The General Court of the European Union annulled the decision of the Agency for the Cooperation of Energy Regulators (ACER) approving the ‘HUAT’ project to create additional capacity for the transport of Black Sea gas between Hungary and Austria, in a judgment delivered on Wednesday 16 March (Joined Cases T-684/19 & 704/19). This decision was effectively adopted by virtue of provisions of the ‘Network Code’ Regulation (2017/459) relating to the process of creating additional capacity for gas transport, which the General Court considers inapplicable.
The Hungarian energy and public utility regulatory authority, FGSZ, and the Hungarian energy regulator, MEKH, are contesting ACER’s decision to authorise the ’HUAT’ project, while the Hungarian authority, unlike its Austrian counterpart, has given an unfavourable opinion on the project. According to MEKH, the basic regulation (715/2009) on conditions for access to the gas transmission networks, which served as a basis for the adoption of the ‘Network Code’ Regulation, does not allow the European Commission or the European Network of Transmission System Operators for Gas (ENTSO) to adopt a network code providing for the creation of additional capacity for which a national operator would be obliged to invest.
In its judgment, the General Court upholds the actions of the Austrian and Hungarian authorities. It notes that the concept of capacity in the basic regulation refers only to existing capacity on the network, and congestion management is only considered on the basis of existing capacity. In its view, the development of the network is primarily a matter for the Member States, with ENTSO facilitating the coordination of the exercise of this competence and merely identifying possible investment gaps, especially with regard to cross-border capacity.
Consequently, the General Court held, the basic regulation does not authorise the ENTSO network or the European Commission to adopt rules on the creation of additional capacity on the network. Under the Gas Directive (2009/73), a gas transmission system operator is obliged to make the necessary investments to ensure the proper functioning of the network and, if necessary, to create additional capacity.
In these circumstances, the European Court declares inapplicable the provisions of the ‘network code’ regulation governing a procedure for imposing an obligation on a national gas transmission system operator to create additional capacity.
See the General Court’s judgment: https://aeur.eu/f/sn (Original version in French by Mathieu Bion)