Gas Regional Initiative – North West Region Pierre-Marie Cussaguet (CRE) Dr. Stefanie Neveling...

Gas Regional Initiative – North West Region

Pierre-Marie Cussaguet (CRE)Dr. Stefanie Neveling (BNetzA)

Bonn Workshops8 and 9 Feb. 2007

Workshop: Interconnections & Primary Capacity Market

2 GRI – NWWorkshop in Bonn on Interconnections: Primary Market, 8 Feb. 2007

Agenda

10:00 – 10:15 Opening Address

10:15 – 10:45 Presentation of preliminary general findings

10:45 – 11:15 Comments from network operators andstakeholders

11:15 – 11:45 Coffee Break

11:45 – 12:15 Presentation of the situation at selected interconnection points

12:15 – 13:00 Comments from network operators and stakeholders, proposal & discussion on the way

forward and workshop results for closing session

13:00 Lunch


Content

I. Introduction & general / procedural matters

II. Preliminary findings on general issues

III. Situation at selected interconnection points

IV. Way foward / next steps


I. Introduction & general / procedural matters

II. Preliminary findings on general issues


IV. Way forward / next steps

Content


I. Introduction

Development

• Questionnaire / action report for discussion in IG / SG meetings; approved by the RCC on 21st Nov 2006

involved key operators E.ON Gastransport, BEB and GRTgaz (at a later stage)

• Questionnaire sent on 6th Nov. for answers on 6th Dec. E.ON Gastransport & Fluxys answered late (mid-january) Gassco (N) did not answer Bocholtz & Ellund: questionnaire not sent to all concerned

TSOs

• Therefore only 23 IPs were analysed and assessment of answers by CRE & BNetzA delayed

Answering to questionnaires has to be improved


I. Introduction

Specific difficulties

• Very large number of confidential data Reason: 3-minus-rule?

• Partially imprecise / unclear / missing answers & data


I. Introduction

The following targets have been agreed and have been covered in the questionnaire:

• Target 1: Capacity products and services offered at interconnections should be compatible so that trade and competition is not distorted - Questionnaire Part 4

• Target 2: Allocation rules of capacity and booking rules/procedures at cross-border points should be coordinated by adjacent TSOs so that trade and competition is not distorted - Questionnaire Part 5 & Part 6


I. Introduction

• Target 3: Congestion management procedures need to be coordinated so that trade and competition is not distorted – incl. investments issues - Questionnaire Part 7

• Target 4: Nomination, re-nomination and matching procedures should be harmonized or at least made compatible at each cross-border point - Questionnaire Part 8


38 interconnection points (IP)

14 TSOs involved

I. Introduction


I. Introduction

Goals for the workshop

• Summary of the findings

1.) general 2.) specific findings for selected IPs

details to be found in the report

• Comments by the TSOs and stakeholders to identify relevant issues and priority setting

• Selection of IPs of high importance to be dealt with primarily

• Development of a working schedule


I. Introduction & general (organizational) matters

II. Preliminary general findings



Content


II. Preliminary general findings

1. Data confidentiality

2. Capacity Products & Services offered

3. Capacity Booking Procedures

4. Physical Congestion & Capacity Allocation Mechanisms (CAM)

4.1. Utilization rates 2005

4.2. CAM for existing capacity

5. Investments in new cross-border capacities / CAM

6. Contractual Congestion & Congestion Management Procedures (CMP)

6.1. Status of booked capacity for 2007

6.2. Application of CMPs

6. Nomination, Re-Nomination & Matching


Confidentiality on Capacities (2005)

• 1 IP:

only confidential

• 17 IPs (74% of all IPs):

rate of confidential data

between 0% and 100%

• Only 5 IPs (22 % of all IPs):

all data requested have been

provided



Confidentiality on Utilization Rates (2005)

• 16 IPs (70% of all IPs): rate of confidential data between 0% and 100%

• 3 IPs: only confidential

• 4 IPs (17% of all IPs): all data requested have been provided



Confidentiality on Rates of Subscription (2007)

• 15 IPs (65% of all IPs): rate of confidential data between 0% and 100%

• 2 IPs: only confidential data

• 6 IPs (26% of all IPs): all data requested have been provided



2. Capacity Products

Questions on: type of capacity products offered

• Entry / Exit capacities

• Firm / Interruptible capacities

• Daily / monthly / yearly / multi-yearly capacities

General findings:

• At 14 out of 25 Interconnection Points (IPs) all involved TSOs offer

all listed products for the main direction of flow

• At 6 IPs there are mismatches (different products at each side)

• At 5 IPs problems exist

Importance of combined capacity products?


