You have questions about the EU DSO Entity, we have answers for you
One result of the Electricity Regulation (EU) 2019/943 is, considering Article 52 (et sqq.), the establishment of a new entity (EU DSO Entity) which will serve as a technical and representing body and which will be officially part of the European legislation process, mainly for the elaboration of Network Codes. The EU DSO Entity shall give electricity Distribution System Operators (DSOs) a coherent voice in the European institutional setting vis-a-vis the European Commission, ENTSO-E and ACER. The EU DSO entity will focus on technical issues and is assigned with tasks such as the development of Network Codes. The Network Codes – in those domains determined in the Electricity Regulation – will define and regulate the work, roles, technical requirements and processes for all European DSOs. The EU DSO Entity will have European DSOs as registered members, who can either participate directly or indirectly (via their national or European associations). It will have an organisational set-up consisting of a General Assembly, a Board of Directors, a Secretary General, a Strategic Advisory Group and Expert Groups.
Yes, from the DSOs part.
The Board of Directors will consist of 27 Directors and a Presidency. The membership of the EU DSO Entity will be divided into 3 categories: members with less than 100 000 connected customers – category 1, members with at least 100 000 and less than 1 million connected customers – category 2, and members with at least 1 million connected customers – category 3. Each category will send nine representatives to the Board. To insure a balanced representation, the Board can consist only of a maximum of 3 representatives of Members based in the same Member State or from the same industrial group. In addition to the Directors and the President, European and national associations representing electricity DSOs will be permitted to participate as ‘Observers’ at the meetings of the Board.
The Expert Groups are responsible for the technical work on Network Codes and development of proposals for guidelines, technical best practice papers and cross sectoral matters. Expert Groups also provide advisory opinions. They will be composed of experts from DSO members, and – for maximum 1/3 – from external organizations (including national associations).
The Strategic Advisory Group is a forum for consultation on matters pertaining to the EU DSO Entity. Its main task will be to deliver opinions on relevant decisions and projects. It will be composed of the 4 EU associations representing DSOs (CEDEC, E.DSO, Eurelectric, Geode) and representatives of Member States that are not represented in the Board of Directors.
The ‘cooperation principles’, beyond formal consultation procedure, especially with ENTSO-E will be defined and agreed with ENTSO-E. That principles will be followed on Network Codes (in convening the drafting committee, developing the text, submitting the draft to ACER, monitoring its implementation), so as on coordinated operation and planning of the transmission and distribution systems.
An Associate Member has the rights and obligations mentioned in the Statutes. Associate Members cannot be in the Board, but they have the right to attend the General Assembly and participate in the discussions without any voting power and shall be subject to confidentiality undertakings. Please be aware that the final status of the membership of the EU DSO Entity will be decided by the European Commission.
By 5 July 2020, the distribution system operators will submit to ACER and to the Commission the draft statutes, including a code of conduct, a list of registered members, the draft rules of procedure, including the rules of procedure on the consultation with ENTSO-E and other stakeholders, and the financing rules. Within 2 months of receipt of the above mentioned documents, ACER will provide the Commission with its opinion. Within 3 months of receipt of ACER’s opinion, the Commission will deliver an opinion on the documents, taking into account ACER’s opinion. Finally, within 3 months of receipt of the Commission’s positive opinion, the DSOs will establish the EU DSO Entity and adopt and publish its statutes and rules of procedure. The EU DSO Entity will be fully set up by 1st quarter 2021.
DSOs are becoming more and more relevant for safeguarding the security of supply of electricity, as they evolved from sole distributors of electricity to active system managers with more than 90% of renewable energy sources connected to their grids. There exists already a similar body for Transmission System Operators (TSOs) – ENTSO-E – since 2009. Due to the increasingly important role of DSOs, an official and transparent participation of DSOs in the legislation process for the development of Network Codes is justified and needed. As the European Commission, the European Parliament, Member States and the NRAs have recognized this new role and granted the establishment of the EU DSO Entity, DSOs should embrace this new opportunity and make their voice heard to ensure that their interests and values influence the decisions of the EU DSO Entity.
DSOs who are members of the EU DSO Entity will have many ways to shape the work of the Association. Each member DSO can get involved: by attending and voting in the meetings of the General Assembly, the leading body of the Association which determines the strategic lines regarding the activities of the EU DSO Entity; by proposing a representative in the Board, which is in charge of implementing the strategic decisions; or by being part of the Expert Groups or the Strategic Advisory Board. Within the General Assembly, members can adopt strategic decisions regarding the activities of the EU DSO Entity, elect and dismiss the members of the Board, endorse decisions of the Board on Network Codes, adopt the annual work programme and establish Expert Groups.
