Reports on legal, economic and financial regulatory frameworks published

The current regulatory framework does not provide specific rules for an interconnected and integrated offshore electricity grid. So far, the focus of the (EU) framework has been on the regulation of point-to-point interconnectors. Also, clarity on the appropriate financial regulatory model of such an interconnected grid is still lacking. Therefore, the main objective of WP7 is to develop an appropriate European regulatory framework for the development of integrated offshore infrastructure. By April 2019, experts from the Florence School of Regulation, Groningen Centre of Energy Law and Deutsche WindGuard have worked on reports that deal with the development of the legal, economic and financial regulatory frameworks. The deliverables build upon work that has been done earlier in the project. Find out more about the content and download the deliverables for an extensive read.

Since 2016 experts have been working on developing target legal, economic and financial regulatory frameworks that would allow for the deployment of an integrated offshore electricity infrastructure. The ultimate goal is to ensure the safe, reliable and cost effective transmission of offshore wind to the shore through higher coordination of offshore wind deployment and expansion of transmission links into a meshed offshored grid.  
Deliverable 7.2 analyses the form and the contents of the target legal framework for the Meshed Offshore Grid (MOG). Considering the form, there is no ‘one size fits all’: different legal instruments are needed to reach a target legal framework that addresses all issues at the best level, that is, following the subsidiarity principle, the most immediate (most local) level at which the solution still is effective. Considering the contents, many different options are examined with an analysis based on costs/benefits, implementation time, socio-political acceptability and perspective of financing the MOG. A main result of the Deliverable is that a North Sea treaty is needed for governance of the offshore grid.
Deliverable 7.4 focuses on the development of an economic framework for the offshore grid in terms of three building blocks namely, planning, investment, and operation. The planning module covers the topics of cost-benefit analysis (CBA), coordinating onshore-offshore grid planning and public participation. The module on investment consists of cooperation mechanisms for renewable support, transmission tariffs, economic incentives and cross-border cost allocation (CBCA). Finally, the operation module addresses the impact of balancing mechanism design on offshore windfarms.
Deliverable 7.6 focuses on the financing challenges and particularly the parameters that have an impact on financing and provides solutions to address them as well as recommendations on appropriate financing structures that could attract investors and facilitate efficient investments in a MOG in the North Sea. In particular, the specifics of the MOG investment, the investor income, the financing strategies and possible grid ownership structures have been thoroughly investigated. Based on multi-stakeholder consultation, recommendations on the most crucial elements and structures that need to be in place in order to eliminate the risks for investors and thus, unlock MOG investments are presented.