(fra kommisjonsforordningen)

(1) Regulation (EU) 2024/1735 lays down measures to scale up the Union’s manufacturing capacity for net-zero technologies and their key components. Those measures should increase the competitiveness of the net-zero technology sector, attract investments, and improve market access for clean technologies in the Union. Among those rules, Article 26 of Regulation (EU) 2024/1735 supports the aim of developing and maintaining an industrial basis for the deployment of renewable energy technologies to secure the Union’s energy supply and avoid dependencies for the supply of these technologies. To this end, it requires Member States to apply certain non-price criteria to at least 30 % of the volume auctioned per year per Member State or alternatively to at least 6 Gigawatt per year per Member State for the deployment of energy from the renewable sources using the renewable energy technologies listed in Article 4(1), points (a) to (j) of that Regulation (2). Article 26 of Regulation (EU) 2024/1735 introduces the requirement to apply certain non-price criteria as pre-qualification criteria, while for other criteria Member States enjoy flexibility to decide in their auction design whether to apply them as pre-qualification or award criteria or as a combination of both type of criteria. Moreover, in accordance with Article 26(2), last subparagraph of Regulation (EU) 2024/1735, Member States are not precluded from using additional non-price criteria beyond those listed in Article 26(2).

(2) The rules specifying the pre-qualification or award criteria that should be included in auctions to deploy energy from certain renewable sources aim to facilitate the design and application of the criteria laid down in Article 26 of Regulation (EU) 2024/1735 and ensure uniformity across the Union, while providing sufficient flexibility to Member States. Harmonised implementation of the criteria should reduce transaction costs for economic operators and Member States and avoid fragmentation of the internal market in accordance with the principle of Union added value. This should be done while allowing for sufficient flexibility for Member States to adapt their application of the pre-qualification or award criteria to the structure and planning of their respective auction systems, their specific characteristics and other considerations linked to the other public policy objectives, in line with the principle of subsidiarity. The application of these criteria in renewable energy auctions should not undermine the core objectives of the auction in terms of rapid, efficient and sustainable renewable energy deployment and should ensure a competitive bidding process and legal certainty. This Regulation specifies the pre-qualification or award criteria that should be included in auctions to deploy energy from certain renewable source to ensure that these criteria are designed and applied in an objective, transparent and non-discriminatory manner without leading to a disproportionate increase in costs.

(3) The criterion related to responsible business conduct should ensure that activities carried out by companies are aligned with the needs of society and nature. Building on the relevant international standards framework, such as the United Nations’ Guiding Principles on Business and Human Rights: Implementing the United Nations ‘Protect, Respect and Remedy’ Framework, the OECD Guidelines for Multinational Enterprises on Responsible Business Conduct, the OECD Due Diligence Guidance for Responsible Business Conduct, the ILO Tripartite Declaration of Principles concerning Multinational Enterprises and Social Policy (MNE Declaration) and relevant Union legislation on corporate sustainability due diligence (3), in particular Directive (EU) 2024/1760 of the European Parliament and of the Council (4) as well as Directive (EU) 2022/2464 of the European Parliament and of the Council (5) and Commission Delegated Regulation (EU) 2023/2772 (6), the introduction of a pre-qualification criterion on responsible business conduct in renewable energy auctions should go beyond the due diligence requirements in existing Union law by requiring to take action addressing the core elements of due diligence with regard to the general bidder’s business activities related to the auction. Bidders should also be required to publicly communicate on the actions taken to do so. To avoid putting an excessive bureaucratic burden, natural persons, companies that are not in the scope of Directive 2013/34/EU of the European Parliament and of the Council (7) as defined in its Articles 19a and 29a and their subsequent modifications and renewable energy communities should not be required to comply with this additional obligation and are subject to lighter requirements, while being entirely exempted from the application of the responsible business conduct criterion for projects with capacity below 10 MW. However, Member States should maintain the possibility to extend to natural persons, companies that are not in the scope of Directive 2013/34/EU as defined in its Articles 19a and 29a and their subsequent modifications and renewable energy communities the obligation to take action to address the core elements of due diligence for projects with capacity above 10 MW. The assessment of compliance with the responsible business conduct criterion should be based on the core elements of due diligence, as laid down in Annex I to Delegated Regulation (EU) 2023/2772 (8).