2. Capacity Products

Questions on: Capacity Situation 2005

• Maximum Technical capacity

• Firm / Interruptible capacity

General findings:

• Technical (= firm) capacity at IPs where data has been provided

does not match between adjacent TSOs

• Mostly only interruptible capacities available (esp. reverse flow)

Importance of matching of technical capacities?

• Entry / Exit capacity

• Contracted / Available capacity


3. Booking procedures

Questions on:

• Booking Periods

• Separate booking / coordination of Booking Procedure

General findings:

• At only 2 cross-border points the timeframe for booking matches for

daily firm (Entry or Exit) capacity.

• The shorter the duration for booking is, the less the timeframe for

booking procedure is the same.

• For any given duration, the timeframe matches more frequently for

interruptible capacity than for firm capacity

• Booking at adjacent TSOs always separately and not coordinated

Importance of matching of booking procedures?


4. Physical congestion & CAM

4.1 Maximum Utilisation Rates 2005

Missing data needs to be delivered to CRE / BNetzA



4.2 CAM for existing capacity

Questions on:• Type of CAM applied (FCFS, Open Subscription)• Coordination of CAM between adjacent TSOs

General findings:• CAM applied or legally required for does not match at 3 IPs

• FCFS is always applied, except for Fluxys (although legally required – TSO’s answer)

• FCFS is legally required in D, NL, B, UK (TSOs answers)• Open Subscription is only applied in F, UK and legally required in

UK (TSO’s answer)• At all IPs no coordination of CAM between adjacent TSOs



Questions on: Auctions• Auctions undertaken for existing capacity

General findings:• Only National Grid (UK) untertakes long & medium term auctions

annually, GdFD one auction in 2005, daily short term auctions done by National Grid (UK) and GRTgaz (F) (since 11/06)

• In Belgium auctions are forbidden by law (TSO’s answer)• Auctions are not coordinated between adjacent TSOs



Questions on: Day ahead capacities auctions (DACA)

• Auctioning of day-ahead capacity implemented / feasible

General findings:

• Only GRTgaz has implemented day ahead auctions at 3 IPs

• Feasibility study: Wingas, EGT

• 3 TSOs: feasible

• 4 TSOs not feasible: due to implementation constraints (IT-System), conflicting implementation periods

FCFS most frequently used CAM Rarely other mechanisms Better coordiniation necessary? FCFS: no? Auctions: yes? Improvement of CAMs?


5. Investments / new capacities

Questions on: • Type of CAM applied for new capacities (Auction, Open Season) • Coordination of CAM for new cross-border capacities• Auctions

General findings:• CAM not legally required at 87% of all IPs • Where increases are planned, capacities are mostly already allocated• Open Season applied by BEB (D), GTS (NL), Interconnector (UK),

GRTgaz (F) • No auctions applied for new capacity• No coordination concerning CAMs for new capacities

Capacity allocation has to be non-discriminatory


Directionof flow

0%

<10

%

Overall Indication for the

IPs considered

Availability

6. Contractual congestion & CMP

Availability of firm capacity in 2005:



Rates of subscription in 2007:

Directionof flow

0%

<10

%

Availability

insufficient firm capacity available

Overall Indication for the

IPs considered



Questions on: • applied CMPs (firm/interruptible UIOLI, sec. Market)• UIOLI details, coordination

General findings:• Booking level at which CMPs are applied: different (e.g. 90%, any

level, at each refusal)• firm UIOLI often implemented but practically rarely applied• Zero-nomination on day before delivery leads to «Lose it» at only

35% of IPs• Only 35% of TSOs have seized an amount of capacity by application

of UIOLI but offered it to the market only on interruptible basis

Is coordination necessary? Should capacity be offered as firm capacity?


