1 ELECTRIC POWER POOLS ………more slides

2 DEVELOPMENT OF NORDPOOL 1996

3 NORD POOL

4 NORDPOOL Spot turnover in 2003: 32% of total consumption in Norway, Sweden, Finland and Denmark.

5 NORD POOL: FACTS NORD POOL WAS THE FIRST POWER EXCHANGE IN THE WORLD, AND SO FAR THE ONLY POWER EXCHANGE TO TRADE ACROSS BORDERS THE SYSTEM PRICE (SPOT PRICE), WHICH IS FIXED FOR EVERY HOUR, EVERYDAY AT NORD POOL, IS ONLY 1 OF THE 3 ELEMENTS IN THE END-USER PRICE FOR POWER. (IN ADDITION NET TARIFF AND TAXES) NORD POOL IS AN EXCHANGE FOR PROFESSIONAL CUSTOMERS (MARKET PLACE FOR WHOLESALE TRADE IN POWER) VALUE OF TRADED AND CLEARED VOLUME THROUGH NORD POOL 2003: NOK 405 BILLION (EURO 55 BILLION) THE COMMON NORDIC POWER MARKET IS THE MOST LIQUID MARKET FOR POWER IN THE WORLD FACTS - ABOUT THE NORDIC POWER MARKET

6 NORDPOOL : FACTS DenmarkFinlandNorwaySweden Area, 1000 km Population, mill. 5,45,24,58,9 GDP per capita, USD Installed capacity, MW Generation, GWh Electricity consumption per capita, kWh

7 NORD POOL:MARKET PHYSICAL MARKET AUCTION: PRICED WHERE HOURLY SUPPLY AND DEMAND CURVES CROSS, WITH CONSTRAINT COSTS INCLUDED ADJUSTMENT MARKET CONTINUOUS, WITH CONSTRAINT COSTS INCLUDED (FINLAND AND SWEDEN) BALANCE SERVICE RUN BY TRANSMISSION SYSTEM OPERATORS (TSOS)

8 WHAT DOES CLEARING BY NORD POOL MEAN TO MARKET PLAYERS? NORD POOL ACTS AS THE CONTRACTUAL COUNTERPARTY IN ALL TRADES NORD POOL GUARANTEES ALL FINANCIAL SETTLEMENT, AS WELL AS PHYSICAL DELIVERY IN THE ELSPOT POWER MARKET

9

10 EUROPEAN,SOUTH AFRICAN,NORWAY MODEL GGG DDD T + SO G D G D This model is followed in UK by NGC, in Norway by Statenett, in Sweden by Svenska Kraftnet, in Finland by Fingrid, in Netherland by Tennet, in Denmark by Eltral/Elkrafts and in South Africa by Eskom.

11 MALAYSIAN AND KOREAN MODELS GGG This model is followed in Korea by KEPCO and in Malaysia by TNB. These entities are now in the process of separating the distribution function from Transmission & SO functions. T + SO D +

12 JAPAN PRELIMINARY SEARCH REVEALS JAPAN HAS PROPOSED A NEUTRAL SYSTEM ORGANIZATION (NSO) PRELIMINARY SEARCH REVEALS JAPAN HAS PROPOSED A NEUTRAL SYSTEM ORGANIZATION (NSO) NSO RUNS POWER EXCHANGE, GIVES ATCs ETC NSO RUNS POWER EXCHANGE, GIVES ATCs ETC UNIQUE EXPERIMENT UNIQUE EXPERIMENT VERTICALLY INTEGRATED PRIVATE UTILITIES VERTICALLY INTEGRATED PRIVATE UTILITIES RESTRUCTURING IS IN PROGRESS RESTRUCTURING IS IN PROGRESS

13 JAPAN MODEL G T D G T D NSO

14 LINK TO MORE MODELS SIR, PL OPEN IN LAPTOP C:\KOLKATTA\POWER POOLS AND ISO.PPT