Transcript Folie 1

Monitoring Report
Capacity Allocation and
Congestion Management
Walter Boltz, Chairman ERGEG Gas Working Group
19th Madrid Forum
21 March 2011
Starting point
• DG Competition’s energy sector inquiry report sets out some of the
problems in accessing gas transmission capacity
• It highlights contractual congestion and presents evidence of this occurring
on a number of key pipelines;
• Access to capacity is key to the development of a competitive
European gas market and facilitation of cross-border gas trade;
• Mechanisms applied today have not been successful in facilitating a
functioning capacity market;
• Two antitrust-settlements by DG Competition against incumbents show
that long-term capacity booking which prevents access of competitors to
infrastructure needed to supply gas to customers can be considered as
abuse of a dominant market position.
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Experiences with existing measures
Art. 5 and 8 Regulation (EC) 1775/2005
• 3 Surveys
• NRAs 2008;
• NRAs 2009;
• TSOs and NRAs 2010 – 21 selected IPs representing a broad majority of EU
capacities.
• Crossing borders is often difficult for shippers
• Capacity fully booked in the long-term mostly by incumbents;
• Different legal frameworks appear to be an obstacle;
• Lack of cooperation between TSOs in capacity calculation.
• Inconsistencies hamper TPA
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Different allocation mechanisms: FCFS, pro-rata, auctions;
Short term capacity products exist in most (western) countries;
Different designs for interruptible capacity;
Different nomination procedures;
Implementation of congestion management procedures insufficient.
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Physical congestion
Source: ERGEG 2010 monitoring
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Contractual congestion
Source: ERGEG 2010 monitoring
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FCFS predominately used
Source: ERGEG 2010 monitoring
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Applied CMPs
Source: ERGEG 2010 monitoring
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Harmonisation of procedures
is limited
Source: ERGEG 2010 monitoring
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CMP – Problem identification
• All capacity is booked long-term at most IPs but often not
fully used;
• Currently, in many countries there are no mechanisms to
bring unused capacity back to the market;
• Market participants ask for firm capacity;
• The more shippers book the existing capacity the more
severe the impact of contractual congestion will be;
• Secondary markets do not work properly.
Capacity should link markets and not result in a
barrier to market integration
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Macro Economic Effects of CMP
Bunde / Bocholtz
 Maximum aggregate technical
capacity between market
areas GTS (The Netherlands)
and NCG-H (Germany) is
higher than actual flows for
most days of the years
(contractual congestions)
Welfare gain in TEUR p.d.
500
400
300
200
100
0
-150
-100
-50
to The Netherlands
0
50
Additional gas flows in GWh / d
100
150
to Germany
remaining price difference
Maximum price difference
5
in €/MWh
Price difference [EUR / MWh]:
D A
Price difference
EEX - TTF
6
4
initial price difference
3
average price difference
2
Remaining price difference after
elimination of contractual congestions (option 2)
1
Additional capacity in million kWh p.d.
0
-1
1
-2
21
41
61
Maximum price
81
Higher day ahead price
difference
in The Netherlands
-3
-4
days p. a.
 Implementation of ERGEG
principles (option 2) will
increase gross social welfare
by more than 10 Mio EUR p.
a. while additional investments
to increase physical capacities
seem to have minor impact (<
2 Mio. EUR gross benefit p.
a.)
101
 Prices between markets will
converge on more than 340
days p. a.
Source: E-Bridge
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Conclusions
• Applied CMPs differ widely throughout Europe
• Physical compared to contractual congestion seems to be a
smaller problem;
• For ~ 50% of the surveyed IPs the EASEE-gas CBPs for nomination
procedures are not used;
• Maximisation of available capacities is done via investment by about
2/3 of the TSOs
• Measures which increase the efficient use of existing capacity
are only applied by a minor number of TSOs;
• Little information is available on how the reservation for short term
capacity products is achieved.
Harmonised CMPs are essential for
well functioning gas markets.
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Recommendations
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A wider use of long-term UIOLI procedures appears as a
reasonable possibility to reduce the problems linked to congestion
for users;
Further possibilities include the surrender of booked capacity and
making available more firm day-ahead capacity;
Harmonisation at both sides of IPs would decrease shipper’s
transaction costs
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Only for less than 1/4 of the selected IPs this could be affirmed at the
moment;
There is further need for harmonisation and for common definitions.
Common CMPs should aim at maximising technical and
available capacities on a firm basis.
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Thank you for your attention!
www.energy-regulators.eu
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