Yes, a DSO from a non-EU country can also join the EU DSO entity. An electricity DSO can either become Member of the Association or Associate Member. Whether a DSO qualifies as Member or Associate Member is stipulated in the statutes and depends on whether the country of origin has the obligation to implement relevant EU energy legislation or not.
An electricity DSO operating in a country outside the EU can only become a Member of the Association if the country of origin participates in the European single market for electricity via the European Economic Agreement, EEA Agreement (e.g. Iceland or Norway), or is in bilateral agreement with the EU with the obligation to implement relevant EU energy legislation.
An electricity DSO belonging to a non-EU country that does not fulfil the criteria above may be admitted by the General Assembly as Associate Member only. Associate Members will have the right to attend the General Assembly but will not have voting power. Associate Members are not entitled to attend the Board meetings or to nominate experts in the Expert Groups.
No, as the Electricity Regulation is limited to electricity, the scope of the EU DSO Entity is currently limited to electricity only. However, as the Gas Market legislation will be reviewed in line with the review of the Electricity Market legislation, it can reasonably be expected that a parallel EU DSO Entity for gas will be set up in the coming years.
The membership of the EU DSO Entity will be divided into 3 categories: members with less than 100 000 connected customers – category 1, members with at least 100 000 and less than 1 million connected customers – category 2, and members with at least 1 million connected customers – category 3. Each category will send nine representatives to the Board, and thus be equally represented within the Board.
In the General Assembly, each member disposes of a number of votes proportional to the number of that member’s customers. Within the General Assembly, decisions are adopted according with the following rules:
No, an association cannot become a (associate) member of the EU DSO Entity, but individual DSOs can.
Non-voting members. The national Associations can be Observers in the Board meetings. (Existing European Associations which represent electricity DSOs at EU level, or national associations representing electricity DSOs that belong to an EU Member State or a non-EU country which participates in the European single market for electricity via the European Economic Agreement(EEA) or is in bilateral agreements with the EU with the obligation to implement relevant EU energy legislation, in particular Network Codes, are permitted to participate as Observers in the meetings of the Board as established in the Rules of Procedure. Observers may be invited to attend the General Assembly meetings)
Yes, except information for which the confidentiality rules apply.
Associate Members are not entitled to nominate experts to the Experts Groups (Article 7 para.4 of the Statutes). Strategic Advisory Group consisting of representatives of the European associations representing DSOs according Article 1.32 and one (1) DSO representative of those Member States which are not represented in the Board. The Country Expert group will be composed by 1 DSO from each Member State + 1/3 coming from our side the membership.
Would the founder associations (CEDEC, E.DSO, Eurelectric and GEODE) as members of the Strategic Advisor group share the information and discuss the documents of the EU DSO entity with their members ?
Nothing prevents the founder associations from sharing the documents and information gathered in those meetings with their members, except information which are strictly protected by confidentiality.
The general criteria to the Experts group members are provided in Article 19 of the Statutes and Article 5 of the Internal procedures.
It is too early to talk about specific criteria. It would certainly depend on the EU DSO Entity areas of work and priorities. The most important thing to point out is that the experts group need to have a strong expertise and support the work of the EU DSO Entity, in particular on development of Network Codes. The Entity will highly rely on their expertise.
Article 19 of the Statutes defines the rationale of the experts group, namely: "The Expert Groups are responsible for the technical work on Network Codes and development of proposals for guidelines, technical best practice papers and cross sectoral matters."
They also provide advisory opinions. Each Expert Group has the obligation to regularly report on its activities to the Board and other involved Expert Groups.
No, there is no deadline for a DSO to register. DSOs interested in joining the EU DSO Entity can already register by using the online registration form on the website of the EU DSO Entity/this website. Please note that, to be able to attend the 1st General Assembly, the registration to become member shall be completed online before January 1st 2021/or by 31 December 2020 the latest.
The membership fee will be defined in the statutes of the EU DSO Entity. In line with the Electricity Regulation, it will be “fair and proportionate that will reflect the number of connected customers”.
There will be no direct financial impact for the company as the membership fee will be financed through grid tariffs at national level, as laid down in Article 53 para. 7 of the Electricity Regulation where it is stated that all reasonable costs will be covered by national grid tariffs.
Yes, a Member or Associate Member can cancel its membership at the EU DSO Entity. DSOs have the right to resign from the EU DSO Entity provided that they give six months prior written notice to the Secretary General.
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The EU DSO Entity will focus on technical issues, promoting the optimal and coordinated operation and planning of DSO/TSO networks, participating in the elaboration of EU Network Codes which are relevant for DSO grids.