Council Decision (EU) 2025/172 of 17 December 2024 on the position to be taken on behalf of the European Union within the Specialised Committee on Energy established by the Trade and Cooperation Agreement between the European Union and the European Atomic Energy Community, of the one part, and the United Kingdom of Great Britain and Northern Ireland, of the other part, as regards the adoption of a recommendation concerning the preparation of technical procedures for the efficient use of electricity interconnectors

The position to be taken on the Union’s behalf within the Specialised Committee on Energy established by Article 8(1), point (l), of the Trade and Cooperation Agreement between the European Union and the European Atomic Energy Community, of the one part, and the United Kingdom of Great Britain and Northern Ireland, of the other part, is set out in the draft recommendation of that Committee attached to this Decision.

This Decision shall enter into force on the date of its adoption.

The Specialised Committee acknowledges that the Preliminary Order Books approach is not a viable way forward for the further development of a Multi-region loose volume coupling (‘MRLVC’) solution and recommends that the Parties not pursue it further.

The Specialised Committee recommends that each Party request that its respective TSOs for electricity and, for the Union, the European Network of Transmission System Operators for Electricity (‘ENTSO-E’) facilitating the work of EU TSOs jointly commence an initial concept-validation phase prior to producing the single set of initial draft technical procedures for MRLVC in accordance with Annex 29 to the Trade and Cooperation Agreement and with supporting analysis, comprising: (a) an optimal operational timeline combining the operations of the MRLVC, the EU Single Day-Ahead Coupling and the Great Britain wholesale electricity market arrangements under a Common Order Book approach, including the optimal validation and fallback arrangements. The optimal operational timeline should promote the robust and efficient use of interconnectors while minimising risks for the secure operation of the EU and UK electricity wholesale markets and taking into account possible market developments up to 2030-35. The operational risks linked to that timeline on both the EU Single Day-Ahead Coupling and the Great Britain wholesale electricity market should be assessed and, to the extent possible, quantified. A range of options for operational timelines should be included in the supporting analysis to support the identification and assessment of the validity of an optimal timeline; (b) a draft tender specification for a prototype for a bordering bidding zone net position forecaster which should: (i) include a detailed description of requirements, including: the methodology (e.g., statistical and/or deterministic) to be employed; specific outputs that would be required from the forecaster; how the forecaster will incorporate future market developments, including the future introduction of new bidding zones whether onshore or offshore; how outputs from the forecaster will be inputted into wider MRLVC processes; any other key requirements identified through the work set out under point (a) of this Article and Article 3; (ii) be accompanied by: information on how the tender would be issued and governed, including consideration of ownership and intellectual property rights; a detailed breakdown of anticipated timings and costs; any relevant issue related to administrative functions required to address EU and UK system interdependencies in the implementation of an MRLVC solution.

1 The Specialised Committee recommends that the Parties request that their respective TSOs for electricity and, for the Union, the ENTSO-E facilitating the work of EU TSOs produce a joint report for the Specialised Committee investigating any barriers to the delivery of joint and hybrid offshore projects that may result from existing trading arrangements or MRLVC, and any specific changes needed to existing trading arrangements or specific requirements of the design of MRLVC needed to deliver efficient electricity trading that supports the delivery of joint and hybrid offshore projects.

2 The TSOs joint report should: (a) investigate the impact of both existing trading arrangements and an MRLVC solution on joint and hybrid projects, over the medium term (2030-2035 horizon), with a particular focus on: (i) the scope of the application of the trading arrangements, and whether and how the performance of capacity allocation may be affected; (ii) how these trading arrangements could operate with different market designs, in particular offshore bidding zones; and (iii) whether there may be sufficient clarity in the business case for infrastructure investment; (b) take into consideration: (i) the nature and scale of possible offshore renewable energy infrastructure developments across the North Seas in the medium term, including possible hybrid interconnectors, energy islands, meshed grids and offshore electrolysers; (ii) possible mechanisms of price formation; (iii) the complementary role of forward and intraday trading arrangements; (iv) the impact on the accuracy of bordering bidding zone forecasts; and (v) any specific adjustments that may be required in the design features of these trading arrangements, within their general confines, to help address any identified barriers and/or requirements in the development and operation of joint and hybrid offshore projects to deliver efficient trading arrangements.

The development of the work recommended under Articles 2 and 3 should involve regular oversight and input by the Parties. It may also involve the TSOs engaging with wider stakeholders that may include regulators, nominated electricity market operators/power exchanges, and academia.

The Specialised Committee recommends that the Parties coordinate their communication with their respective TSOs for electricity and, for the Union, the ENTSO-E facilitating the work of EU TSOs with respect to Articles 2 and 3 and request that they complete the work listed under those Articles within 11 months of the adoption of this Recommendation.

The Specialised Committee recommends that the Parties request that their respective TSOs for electricity and, for the Union, the ENTSO-E facilitating the work of EU TSOs request an informal opinion of the UK national energy regulators and ACER regarding their work completed with respect to Articles 2 and 3, to be delivered within one month of the delivery of the TSOs joint report.