1. 35th IG meeting 16th February 2016
Enagás, GRTgaz, REN and TIGF
35th IG meeting
16th February 2016

2. II. CMP: common methodology of OSBB in the Region

3. II.1 TSOs reviewed proposal and responses to the NRAs questions.

4. 1. Question number 1
The justification of the need to restrict renominations when the buy-back procedure is launched. Specific examples would be necessary to fully understand the proposal on this issue.
On the Spanish side, the circular 1/2013 sets in the Art. 6 (4) that once the buyback procedure is launched, the renominations of the network users will be blocked upwards. This avoid the TSO to buy back even more capacity once the buy back is launched.
The TSOs considered necessary to block them downwards too because if the network user is able to change its nomination downwards there is a potential risk for the TSO to pay for a capacity that would be finally not necessary.
The most clear example of not restricting a renomination is that a shipper could trigger the buy-back by pushing high its renomination after having booked additional capacity, then offering capacity at higher price whatever the BB procedure (CFO or reverse auction), and renominating lower afterwards.
We do see that the measure introduces rigidity, but we consider that this rigidity is essential to avoid a shipper arbitrage and for the TSO not to buy-back a volume which is higher than actually needed and incur in unnecessary costs for all. In any case, any solution shall eliminate the risk for the TSO to pay for a capacity that would be, at the end, not necessary.

5. 1. Question number 1
Should the renomination rights not be restricted, an alternative could be envisaged whereby shippers who renominate downwards would not be paid for the possible premium they would have received for selling capacity through the BB mechanism.
This procedure would on the one hand discourage the network users from gaming and would also compensate TSOs and the system for inefficient incurred costs that were finally not needed.

6. 1. Question number 2
More clarification of the pro-rata mechanism when the buy-back procedure does not fulfil TSOs needs (users and capacities affected), providing examples of their application.
What is foreseen in each Member State’s Regulation:
On the French side, the rule is the following (extracted directly from CRE’s deliberation dated 27/06/2013): the TSO will buy-back from each shipper holding firm capacities on the concerned point, firm capacities on the pro-rata of the booked firm capacities, after interruption of the interruptible capacities at the concerned IPs.
On the Spanish side, the circular 1/2013 sets in the Art. 6 (4) that in the case that network users are not offering enough capacity to cover the capacity that has to be bought back, the TSO will use a pro-rata mechanism between the users who hold firm capacity.
On the Portuguese side, the Manual de Procedimentos de Acesso às Infraestruturas, setting the rules for CMP, states that remaining capacity that is not bought back through the BB auction shall be reduced from shippers who have nominated or renominated gas for that day in proportion to their nominations. Those shippers will be paid the daily reference price.

7. 1. Question number 2
How do we see the application in all 3 Member States:
Pro-rata will apply to every network user who nominated his booked capacity. The pro-rata rule will apply to those network users, even when their “proposal to sell” was taken into account, once those capacities have been reduced and therefore TSOs bought back some of their nominated capacity.
TSOs will reduce firm bundled and unbundled capacities. When a pro-rata rule is applied, this shall be based on the valid nominations of each network user for that period.
In the case a pro-rata is applied, TSO shall pay network users for the pro-rated capacity the daily reference price which is applicable at the reference gas day.

8. 1. Question number 2 Example of application of a pro-rata mechanism:
Technical firm capacity of 165 fully booked, no interruptible capacity and 15 of additional capacity marketed through oversubscription. 12 out of 15 have been booked and nominated. No other technical or commercial measure possible to reduce this shortage of capacity. A market-based Buy-Back procedure has been triggered and 7 out of 12 have been bought-back by the TSO.
There is consequently 5 more to buy-back through pro-rata rule.
Let’s assume 5 shippers that have booked and nominated.
Shipper
Booked and nominated
Sold back to TSO (through BB process)
Renominated
Pro-rata
(based on renominations)
Final nomination A 90 -4 86
-2,529
83,471 B 40 -2 38
-1,118
36,882 C 5
-0,147
4,853 D 17 -1 16
-0,471
15,529 E 25
-0,735
24,265
177 -7
170 -5
165

9. 1. Question number 3
Estimation of the expected use and results of the buy-back procedure, taking into account precedent measures to be applied (interruptible capacity, OBA, etc.) and analyzing the convenience of its implementation (cost, IT changes required, etc.) as “call for orders” versus “reverse auctions”.
Taking into account risk management in calculating additional capacity + the OBA and interruptible, the estimation of having a BB procedure triggered is very low at both VIPs. But, if happening, it is impossible to know the exact day (labor day, bank holidays…) and the procedure must be solved in 30 minutes.
Taking into consideration what was mentioned above, the procedure should be applied automatically, no matter if reverse auction or call for orders is used. IT costs will be incurred anyway.
PRISMA has been working on possible adaptations to current mechanisms as they appear at PRISMA platform and gave us an estimation on part of the costs and implementation time for each of the mechanisms (addition to the annual fee). We are reviewing the pros and cons of both procedures before taking a final decision. In addition, PRISMA still has to send us some more information in order to get a full understanding of every implementing option.

