1. Vision for the internal electricity market
Matti Supponen
Unit B2
“Internal Market II: Wholesale markets; Electricity & Gas”
European day-ahead and intra-day pilot projects
1st NWE Stakeholder Workshop 9 December 2011

2. Contents Drivers of the European electricity market
European electricity market target model
Infrastructure package
Issues

3. Drivers in energy policy regarding electricity
Decarbonisation
Renewables targets
Security of supply
Competitiveness

4. Renewables in energy mix
The EU policy by 2020
100%
-20%
-20%
+20%
8,5%
Greenhouse gas levels
Energy consumption
Renewables in energy mix

5. Roadmap 2050

6. Surplus and deficit areas (2008)
TWh
Surplus 40 25 20 15
TWh
Deficit 20 80 5 15 40 25 25 25
TWh
Storage
Hydro 50 25 25 20 20 45 10 10 50
TWh
Wind 30 30 30 10 35 25 25 15 10 10 25 10 10 20

7. Correlation Wind Energy Production ↔ Control Program DE
Trendline
+ Export
- Import
Source: Amprion GmbH
h-Values, 2010 7 7
Wind Energy Production - Effects on the Market | 2010 | © Amprion

8. Infrastructure

9. Overlay network? ~ ~ ~ ~ ~ ~ ~ ~ ~ Overlay network Transmission
Virtuelle Erzeugung
Virtuelle Last
Transmission
380/220kV
Distribution
110kV ~
Distribution ~ ~ ~ ~ )*
Source: Klaus Kleinekorte in VDE DACH 2010 conference

10. European infrastructures priorities by 2020 for electricity
Baltic energy market inter- connection plan
Interconnections in South West Europe
Interconnections in Central-South East Europe
Offshore grid in the Northern Seas and connection to Northern and Central Europe
Electricity
highways
Smart grids in the EU

11. Energy & Climate Objectives National / regional TYNDP with PCIs
EU infrastructure priorities
TYNDP and CBA (electricity: 2014, gas: 2015) 
Overview of the process of identification of projects of common interest
Regional Groups to propose regional PCI lists
Approval by concerned Member States
Energy & Climate Objectives
ACER opinion
Commission decision on Union-wide PCI list
By 30 July 2013
National / regional TYNDP with PCIs

12. Measures to facilitate the implementation of projects of common interest
A new method to identify and select concrete projects of common interest (PCIs) necessary to implement the priority corridors
Shortening and streamlining permit granting procedures and improving public involvement
Removing regulatory obstacles for investments in infrastructures of European relevance
Providing appropriate direct support and financial support for projects of common interest

13. Market design Forward markets based on spot markets
Cross-border trade optimisation based on day ahead market coupling
Long term cross border trade with financial products
Further cross-border trade optimisation through allowing intra-day trade with the remaining capacity
Final optimisation through a pan European balancing system

14. Congestion management 1998
Congestion management 1998
Implicit auctions
Only explicit auctions
Other methods
Nord Pool

15. Congestion management 2000
Congestion management 2000
Implicit auctions
Only explicit auctions
Other methods
Nord Pool
Arnhem auction
office

16. Congestion management 2010
Congestion management 2010
Implicit auctions
Only explicit auctions
Other methods
Nord Pool
APX
EMCC
CASC
CAO

17. Congestion management 2014?
Congestion management 2014?
Implicit auctions
Only explicit auctions
Other methods
Euro Pool

19. European electricity day ahead spot market
European electricity day ahead spot market
Liquid (>30% spot trade/consumption)
Some liquidity (15%< <30%)
Little liquidity (5%<<15%
No liquidity (<5%)
Nord Pool (74%)
LITPX
APX
(NL 21% UK 4%)
POLPX
OTE (~5%)
HUPX
BELPEX (12%)
EPEX
(DE/AT 23%
FR 11%
CH 13%)
OPCOM (9%)
EXAA (4%)
OMEL (83%)
IPEX (69%)
Hellenic Pool (~100%)
South Pool (0%)
Volumes from 2008 data

20. Matti’s price zones for Europe20

21. Matti’s price references for Europe
Northern Electricity Price Index
NEPI
Wind Electricity Price Index
WEPI
Central Electricity Price Index
ČEPI
Iberian Electricity Price Index
IEPI
Southern Electricity Price Index
SEPI 21

22. Issues Heretic local market designs Governance of market coupling
Relations between power exchanges
Calculation of cross-border capacity
Price zones
Loop flows
Sharing of congestion rents
Flow based methods
Who will build and pay new infrastructure?

23. Loop flows Physical flow +++ Surplus Commercial flow 1000 MW ---
Deficit

24. Loop flows Physical flow +++ Surplus Commercial flow 1000 MW ---
Deficit

25. Loop flows 25

26. Looking forward to the discussion