Transmission and Distribution of Electricity

NACE Macro-Sector: D - Electricity, gas, steam and air conditioning supply

Level 2: D35

Level 3: D35.1

Level 4: D35.1.2 D35.1.3

Construction and operation of transmission Systems that transport the electricity on the extra high-voltage and high-voltage interconnected System. Construction and operation of distribution Systems that transport electricity on high-voltage, medium-voltage and low-voltage distribution Systems. Construction and operation of interconnections that transport electricity between separate Systems.

Climate Change Mitigation

Metric and threshold:

All electricity transmission and distribution infrastructure or equipment in Systems which are on a trajectory to full decarbonisation are eligible, except for infrastructure that:

• Is dedicated to creating a direct connection, or expanding an existing direct connection between a power production plant that is more CO2 intensive than 100 gCO2e/kWh, measured on a LCE basis, and a substation or network.

A System is deemed to be on a trajectory to full decarbonisation if either more than 67% of newly connected generation capacity in the System is below the generation threshold value of 100 gCO2e/kWh measured on a PCF basis, over a rolling five-year period; or the average System grid emissions factor is below the threshold value of 100 gCO2e/kWh measured on a PCF basis, over a rolling five-year average period. These criteria will be subject to regular review, in line with reviews of generation threshold values and progress to decarbonisation. Based on the results of an assessment carried out in 2019 by the EU JRC, the interconnected European System meets the criteria above that define a system to be on a trajectory to full decarbonisation. It, and its subordinated systems, meet the eligibility criteria for this activity and are derogated from carrying out the quantitative assessment. This derogation will also be subject to regular review, in line with review of the criteria above, or in case of major policy changes that would negatively affect commitments to decarbonisation.

The following T&D grid related activities are eligible, irrespective of whether the system is on a pathway to full decarbonisation:

• Direct connection, or expansion of existing direct connection, of low carbon electricity generation below the threshold of 100 gCO2e/kWh declining to 0g CO2e/kWh in 2050, measured on a PCF basis, to a substation or network.
• EV charging stations and supporting electric infrastructure for the electrification of transport, subject to taxonomy eligibility under the transport section.
• Installation of T&D transformers that comply with the Tier 2 (2021) requirements from Regulation 548/2014 on the eco-design of small, medium and large power transformers and, for medium power transformers with highest voltage for equipment not exceeding 36 kV, with AAA0 level requirements on no-load losses set out in standard EN 50588-1.
• Equipment and infrastructure where the main objective is an increase of the generation or use of renewable electricity generation.
• Equipment to increase the controllability and observability of the electricity system and enable the development and integration of renewable energy sources, this includes: o Sensors and measurement tools (including meteorological sensors for forecasting renewable production) o Communication and control (including advanced software and control rooms, automation of substations or feeders, and voltage control capabilities to adapt to more decentralised renewable infeed).
• Equipment to carry information to users for remotely acting on consumption.
• Equipment to allow for exchange of renewable electricity between users.
• Interconnectors between transmission systems are eligible, provided that one of the systems is eligible.

Definitions and Notes: 

• A System is defined as the transmission or distribution network control area of the network or system operator(s) where the activity takes place. 
• The European System shall be defined as the interconnected electricity system covering the interconnected control areas of EU Member States, Norway, Switzerland and the United Kingdom.
• The annual average System grid emissions factor is calculated as the total annual emissions from power generation, divided by the total annual net electricity production in that system.
• The rolling five-year (average) period used in determining compliance with the thresholds shall be based on historic data, and shall be include the year for which the most recent data is available. 
• Transmission Systems may include generation capacity connected to subordinated Distribution Systems.
• Distribution Systems subordinated to a Transmission System that is deemed to be on a trajectory to full decarbonisation may also be deemed to be on a trajectory to full decarbonisation.
• To determine eligibility, it is possible to consider a System covering multiple control areas which are interconnected and with significant energy exchanges between them. In such a case, the weighted average emissions factor across all included control areas is used to determine eligibility, and individual subordinated transmission or distribution systems within this System will not be required to demonstrate compliance separately.
• It is possible for a System to become ineligible after having previously been eligible. In Systems that become ineligible, no new T&D activities are eligible from that moment onward, until the system is again in compliance with the threshold (except for those activities which are always eligible, see above). Activities in subordinated Systems may still be eligible, if these subordinated Systems meet the criteria of this Taxonomy.
• A direct connection or expansion of an existing direct connection to production plants includes infrastructure that is indispensable to carry the associated electricity from the power generating facility to a substation or network.

Climate Change Adaptation

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