(4) Ensuring a high level of cybersecurity and data security in energy generation installations is crucial for maintaining security of energy supply and critical energy infrastructure. Cybersecurity risks in the energy sector may adversely affect the confidentiality of information processed in the construction and operation of renewable energy installations and may impact the ability of the operator to retain operational control of the installation. Renewable energy installations face a large set of potential cybersecurity risks linked to the supply chain, such as severe and unexpected corruption of the supply chain, the unavailability of information and communication technology (ICT) products, services or processes in the supply chain or cyberattacks initiated by actors in the supply chain, including by highly sophisticated and persistent malicious state and criminal actors.

(5) To ensure that all bidders duly address cybersecurity and data security risks, auctions for the deployment of energy from renewable sources should include pre-qualification criteria requiring them to implement cybersecurity risk management measures, reflect them in a cybersecurity plan and ensure those measures are applicable to ICT products or services provided by their suppliers. The storage and processing of data related to the operation of renewable energy installations in jurisdictions outside the European Economic Area can generate threats to the security of the installations and to the overall system. An extra level of data protection is necessary to ensure the security of the installation and of the overall system in cases when the bidder is subject to the jurisdiction of a third country requiring the bidder to report information on software or hardware vulnerabilities to authorities of that third country prior to those vulnerabilities being known to have been exploited. An extra level of data protection is also necessary where, according to a public statement either on behalf of the Union under the framework for a joint EU diplomatic response to malicious cyber activities (9) or on behalf of one or several of its Member States, threat actors operating out of the territory of that third country have carried out malicious cyber activities or campaigns. To that end, Member States should in particular take into account targeted restrictive measures imposed by the Union to deter and respond to cyberattacks which constitute an external threat to the Union or its Member States (10). Public statements on behalf of a Member State are particularly relevant for auctions carried out by that Member State. In such cases bidders should provide a substantiated cybersecurity plan outlining the technical, operational and organisational measures to ensure that data used for or generated in their business activities related to the auction are stored and processed in the European Economic Area (EEA) and not transferred outside the EEA. It is important that an operator established in the EEA maintains operational control of the installation to ensure appropriate oversight and enforcement of EU law with a view to guaranteeing the security of the installation and of the overall system.

(6) The inclusion of criteria to ensure the bidder’s ability to deliver the project are key to ensuring that bidders and their bids are credible, have the necessary technical knowledge, experience and financial and economic capability, and have a realistic business and technical plan to complete the project fully and on time, respecting the different specifications and non-price criteria requirements included in the auction. It is thus appropriate to require bidders to provide specific documentation and evidence. When designing such criteria, Member States should also take into account the project costs, its risks, the project capacity, the maturity of the technology, the degree of innovation required by the auction and other relevant market conditions. This is particularly relevant as imposing excessive requirements, for instance, for smaller projects may limit artificially competition and exclude smaller players that would otherwise be able to participate in the auction. Furthermore, imposing excessive requirements may limit participation in the auction by new entrants. Instead, for larger projects, which involve higher risks, it may be necessary to impose stricter conditions to ensure that the projects can be delivered fully and on time, while still guaranteeing a competitive bidding process.

(7) In accordance with Article 26(1) of Regulation (EU) 2024/1735 Member States must include pre-qualification criteria or award criteria to assess the auction’s sustainability and resilience contribution. Article 25 of Regulation (EU) 2024/1735 requires contracting authorities and contracting entities to apply in certain public procurement procedures minimum mandatory requirements regarding environmental sustainability and certain mandatory requirements to assess the tender’s resilience contribution. Both public procurement procedures and auctions for deploying renewable energy sources contribute to the Union's resilience. Public undertakings operating in the energy sector that are contracting entities in accordance with Article 4 of Directive 2014/25/EU of the European Parliament and of the Council (11) are subject to Article 25 of Regulation (EU) 2024/1735 when procuring net-zero technologies listed in Article 4(1), points (a) to (k), of Regulation (EU) 2024/1735. At the same time, they may also participate as bidders in renewable energy auctions subject to Article 26 of Regulation (EU) 2024/1735. Recital 81 of Regulation (EU) 2024/1735 recalls the importance of ensuring that the sustainability and resilience requirements are applied in a way that ensures fair and equal competition among market players regardless of their ownership structure. In order to ensure such fair and equal competition, for the purposes of assessing resilience and environmental sustainability requirements, public undertakings participating in renewable energy auctions pursuant to Article 26 should be subject only to the rules laid down in Article 26. The rules set out in Article 25 should apply to the procurement of the net-zero technologies, except where such procurement is used to carry out projects awarded in the context of renewable energy auctions subject to Article 26 (12).

