1 Madrid, 2 nd Nov 2011 17 th IG Meeting South Gas Regional Initiative.
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Transcript of 1 Madrid, 2 nd Nov 2011 17 th IG Meeting South Gas Regional Initiative.
1
Madrid, 2nd Nov 2011
17th IG Meeting
South Gas Regional Initiative
2
17th IG meeting SGRI- Agenda
I. Opening
I.1 Welcome
I.2 Approval of the agenda and minutes from the last meeting (for approval)
II. Development of ENTSOG first draft of CAM Network Code (for information by TSOs)
III. Capacity Allocation Mechanism harmonisation
III.1 Comments sent by Stakeholders (for information by Regulators)
III.2 Progress on the CAM harmonization at Portugal-Spain interconnections (for
information by TSOs)
IV. Congestion Management Procedures harmonisation
IV.1 Comments sent by Stakeholders (for information by Regulators)
IV.2 CMP Comitology guidelines (for information by Regulators and for discussion)
V. First draft of the regional investment plan (for information by TSOs)
VI. MIBGAS:
VI.1 Proposal to achieve an integrated market (for information by Regulators)
VI.2 Update of the ERSE-CNE study on cross border tariffs between Portugal and
Spain (for information by Regulators)
VII. AOB and next meetings
3
II. Development of ENTSO-G first draft of CAM
Network Code
(Information by TSOs)
4
III. Capacity Allocation Mechanisms
harmonization
5
III.1 Comments sent by Stakeholders
• Two responses received commenting on the design of the Spanish-
Portuguese auction
• Main comments are:
Participants:
The requirement for shippers to be registered in both countries where the
capacity at the interconnection point is auctioned should be removed (one agent)
At least, affiliate companies should be considered the same shipper (one agent)
Product definition:
Annual products required to assure the possibility to book flat capacity during 12
consecutive months (two agents)
Balance of capacity assigned to different products: other products should be
allocated in this coordinated process, like day ahead, interruptible and backhaul
(one agent)
Bundled and unbundled products should coexist (one agent)
6
III.1 Comments sent by Stakeholders
• Main comments are (cont.):
Capacity offered:
Incentives required for TSOs to assure they offer the maximum capacity and to
promote investments (one agent)
An analysis of how to maximize the capacity offered and on the possibility of
single virtual point is needed (one agent)
Allocation methodology:
The CAM should ensure a flat allocation alongside different interconnection
points, in order to incentivise gas flow around Europe (one agent)
Multiple round algorithm for long term products is suggested, similar to the
Spanish one used for allocation of underground storages capacity (one agent)
Reserve price:
Reserve price equal or lower than the regulated tariff (one agent)
For very short term capacity (day-ahead or within day), reserved price zero or
lower than the regulated tariff (one agent)
7
III.1 Comments sent by Stakeholders
• Main comments are (cont.):
Binding window (TSOs’ proposal is 5 days):
The TSOs’ proposal allows shippers not to participate the first 4 days of the
binding window. In this case, aggregated information on the bids provided at
the end of these days will not be reliable. An alternative proposal is to have
rounds with firm offers from the beginning. (Two agents)
Volume-based cleared-price auction:
While one agent agree with this mechanism, since it is considered to better
maximize the allocation of capacity and minimize the number of bids where
pro rata is applied, the other is against this mechanism, because the pro rata
may allocate capacity that it is impossible for the shipper to use and because
the maximization of capacity may involve no more capacity for others auctions
or products
8
III.1 Comments sent by Stakeholders
• Main comments are (cont.):
Other comments:
CMP and CAM should be developed in parallel, because CAM effectiveness
would be limited by contractual congestions (one agent)
There’s a need for keeping coherence with allocation processes applied in the
OS between Spain and France: timing, period offered, time products, etc. (one
agent)
It would be interesting to keep coordination between allocation in the different
interconnection points within the SGRI in the future (one agent)
Coordination between TSOs is considered essential (single point of contact,
single nomination, coordinated data exchange, coordinated capacity
calculation, etc.) (one agent)
Coherence between gas products and electricity market schedules is required
(one agent)
9
(Information by TSOs)
Area of work Responsible
Starting
Deadline
CAM harmonisation proposal (CAM pilot testing Sp‐Pt borders)
TSOs Jan. 2011 Jan. 2012
III.2 Progress on the CAM harmonization at Portugal-Spain interconnections
10
IV. Congestion Management Procedures
harmonization
11
IV.1 Comments sent by Stakeholders
• One response received on the proposal for CMP harmonization
between France and Spain
• Main comments are: CMP and CAM should be developed in parallel, because CAM effectiveness would
be limited by contractual congestions
Interconnection points between Spain and Portugal should also be considered in
the proposal
CMP should be specific for every capacity product, the same CMP for short and
long term capacity shouldn’t be appropriate
TSOs should develop a coordinated secondary capacity market, which would
promote the application of UIOSI mechanism
Ex ante mechanisms, like oversubscription or interruptible capacity, are required in
order to maximize the capacity offered in the short and mid term
TSOs should develop a common, clear and transparent UIOLI mechanism for long
term capacity
12
DR
AF
T• Scope:
All interconnection points regardless of whether they are currently
congested or not
• Mandatory:
Overselling and buy-back firm capacity before 1 January 2013:
TSOs must propose the scheme and NRAs will approve it
The mechanisms will be based on statistical scenarios and structured as
revenue and cost-sharing scheme between TSOs and users
If there is a potential congestion, buy-back mechanism will be market-based