10. Latest developments and next steps in the Region
Interoperability NC.
Latest developments and next steps in the Region

11. 1. Implementation of the INT NC
Latest developments:
Nomination, re-nomination and matching procedures (according to the BAL NC and INT NC) are already implemented.
Data exchange:
An Integrated Data Exchange solution (HTTP/S-SOAP, has been implemented for the TSO-TSO communication.
For the TSO-Network User communication, both an Integrated Data Exchange solution and an Interactive Data Exchange solution are already offered in the majority of the cases.
Reference temperature (capacity and nominations) already in place for IPs
Ongoing developments:
Bilateral discussions to review (if needed) the Interconnection Agreements according to the content of NC,
Short term monitoring on gas quality: data publication (Wobbe-index and gross calorific value) – Trying to harmonise the publication as much as possible

12. Status of PCIs in the Region
IV. Infrastructures.
Status of PCIs in the Region

13. IV.1 Update of the second list of PCIs in the Region
Infrastructures submitted to the TYNDP 2015
CS Chopy
Obergailbach
GRTgaz
(TRAN-N-047)
CS Evy
CS Voisines-Morelmaison
CS Voisines
VAL DE SAONE GRTgaz
(TRA-N-043)
ARC LYONNAIS
(TRAN-N-253)
Gascogne-Midi
TIGF
(TRAN-N-331)
Gascogne Midi
GRTgaz
(TRAN-N-391)
3rd IP
REN 1st Phase
(TRAN-N-283)
MidCat
TIGF
(TRAN-N-252)
ERIDAN
(TRAN-F-041)
Lupiac-Barran
Gascogne-Midi
CS Montpellier
3rd IP
REN 2nd Phase
(TRAN-N-284)
Celorico-Spanish border
Zamora-Portuguese border
CS Saint-Martin de Crau
Loop Castelnou-Villar de Arnedo
CS Zamora
Spanish border-Barbaira
CS Cantanhede
3rd IP
Enagás
(TRAN-N-168)(*)
Figueras-French border
MidCat
GRTgaz
(TRAN-N-256)
Cantanhede-Mangualde
Hostalrich-Figueras
CS Martorell
3rd IP
REN 3rd Phase
(TRAN-N-285)
Loop Tivisa-Arbós
MidCat
Enagás
(TRAN-N-161)
(*) Additionally core network reinforcements are needed in the Spanish system

14. IV.1 Update of the second list of PCIs in the Region
On the 14th of July 2015 the INEA/CE approved a CEF Grants for Studies for REN (Portuguese part of the infrastructure):
For the Studies: Engineering studies (basic and detailed design) and Envirionmental Impact Study (EIS) of the 3rd Interconnection point PT-SP project;
Amount of the Grant (for Studies): €.
The Grant Agreement was signed between INEA and REN on 29th of October 2015, and REN received a pre-financing payment of € in the beginning of November.
On the 12th of February (last Friday), REN started the permitting process by submitting to the National Authorities (DGEG), the first part of the studies granted.
CEF GRANTS

15. IV.1 Update of the second list of PCIs in the Region
The 19th January 2016 the European Commission approved a CEF Grant for Studies, for both Enagás and TIGF
Enagas
For the Study: Engineering studies of MidCat project
Quantity of the Grand (for Studies): €,
TIGF
For the Study: Conceptual and FEED studies (French part of the MidCat project)
Quantity of the Grant (for Studies): €
As the press release of the European Commission said:
“Funding will also be allocated to studies on the MidCat project which will help eliminate infrastructure bottlenecks between the Iberian Peninsula and France, and connect gas supplies from Algeria and Spanish LNG terminals with the rest of Europe”
CEF GRANTS

16. IV.1 Update of the second list of PCIs in the Region
The Commission Delegated Regulation 2016/89 of 18th November amending Regulation 347/2013 was published in the Official Journal of the European Union the 27th January 2016.

17. IV.1 Update of the second list of PCIs in the Region
27th January 2016: meeting of the High Level Group
The aims of the meeting were:
To agree on the Implementation Plan for MidCat and 3rd IP project
The Commission has opened a two week window for comments.
The implementation Plan is being discussed at HLG level.
To show the final results of the study: "Costs and benefits of improving the gas interconnection of the Iberian Peninsula with the rest of Europe“,
Developed by Ramboll
The Commission has opened a two week window for comments
High Level Group

18. Thank you for your attention!