(8) The specific choice of type of criteria to assess the auction’s sustainability and resilience contribution (pre-qualification or award criteria) falls within the remit of the relevant authorities designing the specific auction. However, the relevant authorities should ensure that the choice of type of criteria does not undermine the competitive nature of the bidding process and does not unduly slow down the deployment of renewable energy technologies.

(9) The assessment of the auctions’ contribution to resilience should aim to ensure Union access to a secure and sustainable energy supply by (i) reducing current dependencies and avoiding new strategic dependencies on single third countries for the supply of net-zero renewable energy technologies and their main specific components; and (ii) enhancing the Union’s manufacturing capacity of these technologies and components. This should be done without jeopardising the achievement of the binding Union target on renewable energy for 2030 laid down in Article 3(1) of Directive (EU) 2018/2001 of the European Parliament and of the Council (13). When deciding whether to apply resilience as a pre-qualification or award criterion to net-zero technologies or their main specific components, the relevant authorities should take into account the Union’s level of dependency on a third country for that net-zero technology or its main specific component, the availability of alternative sources of supply and the impact that applying resilience as a pre-qualification criterion instead of an award criterion could have on the supply of that main specific component. In cases where resilience is used as an award criterion in auctions, the relevant authorities should aim to increase the diversification of the Union’s supply away from a country on which the Union is excessively dependent by awarding a higher number of points to bidders that ensure higher diversification of their sources of supply compared to bidders meeting the minimum resilience requirements.

(10) To address dependencies of the Union on a single third country supplying more than 50 % of a specific net-zero technology or its components or at least 40 % in certain circumstances, and to promote supply diversification, Member States’ relevant authorities should limit participation to relevant auctions or award points based on requirements linked to the origin of the final product and a certain number of main specific components laid down in Commission Implementing Regulation (EU) 2025/1178 (14) that originate in a third country on which the Union is excessively dependent. Furthermore, it is appropriate to limit the origin of certain key strategic components given their technology value and their central role in security of energy supply and in the supply chain of specific net-zero technologies, but for other main specific components bidders should retain flexibility in choosing which components they intend to source from the third country on which the Union is excessively dependent within the limits set in this Regulation. These requirements provide for a practical and objectively verifiable methodology to assess the resilience of net-zero technologies and their main specific components that are part of an auction. It is appropriate to set the specific requirements for the different technologies and their main specific components taking into account their specific circumstances and characteristics, such as the availability of alternative sources of supply, sufficient manufacturing capacity globally, the level of maturity and deployment rate of the technology, the impact of diversification on supply chains and overall costs. In the case of PV technologies final products (solar photovoltaic systems) and PV modules, non-preferential rules of origin laid down in Commission Delegated Regulation (EU) 2015/2446 (15) provide that the assembly of PV cells (HS 8541 42 ), which are classified in the same tariff heading as PV modules (HS 8541 43 ), or equivalent components into PV modules would not change the origin of the module. For this reason, it is appropriate to refer to the assembly of the solar photovoltaic system and of the PV module, rather than to their origin, as a reference for the contribution to resilience of those specific manufacturing steps.

(11) For certain main specific components the level of dependency on a single third country may be so high that a strict application of the resilience criterion would endanger the security of supply of that component. In such cases it is appropriate that the relevant authorities retain some flexibility to increase the threshold of main specific components which may originate from that third country on which there is excessive dependency.

