Firmness of allocated cross-zonal capacity - Page 2

 

 


 


 

Commission Regulation (EU) 2015/1222 of 24 July 2015 establishing a Guideline on Capacity Allocation and Congestion Management - CACM (Regulation on market coupling or 'CACM Guideline'), Articles 2(44), 69 - 72, 79, Recital 23

 

Article 2(44)

‘firmness’ means a guarantee that cross-zonal capacity rights will remain unchanged and that a compensation is paid if they are nevertheless changed

 

 

CHAPTER 8
Firmness of allocated cross-zonal capacity

 

Article 69
Proposal for day-ahead firmness deadline

 

By 16 months after the entry into force of this Regulation, all TSOs shall develop a common proposal for a single day-ahead firmness deadline, which shall not be shorter than half an hour before the day-ahead market gate closure time. The proposal shall be subject to consultation in accordance with Article 12.

 

Article 70
Firmness of day-ahead capacity and allocation constraints

 

1.   Prior to the day-ahead firmness deadline, each coordinated capacity calculator may adjust cross-zonal capacity and allocation constraints provided to relevant NEMOs.

 

2.   After the day-ahead firmness deadline, all cross-zonal capacity and allocation constraints shall be firm for day-ahead capacity allocation unless the requirements of Article 46(2) are met, in which case cross-zonal capacity and allocation constraints shall be firm as soon as they are submitted to relevant NEMOs.

 

3.   After the day-ahead firmness deadline, cross-zonal capacity which has not been allocated may be adjusted for subsequent allocations.

 

Article 71
Firmness of intraday capacity

 

Cross-zonal intraday capacity shall be firm as soon as it is allocated.

 

Article 72
Firmness in the event of force majeure or emergency situations

 

1.   In the event of force majeure or an emergency situation referred to in Article 16(2) of Regulation (EC) No 714/2009, where the TSO shall act in an expeditious manner and redispatching or countertrading is not possible, each TSO shall have the right to curtail allocated cross-zonal capacity. In all cases, curtailment shall be undertaken in a coordinated manner following liaison with all directly concerned TSOs.

 

2.   A TSO which invokes force majeure or an emergency situation shall publish a notice explaining the nature of the force majeure or the emergency situation and its probable duration. This notice shall be made available to the market participants concerned through NEMOs. If capacity is allocated explicitly to market participants, the TSO invoking force majeure or an emergency situation shall send notice directly to contractual parties holding cross-zonal capacity for the relevant market time-frame.

 

3.   If allocated capacity is curtailed because of force majeure or an emergency situation invoked by a TSO, the TSO shall reimburse or provide compensation for the period of force majeure or the emergency situation, in accordance with the following requirements:
(a) if there is implicit allocation, central counter parties or shipping agents shall not be subject to financial damage or financial benefit arising from any imbalance created by such curtailment;
(b) in the event of force majeure, if capacity is allocated via explicit allocation, market participants shall be entitled to reimbursement of the price paid for the capacity during the explicit allocation process;
(c) in an emergency situation, if capacity is allocated via explicit allocation, market participants shall be entitled to compensation equal to the price difference of relevant markets between the bidding zones concerned in the relevant time-frame; or
(d) in an emergency situation, if capacity is allocated via explicit allocation but the bidding zone price is not calculated in at least one of the two relevant bidding zones in the relevant time-frame, market participants shall be entitled to reimbursement of the price paid for capacity during the explicit allocation process.

 

4.   The TSO invoking force majeure or an emergency situation shall limit the consequences and duration of the force majeure situation or emergency situation.

 

5.   Where a Member State has so provided, upon request by the TSO concerned the national regulatory authority shall assess whether an event qualifies as force majeure.

 

Article 79
Costs of ensuring firmness


The costs of ensuring firmness in accordance with Articles 70(2) and 71 shall be borne by the relevant TSOs, to the extent possible in accordance with Article 16(6)(a) of Regulation (EC) No 714/2009. These costs shall include the costs from compensation mechanisms associated with ensuring the firmness of cross-zonal capacities as well as the costs of redispatching, countertrading and imbalance associated with compensating market participants.

