Transcript EU CAM Network Code and CMP Guideline Proposal Update

European Developments
Transmission Workgroup
2nd February 2012
EU CAM Network Code and CMP Guideline Proposal
Update
Transmission Workgroup
2nd February 2012
Content
 ENTSOG Capacity Allocation Mechanism (CAM) Network Code
Update
 Introduction
 High Level Principles
 Timescales
 Congestion Management Procedures Guidelines (CMP) Update
 Introduction
 High Level Principles
 Timescales
Introduction
 ENTSOG CAM Development Progress
 Following on from December’s Workstream update regarding the reconsultation on the CAM Code and Stakeholder responses
 ENTSOG have amended the Code in-line with Stakeholder feedback
 Moves away from GB Entry regime (as was originally proposed in the
draft Code)
 Both CAM and CMP relate to IP points only within the European Union
 Timelines described later in presentation
Summary of Responses (from Dec
Workstream update)
Products
Start date
Algorithm
Limit price
steps
Quarterly
14
1st Jan
5
Multiple
28
Unlimited
35
Yearly
24
1st Oct
29
Single
6
Limited
1
No
preference
0
No
preference
4
No
preference
4
No
preference
2
Minimise
unsold
Default
Rule
Auction
Premium
Split
Minimise
9
Max
12
Proportional
13
Draft NC
24
Partial
5
Equal
9
No
preference
5
No
preference
21
No
preference
16
Full consultation responses available at:
http://www.entsog.eu/publications/index_g_cam.html
(CAM) - High Level Principles
 Principles of Co-operation
 Standardisation of communication - Included an agreed approach to
communication procedures within NC. The Code would commit TSOs
to working together to develop agreed communication procedures
 Gas Year - 1st Oct
 Allocation of firm capacity
 Capacity reservation – at least 10% of technical capacity to be
released for shorter duration products* subject to ACER clarity on definition
– Yearly (15yrs), then quarterly (for
Year 1), monthly (month ahead), Daily (Day ahead) and Within Day.
 Standard Capacity products
(CAM) - High Level Principles
 Allocation of firm capacity (cont)
 Within-day capacity allocation - Sell within-day firm capacity via auctions
and (due to the Guideline text) a potential to nominate interruptible capacity
within-day via a non-auction method (although needs to be the same method
either side of the IP)
 Auction algorithm
 Longer duration products - Multiple round ascending clock - greater
perceived simplicity, lower vulnerability to strategic bidding (since price
discovery measures are embedded in the design) and ability to adjust bids or
step out of an auction in response to the progress of auctions at other IPs
 Number of price steps in a volume based auction - Unlimited number of
price steps, included is a time limit to avoid an overlap with the next relevant
auction
 Minimisation of unsold capacity - Small price steps. Approach reduces
unsold capacity while avoiding pro rata
 Short Term Products – Day Ahead & Within Day – Uniform price
(CAM) - High Level Principles
 Cross-border contracted capacity
 Mandatory bundling - Partially unbundled default rule approach
 Under this approach, the capacity to be bundled after
implementation of the default rule would be determined by the
lower of the aggregated bookings on either side of the IP
 Non-matching capacity would remain unbundled and would be
split proportionally amongst network users
 Sunset Clause
 Now included in final CAM Code to satisfy CAM Guideline
 Forces Users to agree amongst themselves the capacity held (as
a bundle) either side of the IP point
 Max timeline 5 yrs (after Code comes into force)
(CAM) - High Level Principles
 Tariffs
 Revenue Equivalence - Introduces a non-arbitrary and reasoned
approach to setting the tariffs for different product duration
 Allows system users to procure capacity according to their
identified needs by minimising any undue incentive to book
capacity before such a need is identified
 Avoids cross-subsidies between network users – Users who
require highly variable gas flows, the levels of which are only
known shortly before the actual gas flow, will be able to match
capacity bookings to their requirements by building a highly
variable product profile
(CAM) - High Level Principles
 Booking Platforms – The Code includes next steps and timings
 Sets out Next steps in the process to achieving a single EU platform
 No later than 1 year after the Code comes into force, ENTSOG shall
publish a report describing the number and operation of existing and
planned booking platforms
 Based on this report – a market consultation process to identify the
market’s needs with respect to booking platforms; which shall last at
most 12 months and shall end with the publication of a comprehensive
report setting out the market’s requirements for booking platforms by
ENTSOG
 The report will also provide an assessment of costs and time needed to
reduce the number of platforms or to eventually establish an EU-wide
booking platform meeting the market’s requirements. A corresponding
action plan towards a single EU wide booking platform, and a timetable
for its implementation shall be part of this report.
 Interaction with CMP Guidelines?
 ACER tasked Frontier Economics to review ENTSOG CAM
auction design
CAM Timescales
Activity
By when
ENTSOG Finalise Network Code
19/01/12
Internal Governance Approval
26/01/12
Stakeholder Workshop – Brussels
31/01/12
(CAM Launch)
Stakeholder Support Process (2 weeks)
Ends 13/02/12
ENTSOG Board Approval
06/03/12
Deliver Network Code to ACER
09/03/12
Capacity Allocation Mechanisms (CAM)
- Potential Timescales
ACER
Review
NC
3 mths?
Amend Codes
9 mths
Comitology
12 mths?
June
2012
Network Code
Provided to
ACER
09/03/12
System
Implementation [18mths?]
