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Balancing workstream. General remarks & conclusions. The was general discussion about the problems experienced within gas balancing mechanisms Importance of transparency within & between gas balancing regimes was highlighted

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General remarks & conclusions

  • The was general discussion about the problems experienced within gas balancing mechanisms

  • Importance of transparency within & between gas balancing regimes was highlighted

  • Some issues of interaction between regimes were identified but it was pointed out that more work is needed to better understand what the problems are


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Way forward / actions

  • Development of information templates for gas balancing in consultation with stakeholders to improve transparency and therefore ability to manage risk within/across balancing mechanisms (3 “pilots” – with wider roll out if successful)

  • Development of 2 case studies on gas balancing interactions – to explore in more detail the interactions between balancing mechanisms (one could be Dutch/German to link with day ahead auction work)

  • Workstream on “blue-sky thinking” on balancing to look at issues not captured elsewhere to try and improve gas balancing mechanisms – some possible e.g’s:

    • Use OBAs

    • Use of TSO storage

    • Impact of unmetered sites


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Who & when

  • 1 week for all to respond to way forward & volunteer for Enabler Group

  • Initial outline information templates for 3 pilots: Who: Market operators. By: (20 April – 1 week before next SG workshop). Consultation. Then finalise.

  • Initial report on case studies: Who: Enabler Group. By: (20 April – 1 week before next SG workshop). Consultation. Then finalise with recommendations.

  • Initial terms of reference on „blue-sky thinking“: Who: Enabler Group. By: (20 April – 1 week before next SG workshop). Consultation. Then finalise.



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General remarks & conclusions

  • The workstream discussed the issues raised in the facilitation paper and data appendix

  • There was a recognition that transparency needs to be improved across all areas

  • There was a recognition that the less than 3 rule needs to be looked at (application, data aggregation and role of regulators)

  • There was a recognition that there are areas of best practice that we could learn from and potentially apply on a wider basis

  • There was recognition that there is potentially inconsistency in capacity data but that ERGEG should take this forward as part of their existing Task Force

  • Need to focus on regional issues and ensure coordination/consistency with EU level initiatives


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Way forward / actions

  • Development of Action Plans to help meet the issues raised by respondents to the questionnaires to improve the level of transparency

    • What/scope/frequency of information

    • Timeline for making changes etc

    • Assessment of any reasonable costs

    • Potential quick wins

    • Consultation with stakeholders

    • Identify implementation and monitoring process

  • Rule of 3:

    • Possibility publishing aggregated data

    • Development of code of practice/guidelines for better application of rule of 3

  • Best practice

    • An inventory of best practice that could be “rolled out” on a wider basis


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    Who & when

    • 1 week for all to respond to way forward & volunteer for Enabler Group

    • Action Plan: Who: Market operators. By: (20 April – 1 week before next SG workshop). Consultation. Then finalise.

    • Less than 3: Who: Enabler Group. By: (20 April – 1 week before next SG workshop). Consultation. Then finalise.

    • Best practice: Who: Enabler Group. By: (20 April – 1 week before next SG workshop). Consultation. Then finalise.



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    Conclusions (1)

    • A code of practice for regulators in the NW region should be developed

    • The code should include

      • General principles (timely, transparent, etc)

      • Checklist/issue list of market arrangements on which co-ordination should take place

      • Goal of the co-ordination is the allignment of processes (e.g. timing of open seasons)


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    General remarks

    • Cross-border user forum of all participants should be consulted on cross-border issues

    • Align regulatory co-ordination with national processes and responsibilities, where necessary include governments, users, operators

    • Process of developing regulatory co-ordination should be broadened to include governments as they often have regulatory powers - RGI is the right forum to do this


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    Way forward

    • Conclusion paper in March,

      • Highlight where issues are being dealt with

      • Highlight practical difficulties (regulatory powers, role of government)

    • Code of Practice draft in March (including how co-ordination between regulators can take place in practice)

    • Documents for discussion at April workshop



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    Hub liquidity and efficient transmission and trade of gas between hubs

    • Remarks:

    • capacity release,

    • main focus on framework (access, rules),

    • large zones with volume based tariffs with no need for capacity booking inside the zone

    • With possible merger of e.g. Danish and German hubs by further harmonisation of rules (balancing and access to capacity)

    • only benefical with large markets if enough capacity and few balacing zones,

    • Gas quality at specific hubs (Zeebrügge)

    • standardize balancing (daily vs. hourly) and products, reasonable imbalances cost if not market based, grid company and TSO should work together to make trading of imbalances possible

    • all liquidity need to be centered at the hubs


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    Conclusions

    • The barriers mentioned in answers of questionnaires are found to be the central barriers

    • Balancing and gas quality also seems to be main barriers

    • All hubs are inflicted with problems

    • Timing:

    • Deadline for comments 28 February.

    • Conclusion paper in March



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    Conclusions

    • Way forward should focus on the details at specific interconnection points

    • Assessment of the situation at specific IP requires an improved data basis (Solution: publishing of (aggregated) data, provide data to NRAs)

    • Investment important issue where contractual (?) and physical congestions occur; efficient CMP for contractually congested IP.

    • Better coordination of capacity products and booking procedures

    • Inter-TSO and inter-NRA coordination

    • Interconnection points: all the IP proposed in the slides plus Ellund, Zelzate; shippers are encouraged to give their priorities

    • No objections on the time schedule proposed




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    Contractual congestion is shown at primary capacity workshop

    Availability of firm capacity in 2005:

    Directionof flow

    Availability

    0%

    <10%

    Overall Indication for the IPs considered


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    Conclusions

    • Contractual congestion is shown, now how we can re-allocate (if available) underutilised capacity?

    • Secondary market is not a means to its end but it helps

      • Design variables: pro, con identified

        • Hot issues shown: e.g. Facilitation party, need for long term commitment, need for long and short term products

      • Tomorrow we go on that at Day Ahead Auction WS

    • Other congestion management ideas need to be assessed as solution in parallel:

      • Positive incentives

        • E.g. Clarity on investments in future (no point for hoarding), more transparency

      • Negative

        • E.g. Study on improving FIRM UIOLI and ideas like releasable capacity

    • Follow-up needs to allow for more comments




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    General remarks

    • EFET and operator proposals were discussed

    • Compliance with existing legal, regulatory and contractual requirements

    • Highly actual information on contractual data, nominated data and flow data and other information to be further defined are necessary to assess e.g. level of interruption risk

    • Wish to have firm (priority !) and interruptible capacity auctioned; process needs to be clear; recycling of capacities is needed

    • Offer of APX to organise auction on product to be defined by the market (“design variables”)

    • Pilot project

    • Review of pilot required; may lead to re-design

    • DTe offers monthly meeting in Den Haag to discuss

    • GRTgaz offers to work on additional cross border points

    • If not TSO platform, tender should be conducted

    • Commitment on start date and duration of pilot


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    Conclusions

    • Appreciation of the urgent need to act

    • Various views on type of product but majority supports combination of secondary and interruptible primary

    • Clear message by Operators that trading could start at latest on 1 April 2008

    • Clear message that market wants to start as soon as possible

    • Commitment to contribute to work plan by

      • EFET and

      • Operators and

      • Key stakeholders


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    Way forward / actions

    • Meetings/telephone conferences

      • Monthly Jour Fixe:

        • Operators at IPs

        • EFET

        • Platform operators

        • DTe and possibly BNetzA and DERA

    • Updates on process by DTe to Stakeholders and opportunity to comment

    • Presentation of renewed proposal on workshops in April