Three candidate projects have been submitted and evaluated, namely: North-Atlantic Green Zone (Member States: Ireland and UK-Northern Ireland), GREEN integration of renewable energy in the north Mediterranean (Member States: Italy and France) and SINCROGRID (Member States: Slovenia and Croatia).

The evaluation follows the guidelines of the assessment framework for Smart Grid projects, developed by the JRC within the EC Smart Grid Task Force.

2014 - Assessment framework for projects of common interest in the field of smart grids

The document presents the methodology elaborated by the JRC within the Smart Grids Task Force, Expert Group on Smart Grid Infrastructure Deployment (Expert Group 4).

The Regulation 347/2013 on guidelines for trans-European energy infrastructure provides for the establishment of a EU-wide list of "Projects of Common Interest", a label identifying key energy infrastructure projects in EU. Within this framework, Expert Group 4 had the mandate to define an evaluation framework for projects proposals in the field of smart grids.

On the basis of its experience on Cost Benefit Analysis of smart grid projects, the JRC developed a multi-criteria assessment framework including: a) a checklist to verify that project proposals meet the requirements set out by the Regulation; b) a techno-economic assessment through Key Performance Indicators to capture the key features of each project; c) a Cost Benefit Analysis of each projects.

2013 - Evaluation of Smart Grid projects within the Smart Grid Task Force Expert Group 4

This report presents the outcome of the evaluation of smart grid energy infrastructure project proposals carried out by Expert Group 4 (EG4) of the Smart Grid Task Force. This process was carried out using the assessment framework developed by EG4 for Projects of Common Interest (PCI) in the field of smart grids. This latter and the present document shall serve as guidance for the regional groups when proposing and reviewing PCI, under the trans-European energy infrastructure regulation (Regulation (EU) No. 347/2013).

Project promoters will be asked to demonstrate the project’s economic viability and cost-effectiveness in accordance with the trans-European energy infrastructure regulation (Art. 4(1) (b)), by explaining how potential benefits will outweigh the project costs, and will support their case with a societal cost-benefit analysis and qualitative appraisals of benefits that cannot be reliably monetised.

Fulfillment of the technical requirements is a precondition for further evaluation of a project proposal, according to the policy and economic criteria.