(12) When carrying out the assessment required in Article 26(8) of Regulation (EU) 2024/1735 on the resilience and sustainability criteria for auctions for the deployment of energy from renewable sources and their effect on the accelerated deployment of renewable energy technologies, the Commission should duly consider the effectiveness of the resilience criterion and whether such effectiveness is undermined by practices aiming at altering the origin or place of assembling of net-zero technologies final products or main specific components.

(13) Member States’ relevant authorities should also assess the resilience contribution of auctions for onshore wind technologies, offshore wind technologies and electrolysers, even in the absence of a single third country supplying more than 50 % of these technologies or their components or at least 40 % in certain circumstances, given that for these technologies there is a significant risk of increased dependency on imports from the People’s Republic of China, which may threaten the Union’s security of supply. This is so given the current and projected global and the Union’s supply and demand trends for these technologies, and the fact that the People’s Republic of China’s production capacity exceeds 50 % of global production (16) and its projected production significantly exceeds its domestic targets and foreseeable demand.

(14) Article 26(2) of Regulation (EU) 2024/1735 indicates that the auction’s sustainability contribution can be assessed by introducing criteria related to environmental sustainability going beyond the minimum requirements in applicable law, innovation or energy system integration.

(15) Regulation (EU) 2024/1735 provides for the inclusion of considerations related to environmental sustainability both in certain public procurement procedures and in certain auctions to deploy renewable energy sources. The Regulation gives the Commission implementing powers to specify minimum requirements related to environmental sustainability for public contracts and to further specify the environmental sustainability criteria that may be used in auctions to deploy renewable energy sources. The former will be laid down in an implementing regulation to be adopted pursuant to Article 25, paragraph 5 of Regulation (EU) 2024/1735, while the latter were established in the present Regulation. The two acts aim to achieve the same goal to increase the environmental sustainability of net-zero technologies and reducing their impact on the environment. However, the approach of the two Regulations and their content differ in order to take into account the different specific legal empowerments, the difference in the procedures pertaining to public procurement and auctions to deploy renewable energy sources, the different scope in terms of net-zero technologies covered and the difference in the type of authorities that are in charge of these different procedures and in the volumes that are deployed through them.

(16) When choosing to set environmental sustainability criteria, the relevant authorities should set criteria assessing impacts on the climate and the environment. When doing so, they should apply one or more of the environmental sustainability criteria set in this Implementing Regulation or other criteria they consider relevant.

(17) The carbon footprint of renewable energy technologies is one of the relevant criteria that Member States’ relevant authorities can introduce in auctions to assess their contribution to environmental sustainability. For this criterion to be objective, transparent and non-discriminatory, the carbon footprint of the net-zero technology should be measured and assessed on a life cycle basis. It is also appropriate to harmonise the methods for assessing life cycle carbon footprints in order to reduce margins for assumptions and improve the comparability of results, which is necessary to enable an effective contribution to environmental sustainability. Further harmonisation in this area is expected as part of the Clean Industrial Deal (17).When Union law provides a method for assessing the carbon footprint of a given net-zero technology, Member States should use it in their national auctions for the deployment of energy from renewable sources using that technology.

(18) In the absence of Union law providing a specific method or a method indicating that it is suitable to be used as a proxy for assessing the carbon footprint of a given renewable energy technology, in order to improve the comparability of results when using carbon footprint as a criterion in auctions, it is necessary to further specify design parameters for that criterion, notably in terms of methodology and quality requirements of data.

(19) Transitioning to a circular economy is a key element of the European Green Deal, as set out in the circular economy action plan (18).

(20) Auctions for net-zero technologies can contribute to this transition by setting pre-qualification criteria or award criteria related to circularity. If authorities decide to do so, they should set criteria on recyclability, ease of repair and maintenance or ease of upgrading, reuse, remanufacturing and refurbishment of products, or on the use or content of recycled materials, including critical raw materials, referring to one or more relevant product parameters set out in Annex I to Regulation (EU) 2024/1781 of the European Parliament and of the Council (19).

(21) Biodiversity loss and ecosystem collapse are among the biggest threats facing humanity. The Union has put in place legal frameworks, strategies and action plans to protect nature and restore habitats and species, such as the Biodiversity Strategy for 2030 (20) and Regulation (EU) 2024/1991 of the European Parliament and of the Council (21). Climate breakdown induces the loss of biodiversity globally and biodiversity loss aggravates climate change, they are thus inextricably linked, as recent studies have confirmed. Biodiversity and healthy ecosystems are fundamental to climate-resilient development.