 

Recital 23

 

Any costs incurred efficiently to guarantee firmness of capacity and to set up processes to comply with this Regulation should be recovered via network tariffs or appropriate mechanisms in a timely manner. NEMOs, including in performing MCO functions should be entitled to recover their incurred costs if they are efficiently incurred, reasonable and proportionate.

 

 


 

Network Code on Forward Capacity Allocation (FCA), Articles 53-56, 61, Recitals 11, 12

 

CHAPTER 6
Firmness of allocated cross-zonal capacity

 

Article 53
General firmness provisions


1.   All TSOs shall be entitled to curtail long-term transmission rights to ensure operation remains within operational security limits prior to the day-ahead firmness deadline. Where TSOs curtail long-term transmission rights, they shall report this to the respective regulatory authorities and also publish the factual reasons that lead to the curtailment.


2.   The concerned TSOs on the bidding zone border where long-term transmission rights have been curtailed shall compensate the holders of curtailed long-term transmission rights with the market spread.

 

Article 54
Definition of caps


1.   The concerned TSOs on a bidding zone border may propose a cap on the total compensation to be paid to all holders of curtailed long-term transmission rights in the relevant calendar year or the relevant calendar month in case of Direct Current interconnectors.
2.   The cap shall not be lower than the total amount of congestion income collected by the concerned TSOs on the bidding zone border in the relevant calendar year. In case of Direct Current interconnectors, TSOs may propose a cap not lower than the total congestion income collected by the concerned TSOs on the bidding zone border in the relevant calendar month.
3.   In case of several interconnectors operated by different TSOs on the same bidding zone border and subject to different regulatory regimes overseen by regulatory authorities, the total congestion income used for calculation of capped compensation pursuant to paragraph 2 may be dissociated between each interconnector. Such a division shall be proposed by the concerned TSOs and approved by the competent regulatory authorities.

 

Article 55
Compensation rules


Where TSOs propose to apply a cap referred to in Article 54, they shall jointly propose a set of compensation rules with regard to the applied cap.

 

Article 56
Firmness in the event of force majeure


1.   In the event of force majeure, TSOs may curtail long-term transmission rights. Such curtailment shall be undertaken in a coordinated manner following liaison with all TSOs directly affected.


2.   The TSO which invokes the force majeure shall publish a notification describing the nature of the force majeure and its probable duration.

 

3.   In the event of curtailment due to force majeure the concerned holders of long-term transmission rights shall receive compensation for the period of that force majeure by the TSO which invoked the force majeure. In this case, the compensation shall be equal to the amount initially paid for the concerned long-term transmission right during the forward allocation process.

 

4.   The TSO which invokes a force majeure shall make every possible effort to limit the consequences and duration of the force majeure.

 

5.   Where a Member State has so provided, upon request by the TSO concerned, the national regulatory authority shall assess whether an event qualifies as force majeure.

 

Article 61

Cost of ensuring firmness and remuneration of long-term transmission rights

 

1. The cost of ensuring firmness shall include costs incurred from compensation mechanisms associated with ensuring firmness of cross-zonal capacities as well as the cost of re-dispatching, countertrading and imbalance associated with compensating market participants and be borne by TSOs, to the extent possible in accordance with Article 16(6)(a) of Regulation (EC) No 714/2009.


2. When fixing or approving transmission tariffs or other appropriate mechanism in accordance with Article 37(1)(a) of Directive 2009/72/EC, and having regard to Article 14(1) of Regulation (EC) No 714/2009, regulatory authorities shall consider compensation payments as eligible costs provided that they are reasonable, efficient and proportionate.


3. Within six months after the approval of the methodology for sharing congestion income referred to in Article 57, all TSOs shall jointly develop a methodology for sharing costs incurred to ensure firmness and remuneration of long-term transmission rights. This methodology shall be consistent with the methodology for sharing congestion income from forward capacity allocation as referred to in Article 57.

 

Recital 11

 

Commission Regulation (EU) 2015/1222 establishes a day-ahead firmness deadline and a related compensation regime for long-term transmission rights curtailed after such deadline. Similarly, long-term transmission rights curtailed before the day-ahead firmness deadline should be reimbursed or compensated by TSOs to the long-term transmission rights holders.

