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CMP First draft principles for an operational implementation of surrender of capacities

CMP First draft principles for an operational implementation of surrender of capacities. GRI South – Stakeholders meeting 27 September 2012. Annexe to REG715 on Congestion management procedures in the event of contractual congestion (CMP).

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CMP First draft principles for an operational implementation of surrender of capacities

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  1. CMPFirst draft principles for an operational implementation of surrender of capacities GRI South – Stakeholders meeting 27 September 2012

  2. Annexe to REG715 on Congestion management procedures in the event of contractual congestion (CMP) • 4 measures are to put in place to manage contractual congestions (in the absence of physical congestion) • Scope • Interconnection points between adjacent entry-exit systems inside EU • But also to entry points from and exit points to third countries, subject to the decision of the relevant national regulatory authority Oversubscription & buy-back (oct. 2013) UIOLI Day-Ahead (July 2016) Restitution de capacité (oct. 2013) UIOLI Long Term (oct. 2013)

  3. Main principles on Surrender of contracted capacity • TSO shall accept any surrender of firm capacity which is contracted by the network user at an interconnection point, with the exception of capacity products with a duration of a day and shorter • The network user shall retain its rights and obligations under the capacity contract until the capacity is re-allocated by the TSO and to the extent the capacity is not re-allocated by the TSO • Surrendered capacity shall be considered to be reallocated only after all the available primary capacity has been allocated • Deadline for implementation: 1st October 2013

  4. Implementation of Surrender • Proposition of a gradual implementation of this mechanism • 1st step: Surrender will be limited to products with a duration of Y+1 and Quarters. These products will then be reallocated only through products with a duration of Quarters and Months • Implementation in October 2013 (under condition of a previous validation by CRE and stakeholders via “Concertation Gas”) • 2nd step: Surrender will be enlarged to other products • Implementation will be studied after CAM implementation • Justification of this gradual implementation • Strong impact of surrender of capacities on IT systems, in particular for the reallocation under day-ahead products • Need to take into account CAM calendar

  5. Constraints of CAM Calendar to surrender capacities • 1st step: • Need to define a minimum “pre avis” to surrender capacities Slots to surrender annual and quaterly products

  6. Sell of surrendered capacities • 1st step: Possible surrendering One or more Quarters* Yearly Product (N+1) One or more Months * If submitted before the start of the Quarterly auctions

  7. Sell of surrendered capacities • 1st step: Possible surrendering One Quarter* Quarterly Product One, two or three Months * If submitted before the start of the Quarterly auctions

  8. Propositions for implementation of surrender capacities • Management of non reallocated products: • - Shippers will continue to nominate as far as surrendered capacities are not reallocated • Remark: this point will be of crucial importance when surrendered capacities will be reallocated (in the 2nd step) until day-ahead products • Management of several surrendered capacities for the same product: • - Use of a « time stamp » per maturity for the surrendering (capacities surrendered the first will be reallocated the first) • Remark: stakeholders are the first concerned regarding the choice to make • A capacity surrendered is definitely surrendered

  9. Price principle • The surrendering of capacities must not conduct to strategic behaviour that distort the well functioning of the market, in particular in the context of a difference between the initial price paid and the final price of the capacity surrendered • If the initial price is superior, the shipper that surrenders the capacity must pay the difference (for the concerned period) to the TSO • If the initial price is inferior, the shipper that surrenders the capacity must not keep the difference • There must be a financial neutrality principle

  10. Next steps • Further explore this mechanism as well as oversubscription/buy-back mechanism • Share these principles with adjacent TSOs, NRAs and stakeholders

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