June
2013
Mar
2014
Sept
2015
2016
Introduction
 ENTSOG CMP Update
 Continued to influence the
Commission on the content and
impacts of the Guideline Proposal
 Held discussions in particular on
the direct impacts to the CAM
Code
 European TSOs lobbying relevant
Ministries in preparation for the
Comitology process
 Commission issued Impact
Analysis documents mid Jan 12
CMP – High Level Principles
 Capacity increase via oversubscription and buy-back
 Provides TSO’s with an incentive to make additional amounts of Firm
Capacity available over and above the technical capacity
 Additional amount above technical capacity to be offered ‘upfront’
in an auction
 The technical capacity is to be allocated before any
oversubscribed incentive based capacity
 Joint Regulator & TSOs to co-operate to develop best practices
 Incentive schemes needed within and across member states IPs
CMP – High Level Principles
 Firm Day-ahead use-it-or-lose-it mechanism
 Restriction of re-nomination rights (w.e.f 1st July 2016) subject to
Regulator decision at IP
 Surrender of booked capacity
 Users can surrender capacity at any time to the TSO
 Obligations remain until reallocated
 Unsold capacity to be sold before surrendered capacity
CMP – High Level Principles
 Long Term use-it-or-lose-it mechanism
 Removes current firm contractual rights where Users do not
utilise the capacity over a defined period
 Information provision
 Data is to be made available on one central platform
 Interaction with CAM?
CMP Guidelines
 The Commission published the latest version of the Draft
Guidelines – 19th December 2011
 GB Stakeholder meeting held with DECC 13th January 2012
 Written views provided to DECC
 The first Comitology meeting for Member States held 26th January
2012
Congestion Management Procedures
(CMP)
- Potential Timescales
Agree CMP regime
with relevant NRA(s) by
/ Implementation
by 1st July 2013?
Comitology Starts
26th January 2012
2012
2013
Comitology lasts for ???
July
2014
EU Tariffs Update
Transmission Workgroup
2nd February 2012
ENTSOG response to ACER Tariff
Scoping consultation
 ACER is expected to issue a Tariff Scoping consultation – January
2012
 Responses are invited by [x] March 2012
 Following response analysis by ACER the Commission will
decide whether ACER will be invited to write the Framework
Guideline or use the Comitology guideline route.
Potential tariff codification process(es)
FG drafting by ACER,
2 month formal consultation, COM scrutinizes FG
6 months overall until
and invites ENTSOG
submission to COM
Invitation
letter
ACER Consultation
on FG scope
March
Response analysis
by ACER
Commission
decides whether to
invite ACER to write FG
or go COM guideline route
Summer
2012
Timeline is very indicative
Alternative
or
cumulative
September
Commission drafts
guidelines and sends them
directly to comitology
February 2013
ENTSOG runs
12 month
Network code
process
Interoperability Update
Transmission Workgroup
2nd February 2012
Interoperability Framework
Guideline
 We now expect ACER’s consultation on the Framework
Guideline to be published in March
 This is to allow the regulators more time:
 To complete ‘problem identification analysis’ – i.e. what
are the genuine technical barriers
 To take further views from the Interoperability Expert
Group (meeting scheduled this month in Ljubljana)
 To finalise their thinking on the scope
 National Grid NTS will continue to argue that the scope
should be limited to interconnectors, not all entry / exit
points
ENTSOG TYNDP 2013-2022 – Stakeholder Joint
Working Sessions
TYNDP 2013-2022: Stakeholder
Joint Working Sessions
 The Ten Year Network Development Plan (TYNDP)
2013-2022 will be the 3rd edition of the non-binding
Union-wide plan of infrastructure development and will
build on the past experience and feedback received.
 Based on ENTSOG best practices a series of
Stakeholder Joint Working Sessions have been set-up
on the following topics:
Infrastructure
Demand
Supply
Market Integration
Security of Supply
TYNDP 2013-2022: Stakeholder
Joint Working Sessions
 The first of the TYNDP SJWS took place on 24th
January.
 The morning session was focused on the ‘Infrastructure’
topic. The methodology used in the previous TYNDP
and the feedback received from stakeholders was
discussed.
 The afternoon session covered both ‘Supply and
Demand’, and again an overview of the process and
methodology used in the previous TYNDP was
discussed. Stakeholders then outlined some potential
improvements.
TYNDP 2013-2022: Stakeholder
Joint Working Sessions
 ENTSOG will take away high level proposals from stakeholders
and at the next SJSW on these topics come back with a solid
proposal, encompassing the key points from the discussion
 The next SJWS is going to be on Wednesday 15th February in
Brussels
 The topics covered will be Market Integration, Security of Supply
and an overview of the ENTSOG Network Modelling Tool
 As always the SJWS are open to all stakeholders who wish to take
part
 ENTSOG maintains a register and will pro-actively notify those on
the register about developments in this and other areas of
ENTSOG’s work. Please write to [email protected] if you want to be
included in this e-mailing list.
EU Updates Timetable
 Timetable aims to highlight the key items (consultations,
workshops, decisions, etc.) National Grid NTS expect to cover
via this agenda item in the forthcoming months
Topic
TX Workgroup
•
March 2012
•
Gas Regional Investment Plan (GRIP) Consultation
Feedback.
Winter Outlook update
•
•
Balancing update
Interoperability update
April 2012