EC with Guidance on Anticipatory Investments

The European Commission published on 2 June 2025 its guidance on anticipatory investments for developing future electricity networks. The document is aimed at Member States, national regulatory authorities, as well as transmission and distribution system operators, with the goal of creating appropriate conditions for grid investments that reflect future needs, while ensuring energy affordability for consumers and maintaining the competitiveness of industry.

Summary of the Guidance on Anticipatory Investments

What are Anticipatory Investments?

Anticipatory investments are investments into grid infrastructure assets that proactively address network development needs beyond those corresponding to reinforcements related to currently existing grid connection requests by generation or demand projects. They are forward-looking network investments based on identified medium- and long-term network needs, justified in network development plans, based on scenarios that project plausible trajectories of generation and demand capacities that support energy, climate, and industrial policies, including the National Energy and Climate Plans (NECPs).

Key Recommendations

1. Network Planning

Develop stable national medium and long-term energy and climate policy goals, strategies, and plans, well aligned with NECPs, to facilitate network development scenarios.
Ensure network development plans are based on scenarios of future development, with coordination at the national level and with the TYNDP (Ten-Year Network Development Plan).
Ensure stakeholder involvement already at the scenario development phase.

2. Regulatory Scrutiny

Introduce adequate forward-looking periods for detailed network planning or investment plans of system operators, to factor in and approve anticipatory investments.
Ensure regulatory scrutiny on network development plans facilitates the assessment and inclusion of anticipatory investments, ensuring they are based on appropriate scenarios and there is a clear link between the plans and the approval of investments.

3. Costs and Incentives

Introduce definitions and upfront cost-approval and rate of return rules for anticipatory investments, including risk management schemes, to allow for investor certainty.
Consider a two-step cost approval process for accelerating grid projects while minimizing risk and costs: 1. design and permitting, 2. construction.
Design connection charges to facilitate the connection of future users of the grid and optimal grid use.
Introduce clear rules on connection requests, setting maximum periods for connection and related penalties, to avoid underutilization of the related asset.
Ensure that once assets are approved, their remuneration is not retroactively questioned, for instance, based on initially low utilization rates.
Consider strategies to limit the impact on tariffs through state guarantees or the use of public budgets to lower network charges covering additional costs resulting from measures to accelerate decarbonization and market integration, including for anticipatory investments.