NRAs (in consultation with TSOs) may set minimum overselling volume
TSOs to inform NRAs regularly on the functioning of the system
IV.2 CMP Comitology Guidelines (amending Regulation 715/2009)
13
DR
AF
T
IV.2 CMP Comitology Guidelines (amending Regulation 715/2009)
• Optional:
Firm day ahead UIOLI,
Mandatory since 1 July 2016 if ACER monitoring report shows that in 2015
contractual congestion has occurred in the allocation of products with a duration
of one month or longer
Based on renomination rights restrictions:
o Firm renominations upwards allowed up to 50% of the fraction of the initially
not nominated capacity. The remaining capacity can be nominated on
interruptible basis
o Renominations downwards allowed down to 50% of the initial nominations
o If initial nomination is over 90% of the booked capacity, renominations
downwards are not allowed
14
DR
AF
T
IV.2 CMP Comitology Guidelines (amending Regulation 715/2009)
• Other mechanisms:
Surrender of booked capacity mechanism:
When contractual congestion exists, TSO is obliged to accept
surrendered capacity
TSOs to define conditions for user to surrender totally or partially their booked
capacity to TSOs
NRAs to approve the mechanisms
Long term UIOLI:
Capacity holders will lose their capacity if:
o Capacity is requested but it’s not available in the primary market
o Primary holder has not offered unused capacity in the secondary market
o Primary holder uses less than 80% of its contracted capacity for more
than 12 consecutive months without justification or during a winter month
15
IV.2 CMP Comitology Guidelines (amending Regulation 715/2009)
APPROVAL PROCEDURE: UPDATE
• Impact assessment and draft document presented in the
last Madrid Forum
• The Forum invited EC to start the comitology process
• Informal meeting between EC and representatives of the
Member States on the 14th October, countries were given
10 days for written comments
16
V. First draft of the Regional Investment Plan
(Information by TSOs)
17
VI. MIBGAS
18
VI.1 Proposal to achieve an integrated market
COMMENTS SENT BY STAKEHOLDERS
• Two stakeholders sent comments proposing a plan to foster MIBGAS
Agent 1 proposal:
The existence of different regulations hampers the functioning of MIBGAS:
In the short term, the proposal is to analyse measures which foster the access to
interconnection capacities and LNG terminals, and to design a common balancing
mechanism, integrating historical transit capacities:
o The same CMP for the entire interconnection capacity
o To carry out the CAM pilot project
o To revise the tariff methodology in Spain
o To compare Spanish regulated tariff and historical transit costs
o To align balancing flexibility and imbalances charges
o To remove the minimum volume requirement to access the regulated exchanges
mechanism in the Portuguese LNG terminal
In the mid term it would be necessary to analyze the integration model
19
VI.1 Proposal to achieve an integrated market
COMMENTS SENT BY STAKEHOLDERS
Agent 2 proposal:
SHORT TERM
With regard to pancaking:
o To finalize NRAs’ study on cross border tariffs; afterwards NRAs to propose harmonized tariff
o TSOs to analyze administrative pancaking and to simplify the access to interconnection
infrastructures
CMP and CAM to be developed at the same time, since CAM’s effectiveness is limited by contractual
congestion
With regard to interconnection capacity between Spain and Portugal, the agent proposes:
o To establish a coordinated and transparent capacity calculation methodology
o TSOs to improve coordination in order to increase the capacity and its utilization: single
communication point and process, single nomination, single data format and standard procedures
to sort out operational constrains
o To consider one single virtual point (Tuy + Badajoz) in capacity allocation processes
o TSOs to define and develop the following mechanisms: Overselling and buy back, interruptible
capacity, backhaul capacity and secondary market
20
VI.1 Proposal to achieve an integrated market
Agent 2 proposal (cont.):
SHORT TERM
NRAs, with Stakeholders’ cooperation, to identify asap in which cases to create
national wholesale market areas is possible, and to define where more than one
Member State are required when achieving a well functioning wholesale market
MID TERM
Definition of common balancing rules and penalizations
Development of a coordinated, cost reflective and transparent access tariffs for
all infrastructures
21
VI.2 Update of ERSE-CNE study on cross border tariffs between Portugal and Spain
22
VII. AOB and next meetings
23
VII. AOB and next business
AOB:
• Spanish hub operator (presentation by Enagas)
• Transparency compliance ( follow North Region plan)
Next meetings:
• ACER asking for a six month agenda
• Next SG meeting with Ministries, ACER and EC representatives
24
Conclusions:
• On CAM harmonization ERSE and CNE will give feed back to TSOs on the
way forward and will propose the implementation to both Governments
• On the CMP pilot project, doubts on the way forward are shown,
considering the current draft of EC CMP comitology guidelines:
mandatory/voluntary oversubscription, ways of surrender the capacity,
opportunity to continue with the harmonization of UIOLI long term
between France and Spain. Risk and cost should be taken into
consideration. Since the cost of UIOLI long term is low, the SGRI will
follow working as planned. A precise proposal for the next steps will be
made by TSOs.
• On the GRIP, TSOs will share with the SGRI the investment plan for
comments of regulators and stakeholders. In the next IG meeting the plan
will be presented and discussed.
Conclusions
25
Conclusions:
• On tariffs harmonisation in Spain and Portugal, after the
finalisation of the study, it will be sent previously to TSOs
for comments to be provided in a week, and then
submitted to public consultation
• On transparency, regulators will submit questionnaires to
check compliance with Regulation, following North Region
example
• Regarding next meeting agenda, regulators will send asap
a proposal
Conclusions