FAQ & Experience€¦ · Hotel Splendid, Bečići, Montenegro AUCTION RMI VALIDITY Yearly Auction...

FAQ & Experience

SEE CAO Traders workshop, 6th November 2015

Hotel Splendid, Bečići, Montenegro

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1. Uninvoiced Liabilities

2. Risk Management Instruments

3. Financial Compensation

4. Pricing

5. Token issues

Summary



1. Uninvoiced Liabilities

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• Amount of Credit Limit which is blocked during Long Term auction preventsAuction Participant to participate on Daily Auction before final results of LTauction are published, due to small amount of money that remained as usableunder Credit Limit.

• Lack of time for increase of Credit Limit, especially if Credit Limit is placed as aBank Guarantee.

• Suggestion: Take the algorithm into consideration!



1 2 3 4 5

Bidding Prelim. results Deadline for contestation Deadline for reply oncontestation

Finalresults

CR blocked CR blocked D+1 CR blocked D+2 CR recalculatedD+3

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• Trader A places bids on three different auctions (monthly auctions with 30days, including one product with 22 days).

• Credit limit value in Damas 100 000,00 €.

• Note: Algorithm considers all bids that trader has inserted in the system per auction.

1. Uninvoiced Liabilities – Example

Bid Amount(MW) Bid price(€/MWh)

10 1,71

10 1,44

5 0,81

5 0,62


5 8,55

5 6,55


3 9,11

2 6,66

5 5,55

Auction 1: Auction 2: Auction 3:



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• Auction 1:Amount = max {30 days*24h*

[10 MW * 1,71 €/MWh;

(10MW + 10MW)*1,44€/MWh;

(10MW + 10MW + 5MW)*0,81€/MWh;

(10MW + 10MW + 5MW+5MW)*0,62€/MWh]};

= max [12312,00 €; 20736,00 €; 14580,00 €; 13392,00 €];

= 20736,00 €

1. Uninvoiced Liabilities – Calculation




10 1,71

10 1,44

5 0,81

5 0,62

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• Auction 2:Amount = max{30 days*24h*

[5 MW * 8,55 €/MWh;

(5MW + 5MW)*6,55€/MWh]};

= max[30780,00 €; 47160,00 €];

= 47160,00 €





5 8,55

5 6,55

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• Auction 3:Amount = max{22 days*24h*

[3 MW * 9,11 €/MWh;

(3MW + 2MW)*6,66€/MWh;

(3MW + 2MW + 5MW)*5,55€/MWh]};

= max[14430,24 €; 17582,4 €; 29304,00 €];

= 29304,00 €





3 9,11

2 6,66

5 5,55

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• Total amount of Uninvoiced liabilities blocked from Credit Limit, is a sum of bidding amounts on LT auctions• 20736,00 € + 47160,00 € + 29304,00 € = 97200.00€

• After final results of LT auction are published, value of Credit Limit willrelease the amount of Uninvoiced liabilities and will be blocked for the valueof Invoiced liabilities from the auction in question

1. Uninvoiced Liabilities - Results



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• Changing Deposit into Bank Guarantee and vice versa

• Procedure:• Ask for withdrawal of Deposit/Guarantee through official request

• in case of Deposit, termination of Deposit contract needs to be done; afterthat funds are returned;

• In case of Bank Guarantee, original of Bank Guarantee is returned

• After these steps are done, procedure for new RMI needs to be done fromthe beginning – issue a new BG with same amount of money as it was onDeposit (Deposit -> BG) or make payment for Deposit in the same amount ofmoney that was stated on BG (BG ->Deposit), after which the DepositContract is being signed.

Note: Procedures described previously had to be done in parallel, inorder to avoid situations with zero value of Credit Limit!




2. Validity of RMI

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“The RMI validity time must be at least 10 calendar days after due dateof last invoice of the Auction Process indicated in Auction Calendar. ”

Example:



AUCTION RMI VALIDITY

Yearly Auction for 2016 24th of October 2016.

Monthly Auction for January 2016 08th of January 2016.

Daily Auctions for January 2016 22nd of February 2016.

Provide coverage for all auctions in 2016 23rd of January 2017!

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Extending the RMI validity period:

• Deposit contract - Auction Participant should send to SEECAO properly filled template of Annex of deposit contract. On receiptof signed Annex, deposit validity will be updated in auction platform;

• Bank guarantee - Auction participant should send to SEE CAOamendment of bank guarantee, with new validity period stated, inoriginal verified by signature through SWIFT, or issued through SWIFTto SEE CAO by 12:00 CET on the last Working Day before the day ofthe Yearly Auction;




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• Bank fees are charged to Auction Participants according to Auction Rules

• Financial Compensation as a solution

3. Financial Compensation



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4. Pricing

• Reasons for such change:

• Numerous auctions with zero clearing price and RC>>OC

• Almost no nomination on those border directions.

• These congestions do not reflect real market needs.



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4. Pricing

AuctionBorder

DirectionOffered

Capacity(MW)

Requested Capacity

(MW)

Clearing Price (€/MWh)

Monthly Auction for January 2015

ME - BA 303 375 0,00

Monthly Auction for March 2015

HR-BABA-ME

301301

365402

0,000,00

Monthly Auction for April 2015

HR-BA 301 445 0,00

Monthly Auction for June 2015

BA-ME 301 506 0,00

Monthly Auction for July 2015

ME-BA 303 440 0,00

Monthly Auction for September 2015

HR-BA 401 569 0,00

Monthly Auction for October 2015

ME-BA 303 400 0,00



5. Token issues

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• Security of electronic certificate – Token gets locked (can not be used until it is unlocked by Pošta CG)• Procedure for unlocking takes too long, which can be crucial in some situations

• Delivery of the Token• Custom service fees in some countries are not covered by Pošta CG delivery

procedures

• New procedure for getting a token completely described on: http://seecao.com/document/certificateuserguide

• New software for Token for those users who are using Windows 8 and higher



http://seecao.com/document/certificateuserguide

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5. Token issues



Questions?

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?SEE CAO Traders workshop, 6th November 2015


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Thank you for your attention!

Aleksandar Drašković, M.Sc El. Eng.

Auction Operator

Phone: +382 67 231868

Email: [email protected]

SEE CAO

www.seecao.com



mailto:[email protected]

FAQ & Experience€¦ · Hotel Splendid, Bečići, Montenegro AUCTION RMI VALIDITY Yearly Auction...

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