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TSC Modifications Panel Meeting Dec 2017

Contingent Capital. TSC Modifications Panel Meeting Dec 2017. Confidential For discussion only. Key Objectives. Why is contingent capital needed? How much contingent capital is required in I-SEM? What happens if contingent capital is exhausted?. Option 1. Option 2. Option 3.

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TSC Modifications Panel Meeting Dec 2017

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  1. Contingent Capital TSC Modifications Panel Meeting Dec 2017 Confidential For discussion only

  2. Key Objectives • Why is contingent capital needed? • How much contingent capital is required in I-SEM? • What happens if contingent capital is exhausted? Option 1 Option 2 Option 3 Confidential For discussion only

  3. Why is contingent capital needed EirGrid/SONI Market Charges Market Payments Capacity Constraints Residual Error Interconnector Ramping Market Operator Charges ….. Confidential For discussion only

  4. Why is contingent capital needed EirGrid/SONI Market Payments Market Charges MWhr based Forecast Errors Time based Market Charges Market Payments Confidential For discussion only

  5. Why is contingent capital needed EirGrid/SONI Accumulated Charges-Payment Contingent Capital Market Payments Market Charges

  6. Change in key assumptions – SEM v I-SEM Confidential For discussion only

  7. Will Contingent Capital be exhausted? • Put prudent amount in place • Some remedial actions • Warning System • Uplift in tariffs at short notice • Change to Market Rules • Low risk , but could happen • What happens if contingent capital is exhausted? Confidential For discussion only

  8. What happens if contingent capital is exhausted? • Currently payments must continue to be made under TSC • Condition precedent for raising finance that some mechanism be put in place • Costs will be recovered over time – just not sufficient funds to pay • Risk of breach of TSC and legal action • Proposal is that payments are suspended and accrued until charges exceed payments

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