Dr. Stefanie NEVELING - Bundesnetzagentur Dr. Benoît ESNAULT – Commission de Régulation de...

Dr. Stefanie NEVELING - BundesnetzagenturDr. Benoît ESNAULT – Commission de Régulation de l’EnergieGIF TF co-chairs18th Madrid ForumMadrid, 27/28 September 2010

1st Ten Year Network Development Plan:ERGEG opinion

218th Madrid Forum, Madrid, 27/28 September 2010

Introduction

• ENTSOG published its first TYNDP in December 2009 • ERGEG « pilot » evaluation of the 1st European TYNDP:

• Aims at preparing the future task of the Agency• Methodology assessed in the light of ERGEG recommendations on

the TYNDP (July 2010)• Based on the findings of the EWI Study commissioned by ERGEG :

“Model-based Analysis of Infrastructure Projects and Market Integration in Europe with Special Focus on Security of Supply Scenarios” (May 2010)

Applied “TIGER”-model: minimises gas dispatch costs subject to infrastructure, supply & demand assumptions; represents an economic flow model assuming efficient organisation of transport & storage market (i.e. realisation of all efficient swaps & efficient capacity management)


Is the EU gas network sufficientlyintegrated? EWI’s results

Physical need for networkexpansion until 2019:

• decreasing domestic production (e.g. in DK / S) strong need for new cross- border capacity DE DK

• missing links in SE-EU for sufficient supplies during winter months (mainly HU & Balkans, somewhat eased with Nabucco or South Stream online)

• resultant investments induced by new major infrastructures (e.g. Nord Stream/NEL)

• preventive measure against crises reverse flow projects mainly for Eastern EU countries in case of Russian supply disruption

“Potential” bottlenecks:

• For Western-EU, a potential need for capacity increases to improve market integration has been identified at several borders: DENL, DEBE, DECH, DECZ, UKBE, SKAT, ATSI, SIHR, DEFR on peak days

• Such congestions are to be analysed on a case-by-case basis and might even be healed without physical capacity increases

• There are some general West-to-East bottlenecks in the LNG “glut” scenario.

Detected bottlenecks by EWI-study:


EWI‘s simulation results comparedto ENTSOG‘s TYNDP findings

HRBA

Sl

RS

HU

RO

ITES

FR

GB

DEPL

CZ

PT

AL

BY

UA

DK

LT

BG

GR

MK

ATCH

NLBE

SK

demand-supply gaps found by EWI & ENTSOG

demand-supply gaps found by ENTSOG

Sufficient Capacity to cover demand (incl. peak-day) for all Euro-pean countries, except for DK, SE, SI, HU, BA, MK, RS

results found both by

EWI & ENTSOG

SE


Is the EU gas network sufficientlyintegrated in case of a crisis?

Scenario: „Reference“ (only Nord Stream I)

Scenario „South Stream“ (Reference + South Stream)

ERGEG/EWI study: Detected bottlenecks in “Ukraine crisis” scenario


Comments on TYNDP: scenario& modeling requirements

Results of ENTSOG’s supply, demand & capacity analysis:

• Demand assumptions higher than EU COM’s Primes Baseline Scenario

• Supply assumptions lower than forecasts by IEA

• Aggregated capacity will be sufficient to satisfy peak-day & annual demand except for 3 regions w/ demand potentially > transport capacity

ERGEG comments:

Profound & detailed database on existing and FID infrastructure projects But: lacking homogeneity in terms of details per country, identification of

bottlenecks by regions is too broad (cannot be pinpointed) Security of supply dimension not sufficiently studied yet (“crisis sc.”) no enhanced EU infrastructure modeling or simulations (“Top-down

perspective”) in varying infrastructure / supply / demand scenarios yet Next TYNDP shall include maps presenting congestion in EU


Methodology analysis: need for a top-down supervision

• Combining top-down and bottom-up approaches is a key ERGEG recommendation

• Data collection and assumptions• The first TYNDP: mainly built on data collection from TSOs and

ministries (bottom-up approach) • Lack of data homogeneity and transparency of assumptionsNeed for a transparent top-down process which would facilitate the

assessment of the TYNDP

• For the future TYNDP: ENTSOG should ensure that • TSOs elaborate coherent and consistent national capacity reports• Adjacent TSOs consistently address common cross-border

infrastructure projects


Role of stakeholders and market consultation

• Extensive consultation process conducted by ENTSOG: bilateral meetings and workshops with relevant market participants

• Stakeholders should contribute to data collection

• Collection of data for the 1st TYNDP focused on TSOs and ministries

• Lack of involvement of project sponsors• Data on domestic European production was not provided by

producers• Lack of data on non-EU gas production

• ERGEG recommendation on the role of stakeholders:• Ensure a regular dialogue• Data communication to ENTSOG• Consultation on the Community-wide TYNDP


Addressing market integrationand security of supply

• Market integration• Should be formally included in the analysis• Identify where the European system lacks of capacity• The TYNDP should contribute “to non-discrimination, effective

competition, the efficient functioning of the market or a sufficient level of cross-border interconnection open to third-party access”.

• Security of supply• TEN-E projects, the EEPR and the reverse flow study: no details on

how these projects were taken into account in the TYNDP• Scenario comparisons should include simulations of the behaviour of

the EU infrastructure – test different scenarios of infrastructure • Need to simulate system’s reaction over longer periods of

exceptionally high demand


Conclusions

• ERGEG welcomes ENTSOG’s challenging work• Instructive process for all actors involved• Comprehensive database on infrastructures and projects

• Findings on the status of the European gas system• According to EWI-Study and ENTSOG’s TYNDP, the EU gas grid

- in technical terms - is well developed (under assumptions taken) • But some (physical and potential) bottlenecks identified• Precondition to avoid inefficient network expansion:

effective capacity management

• Room for improvements:• Methodology & homogeneity of assumptions• Results (identification of bottlenecks) more precise (map) • Security of supply dimension (missing “crisis scenarios”)• Gas flow modeling for varying scenarios


Way forward

• Analysis of consultation results / comments by stakeholders on EWI-study

• Providing input & advice to the

• EU COM - on Energy Infrastructure Package

• ENTSOG - on TYNDP methodology for the 2nd TYNDP and 2010 Network modeling improvements; next milestone: ENTSOG workshop 7. October

• ACER - on its future tasks related to TYNDP, refining further aspects, such as coordination &

relation to national /regional network development plans


Thank you!

Dr. Stefanie NEVELING - Bundesnetzagentur Dr. Benoît ESNAULT – Commission de Régulation de...

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