Presentation on theme: "FUI Electricity region: Update on Congestion management CRE SG Meeting - 3 December 2008."— Presentation transcript:
FUI Electricity region: Update on Congestion management CRE SG Meeting - 3 December 2008
Background on Regulators’ objectives Compliance with the European regulation (Regulation 1228/2003, CM Guidelines) Regulators are confident: (implementation of firm nominations stage, netting, UIOSI, infra, etc.) Harmonisation with the rest of Europe Some concerns regarding the intraday reassignments (i.e. bilateral transfers within the intraday timeframe) and firmness of programmes
Intraday reassignments Why such IT developments? Very far from the target mechanism (implicit, obligatory use and continuous) No consensus from Stakeholders High probability that Stakeholders will not use this service Costs of development? operational cost? What is the added-value of this service?
Firmness of programmes (1/2) ERGEG published a very clear Position Paper (July 2008) “In the context of explicit auctions, firmness of capacity rights ensures a clear contractual element for market players by defining risks and costs associated with cross-border trade. This is especially important for traders on either side of a border who have no physical generation and thus have to rely on wholesale markets to balance their positions.” “Firmness is an important prerequisite for market coupling to develop.” Absence of firmness induces a risk premium for market actors. This is an “extra cost to the system that can restrain the development of cross-border trade, effective competition and, more generally, the efficient functioning of the market to the detriment of end-consumers. Firmness promotes market integration and fosters competition on both sides of the congested interconnection, thus benefiting end-consumers.
RTE: NGIL licence as a limitation NGIL: ERGEG position not applicable on IFA due to technical specificities (DC cable) Firmness of programmes is in place on a majority of interconnections (except in CEE and FUI regions) Firmness of programmes is in place on DC cables (Kontek and Norned) Firmness is a pure financial issue (who should bear the risk?) Regulators are working to make the ERGEG’s position applied on FUI interconnections before the go-live of CMS Firmness of programmes (2/2)
Next steps Regulators’ common position on firmness of programmes in January 2009 TSOs to submit new allocation rules in January Public consultation by written procedure during one month Formal rules approval by CRE Come into force of the new IFA rules in the summer 2009