(22) Net-zero technologies can have negative and positive impacts on biodiversity. It is appropriate to design criteria in auctions that help maintain the diversity of species, ecosystems and their reproductive capacity. Negative impacts are mostly local and can include habitat loss or deterioration as well as disturbance of species, including through noise and collisions. Positive impacts can include climate change mitigation, reductions in air pollution and landscape interventions that benefit wildlife. Pre-qualification or award criteria, or both, that address biodiversity impact have the potential to promote synergies between net-zero technologies and biodiversity. Transparent monitoring of the impact of projects on biodiversity should be done throughout the lifetime of a project and adaptive measures be taken where necessary.

(23) Where the relevant authorities include the biodiversity impact of net-zero technologies as an award criterion, the criterion should require net-positive contributions to biodiversity. Examples of measures that address net-positive contributions to biodiversity could include restoration or re-establishment of habitats, measures to improve the habitats of species and increase their populations or measures to reduce pressure from other activities on the environment. Rewarding net-positive contributions to biodiversity beyond offsetting measures ensures a level-playing field among competing bidders whose projects have divergent impacts and provides an incentive to avoid or minimize negative impacts.

(24) Energy efficiency is crucial for the achievement of the Union’s ambitious goals for the reduction of greenhouse gas emissions by at least 55 % by 2030 compared to 1990, as set out in the Fit for 55 package. In addition, energy efficiency also constitutes a key factor in decreasing energy prices and improving the resilience of the Union’s supply of energy, thereby enabling both a just and safe green transition.

(25) Auctions can contribute towards energy efficiency by including, at the stage of assessment of the sustainability contribution, pre-qualification or award criteria that identify the products whose energy efficiency will be assessed and, for each product, the applicable assessment methodology. The criteria should be set, where applicable, in accordance with Article 7(2) of Regulation (EU) 2017/1369 of the European Parliament and of the Council (22) or the energy efficiency benchmarks specified in the implementing measures adopted under Directive 2009/125/EC of the European Parliament and of the Council (23).

(26) Sustainable water management is important for the Union’s resilience, and structural mismanagement of water has resulted in the degradation and pollution of this finite resource and of water-related ecosystems. Directive 2000/60/EC of the European Parliament and of the Council (24) established an integrated model for water quality management, and the Union’s water policy aims to provide Europeans with access to good quality and sufficient water, guarantee the good status of all water bodies across Europe as well as secure sufficient, balanced and equitable water availability for all water using sectors, including industry. Some net-zero technologies have an impact on water during their use phase by using water or discharging waste water into water bodies. It may therefore be relevant to design water-related non-price environmental sustainability criteria in auctions for such technologies.

(27) The reduction of pollution is another key element of the European Green Deal, as set out in the Zero Pollution Action Plan. The plan sets out the target of reducing air, water and soil pollution to levels no longer considered harmful to health and natural ecosystems and that respect the boundaries our planet can cope with. Auctions for net-zero technologies can help reduce pollutants by setting pre-qualification criteria or award criteria on pollution levels. If the relevant authorities decide to use such criteria, relevant methodologies, thresholds and compliance mechanisms should be defined in accordance with and based on Union law, where available, and taking into account as applicable the criteria laid down in Appendix C to Commission Delegated Regulation (EU) 2023/2486 (25).

(28) Innovation is key to competitiveness, economic growth and the fast deployment of renewable energy. Directive (EU) 2018/2001 seeks to promote innovation in renewable energy deployment by setting an indicative target for innovative renewable energy technology of at least 5 % of newly installed renewable energy capacity by 2030. The integration of innovation criteria into auction design should promote the development of entirely new solutions or the improvement of solutions that go beyond the state-of-the-art. This will create a robust framework that drives the adoption of cutting-edge technologies, ensuring a sustainable and competitive path towards climate neutrality.