 

Recital 12

 

Caps on the compensation to be paid to holders whose long-term transmission rights have been curtailed before the day-ahead firmness deadline may be introduced, taking into the account the liquidity of the relevant markets and the possibility for market participants to adjust their positions.

 

 

 

 

Proposal for a Regulation of the European Parliament and of the Council on the internal market for electricity (recast), 30.11.2016, COM(2016) 861 final 2016/0379 (COD), Article 8

 

Forward markets

 

1. In line with regulation (EU) 2016/1719, transmission system operators shall issue long-term transmission rights or have equivalent measures in place to allow for market participants, in particular owners of generation facilities using renewable energies, to hedge price risks across bidding zone borders.

 

2. Long-term transmission rights shall be allocated in a transparent, market based and non-discriminatory manner through a single allocation platform. Long-term transmission rights shall be firm and be transferable between market participants.

 

3. Subject to compliance with treaty rules on competition, market operators shall be free to develop forward hedging products including for the long -term to provide market participants, in particular owners of generation facilities using renewable energies, with appropriate possibilities to hedge financial risks from price fluctuations. Member States shall not restrict such hedging activity to trades within a Member State or bidding zone.

 

 

 

 

Proposal for a Regulation of the European Parliament and of the Council on the internal market for electricity (recast), 30.11.2016, COM(2016) 861 final 2016/0379 (COD), Article 14(1)(2) and (10)

 

General principles of capacity allocation and congestion management

 

1. Network congestion problems shall be addressed with non-discriminatory market- based solutions which give efficient economic signals to the market participants and transmission system operators involved. Network congestion problems shall be solved with non-transaction based methods, i.e. methods that do not involve a selection between the contracts of individual market participants. When taking operational measures to ensure that its transmission system remains in the normal state, the transmission system operator shall take into account the effect of those measures on neighbouring control areas and coordinate such measures with other affected transmission system operators as provided for in Regulation (EU) 1222/2015.


2. Transaction curtailment procedures shall only be used in emergency situations where the transmission system operator must act in an expeditious manner and re-dispatching or countertrading is not possible. Any such procedure shall be applied in a non-discriminatory manner. Except in cases of force majeure, market participants who have been allocated capacity shall be compensated for any curtailment.

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10. The financial consequences of failure to honour obligations associated with the allocation of capacity shall be attributed to those who are responsible for such a failure. Where market participants fail to use the capacity that they have committed to use, or, in the case of explicitly auctioned capacity, fail to trade on a secondary basis or give the capacity back in due time, they shall lose the rights to such capacity and pay a cost-reflective charge. Any cost-reflective charges for the non-use of capacity shall be justified and proportionate. If a transmission system operator does not fulfil its obligation, it shall be liable to compensate the market participant for the loss of capacity rights. Consequential losses shall not be taken into account for that purpose. The key concepts and methods for the determination of liabilities that accrue upon failure to honour obligations shall be set out in advance in respect of the financial consequences, and shall be subject to review by the relevant national regulatory authority or authorities.

 

 

 

 

 

 

 

IMG 0744

    Documentation    

 

 

 

 

 

Commission Regulation (EU) 2015/1222 of 24 July 2015 establishing a Guideline on Capacity Allocation and Congestion Management - CACM (Regulation on market coupling or 'CACM'), Articles 2(44), 69 - 72, 79, Recital 23

 

Network Code on Forward Capacity Allocation (FCA), Articles 4(6)(g), 52(2)(k), 52(3)(d), 53-56, 61, Recitals 11, 12

 

Supporting Document for the Network Code on Electricity Balancing, ENTSO-E, 23 December 2013

 

Proposal for a Regulation of the European Parliament and of the Council on the internal market for electricity (recast), 30.11.2016, COM(2016) 861 final 2016/0379 (COD), Articles 8, 14(1)(2) and (10

 

ACER/CEER Annual Report on the Results of Monitoring the Internal Electricity Market in 2015, September 2016

 

 

 

 

 

 

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Day-ahead firmness deadline (DAFD)

 

Capacity allocation

 

 

 

 

 

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Last Updated on Friday, 10 November 2017 21:20
 

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