1. WG FBA Status Report Andrzej Detkiewicz IG, 30 ty January 2008

2. 2 Content  BC approach – long term test evaluation  MF approach – structure and allocation model  Current concept status  Critical issues for the concept finalisation

3. 3  Organizational work flow of the BC approach seems feasible after executed test. What we do not know at this point whether the process is efficient and provides reliable results  Multiple scenarios are possible for long term allocation  Received results proved necessity for consistent approach for daily and long term allocation  Processes should be highly automated  Based on test experiences, it is necessary to implement a strict procedure to describe possible updating of the models made by individual TSOs BC approach – long term test evaluation (1)

4. 4  CGM, high BFRM and FRM were found interdependent and very important from the purpose of:  ABC values  Transparency  Discrimination  If individual TSO may define some technical parameters during the calculation process it may lead to the discrimination of other TSOs working in one market  The methodology and the criteria of setting the margins should be defined precisely and commonly agreed BC approach – long term test evaluation (2)

5. 5 BC model structure review Flow gate BC+ [MW] BC- [MW] PTDF [%] ABABACACADAD ABAB ACAC BCBC CDCD C D A1 A2 A3 A4 A6 A5 B1 B2 B3 B4 B5 C1 C2 C3 D1 D2

6. 6 MF approach - model structure (1) critical branch critical outage MF+ [MW] MF- [MW] PTDF [%] ABABACACADAD A1  B1A1  A2 A2  A6 A6  B2 B3  C2B3  B5 B5  C2 B4  C1 C2  D1D1  D2 C3  D2 C1  C3 C1  C2C2  D1 C3  D2 C1  C3 D A1 A2 A3 A4 A6 A5 B1 B2 B3 B4 B5 C1 C2 C3 D1 D2

7. 7 MF approach - capacity allocation model (2)  Common features of capacity models for flow-based allocation  Transmission rights are transformed to flows (by PTDF factors)  Allocation is restricted by flows (not by amount of exchange)  Amount of transmission rights between two areas is result of the allocation DifferencesBorder Capacity (BC)Maximum Flow (MF) Constraints Allocation is constrained by the flow on tie lines, aggregated per border Allocation is constrained by the flow on individual lines/transformers Structure Two constraints per border (one per direction) Two constraints per critical branch and topology Consideration of network security Most critical outage topology for each border is estimated at time of capacity calculation. Details very specific for individual TSO. All potentially critical outage topologies are contained in the model. Most critical one is determined at time of allocation. transmission rights

8. 8 Current Concept status (1)  MF methodology is accepted as preferred solution for implementation in the CEE region (having the advantages over other available flow based methods)  high accuracy of results  easy to be formalized  transparency in terms of technical limits identification  less dependent on the CEE market behavior forecast

9. 9 Current concept status (2) The following decission were made:  Start the IT preparation process (by PM) based on so far developed Concept taking into account:  small risk of unsuccessful feasibility tests and lack of decisions/agreements  limited time available  Accept further co-operation with CONSENTEC in the Concept development and testing

10. 10 Critical issues for the Concept finalisation  Market structure in CEE region  Level of centralization  Data access and transparency – limitation in data availability from certain TSOs necessary in the capacity calculation process  Curtailment principles

11. 11 Market structure in CEE region (1)  The existing situation on power exchange scheduling among German TSOs and between German TSOs and part of Austrians TSOs and among Austrians TSOs, will be not controlled by proposed capacity allocation mechanism and may strongly influence the result of capacity allocation in CEE region.  Effectiveness of power flows control by inclusion of power exchange between Austria and Germany into capacity allocation is only given if existing other bypass routes via TSOs not participating in CEE are included in this mechanism.

12. 12 Market structure in CEE region (2)

13. 13 The regional FBCA can’t solve the problem of uncertain flows in CEE region driven by internal (e.g.: Eon – APG, VE-T – Eon) and external non controllable power exchanges but anyhow evaluation of these flows should be made. Market structure in CEE region (3)

14. 14 Level of centralization  Centralized solution for CGM preparation and AMF, PTDF calculation  Full access of TSOs to the AO technical data (input and results ones)

15. 15 Curtailment principles Considered curtailment options:  Reducing of nominated capacity reservations after daily nomination process and before daily allocation process  Curtailing of already allocated (Y/M) capacity before starting daily nomination process  Buying back already allocated (Y/M) capacity by affected TSOs or AO before starting daily nomination process

16. 16 Thank you for your attention