(29) When using innovation as a pre-qualification or award criterion in auctions, it is appropriate to distinguish between two types of auctions. First, the most common types of auctions are those that do not specifically focus on innovation as the main driver for the auction, but whose main objective is the deployment of renewable energy sources. While these auctions do not aim to promote innovation per se, certain elements that reward innovation can be added in the auction design as award or pre-qualification criteria. A second smaller subset of auctions can be referred to as pure innovation auctions, whose main objective is the promotion of innovation linked to the future deployment of renewable energy sources, such as wave, tidal energy projects or kite-borne wind turbine projects.

(30) In both types of auctions where innovation is included as pre-qualification or award criterion, the relevant authorities should always assess the candidate projects contribution to a minimum level of improvement in key performance indicators to ensure that the project delivers solutions, technologies or improvements that go beyond the state of the art already available on the market and relative to the subject of the auction. The choice of the key performance indicators against which innovation will be compared to state-of-the-art solutions and technologies depends on the public policy objective pursued by Member States. This can include, for example, key performance indicators measuring improvements in the energy generation efficiency of the technology, recyclability, flexibility of the solution or technology to promote energy system integration, lower dependency on raw materials, longevity of the technology, lower environmental impact or other key performance indicators depending on the specific public objective pursued by the inclusion of the innovation non-price criterion.

(31) In pure innovation auctions, the introduction of pre-qualification criteria to assess innovation should also take into account the maturity of the proposed solutions or technologies in order to guarantee that the candidate project meets the tender objectives and the proposed innovations are not at such an early stage of development that they will not materialise. For auctions that do not focus specifically on innovation, the relevant authorities should also be allowed to require a certain level of maturity of the bidding projects in order to avoid receiving offers at very early stages of development that are unlikely to fulfil the objectives of the auction.

(32) Knowledge dissemination of the latest innovative developments is essential to further spur innovation, in particular for pure innovation auctions (26). Member States’ relevant authorities should include as a pre-qualification or award criteria the need to disseminate the results of the winning project through conferences, publication, open access repositories or free/open-source software and, whenever relevant, operational data, provided adequate confidentiality measures are put in place. Similarly, they should require the winning bid to commit to, on a timely basis, making available licences for research results of aided research and development projects, which are protected by intellectual property rights, at a market price and on a non-exclusive and non-discriminatory basis for use by interested parties in the EEA. For auctions that do not focus specifically on innovation, Member States’ relevant authorities should be allowed to include as pre-qualification or award criteria this type of knowledge dissemination requirements.

(33) With the introduction of new variable renewable energy installations, the electricity system faces specific challenges such as the need to address grid congestion issues while maintaining grid stability. These needs are typically addressed through redispatching and other solutions that entail a cost for the system. The introduction of energy system integration as a non-price criterion in renewable energy auctions can alleviate these system costs by addressing the impact on the system of operating the renewable energy project. Nevertheless, energy system needs cannot be addressed only through non-price criteria in renewable energy auctions and require systemic solutions, including network planning, regulatory aspects, market signals or network tariffs.

(34) Non-price criteria for energy system integration should be designed in a way that allows all technologies and solutions that can help address the identified system needs to participate. If duly justified on the basis of the identified system needs or allowed in Union law, auctions should also focus on one or more technologies or solutions. These technologies or solutions could be included in the investments envisaged in the bidding project or sourced through a contract with a third party as long as they constitute a new investment. This possibility will allow bidders to select the most cost-effective solutions. Assessing the contribution to a system need of different technologies and solutions may require modelling tools that allow authorities to estimate the impact on the energy system of scenarios with and without the bidding project in an objective and non-discriminatory manner. Alternative approaches could focus either on objective and verifiable variables that serve as proxies for general system needs or as proxies for the contribution of specific technologies, taking into account in particular network planning. However, these alternative approaches run the risk of underestimating the potential impact of the candidate project on the system.

(35) When including energy system integration as a criterion in their auction design, the relevant authorities should take into account the contribution of bidding projects to addressing system needs, based on the following three key parameters: the contribution of bidding projects to electricity system needs from a temporal perspective; their contribution to establishing connections across energy carriers; and their contribution to electricity system needs from a locational perspective.

(36) Where the contribution of bidding projects to addressing electricity system needs from a temporal perspective is assessed, the wide range of solutions, including energy storage and demand response, that can contribute to address imbalances created by variations in renewable generation and electricity demand should be taken into account. In the framework of auctions for the deployment of energy from renewable sources, the use of assets that allow modulating generation, grid feed-in or consumption of the bidding projects contributes to addressing system needs by providing temporal flexibility. This can be achieved for instance through the combination of several renewable generation technologies, the combination of generation assets and electricity storage assets or the combination of generation assets and demand assets or solutions that can increase or reduce electricity demand when required.

(37) Where the contribution of the bidding project to establishing connections across energy carriers is assessed, the capacity to transfer renewable energy from one energy carrier to another through energy conversion assets should be taken into account. Connections across energy carriers refer in particular to the conversion of renewable electricity into a different energy carrier, such as heat or hydrogen, for consumption in a demand sector that does not directly consume electricity. In this way, the gradual decarbonisation of the electricity system to which the bidding project contributes can enable the decarbonisation of demand sectors that do not use electricity, such as heat in some residential or industrial buildings or hydrogen in some industrial processes. Connections across energy carriers therefore contribute to the energy system’s needs for achieving decarbonisation when it is the most cost-efficient pathway. In addition, energy conversion assets that establish these connections across energy carriers, such as electrolysers or heat generation and storage facilities, also help address temporal flexibility needs in the electricity sector.

(38) Where the bidding project’s contribution to electricity system needs from a locational perspective is assessed, the focus should be on the interaction between grid topology and the location of generation and consumption assets, which can lead to grid congestion issues and lower use of renewable energy. An optimal location of new renewable energy generation projects and of the grid connection point can therefore help alleviate grid congestion issues and is of crucial importance for electricity system needs. Auctions can therefore limit participation to projects located in predefined areas where they can help reduce grid congestion or attribute points to bidding projects on the basis of their locational impact.

(39) To ensure the effectiveness of the criteria specified in this Regulation in renewable energy auctions, Member States’ relevant authorities should lay down a methodology for assessing the non-price criteria specified in this Regulation, introduce appropriate monitoring mechanisms and guarantees to ensure compliance with such criteria and appropriate penalties in case of non-compliance. These guarantees and penalties should be set at a level that balances the need to ensure competitive bidding while dissuading companies from bidding without a firm intention of realising the project and meeting the project specifications. The level of guarantees and penalties should be designed in such a way that it will be more costly for the bidders not to meet the auction specifications than to bear the cost and meet them.

(40) For some criteria, it may be necessary to demonstrate compliance throughout the lifetime of the project, for instance the contribution to energy system integration, cybersecurity or environmental sustainability may require permanent monitoring. It is appropriate to introduce harmonised rules on the timing of the verification of such compliance. All bidders in an auction should commit themselves to complying with all auction requirements and specifications included in their offer when they submit their bid. Demonstration of actual compliance with the requirements resulting from the different non-price criteria and other auction requirements can take place at different points in time, which should be defined by Member States’ relevant authorities where relevant.

(41) Bidders should provide specific documentation to prove compliance with certain non-price criteria. To prove compliance with the pre-qualification criteria on responsible business conduct in auctions for renewable energy sources, Member States’ relevant authorities should require third-party assured statements on due diligence. To demonstrate effective implementation of cybersecurity risk management measures, the bidder should submit a cybersecurity plan and update it on a regular basis. Where relevant, authorities may require bidders and their suppliers to undergo regular security audits carried out by independent third parties and present the results of these audits on a regular basis.

(42) This Regulation is without prejudice to Article 4 of Directive (EU) 2018/2001 and Articles 107 and 108 Treaty on the Functioning of the European Union, and to the Union’s international obligations. Member States’ relevant authorities should introduce pre-qualification or award criteria in auctions for the deployment of energy from renewable sources in accordance with the Union’s international obligations and in compliance with the relevant requirement for the imposition of restrictive measures on grounds of security and public order. Such criteria should also comply with and not go beyond Union law and be consistent with commitments made under trade and investment agreements to which the Union or Member States are parties and trade and investment arrangements to which the Union or Member State adhere.

(43) The measures provided for in this Regulation are in accordance with the opinion of the Energy Union Committee,