7. Nomination & Matching

Questions on:• Application of Easee-gas CBP concerning nomination, re-

nomination and matching

General findings:• Easee-gas nomination, re-nomination and matching procedures

applied at 75% of IPs • At the remaining IPs at least one TSO does not apply the

procedures

Should Easee-gas CBP always be applied?


Summary

• Few data have been provided. Missing data to be delivered to CRE / BNetzA

• Offer of capacity products not everywhere coordinated• Booking procedures are not coordinated• Allocation mechanism for existing capacities mostly FCFS• Day ahead capacity auctions rarely implemented• Capacities seized by application of UIOLI are offered on interruptible

basis• Auctions for allocation of new capacities are an exception


Discussion

What are the key priorities?

• Importance of matching of products and booking procedures?

• Improvement of CAMs?• Insufficient firm capacity available?• Should CMPs be improved?• Investment in new cross-border capacities necessary?



II. Preliminary general findings on main issues



Content


III. Situation at selected IPs

Key findings for 6 selected interconnection points

1. Taisnières (F – B)2. Obergailbach (F – D)3. Oude Statenzijl (NL – D)4. Eynatten (B – D)5. Bacton (UK – UK)6. (Zevenaar) (NL – D)

Selection criteria:

• Trying to represent the whole region (as many different TSOs as possible)

• Importance / dimension regarding technical capacity

• Avoid IPs with missing data / answers from adjacents TSOs (e.g. Gassco, Eni, Dangas)

Importance in the shippers‘ view?


Map: GTE

1. Obergailbach / Medelsheim


What does not match / problems:

• Allocation of new capacities not coordinated• in 2005, investments in new cross-border capacities on both sides were not

coordinated

• Data on monthly capacities:• provided by GRTgaz & EGT, provided for only Q4 2005 by GDFDT

• only GRTgaz & GDFDT publish historical capacities on their website

• Data on rates of subscription:• GRTgaz publishes (monthly) booked capacities (2007) on its website

• EGT and GDFDT publish nothing on their website

• Utilization rates:• EGT provided monthly data on utilization rates (2005). GRTgaz and GDFDT

have provided it for only Q4 2005.

• In 2006, GRTgaz published daily flows, but EGT and GDFDT published only monthly maximum/minimum utilization rates



Main issues to be solved:

• Harmonization of published data on capacities and flows• What information on capacities and gas flow are needed? / What information

should be published by TSOs on their website?

• Are maximum/minimum flows sufficient and useful signals for shippers? / Should daily flows be published instead of maximum and utilization rates?

• Inter-TSO coordination• How can CAM for new capacities be coordinated?

Possible solutions / Priority goals / Way forward?



Map: GTE

2. Taisnières/Blaregnies/Quévy


In 2005 the level of booked capacity washigher than that of firm capacity at Quévy(exit from Finpipe)

What does not match:The levels of booked capacities do not match

for 2007

However, the utilization rate was lowerthan the level of firm capacity



Main issues to be solved

• Inter-TSO coordination• How can CMP and CAM be coordinated?



• Are maximum/minimum flows sufficient and useful signals for shippers? / Should daily flows be published instead of maximum/utilization rates?

Possible solution

/ Priority goals

/ Way forward?



Map: GTE

3. Oude Statenzijl (13E)


What does not match: Data on capacity, rates of subscription and utilization rates provided and published by

BEB

GTS: data confidential

CAM for new capacities are different: OSWPR for GTS vs OSWR for BEB

CAM for existing capacities:

FCFS applied but not coordinated

ST and LT UIOLI for existing/new

capacities not coordinated

At the German border side:4% < utiliz. rate (Oct.-Dec. 2005) = 67%rates of subscription for 2007 = 100%



Main issues to be solved:



• Are maximum/minimum flows sufficient and useful signals for shippers? / Should daily flows be published instead of maximum and utilization rates?

• Inter-TSO coordination• How can CMP and CAM for existing/new capacities be coordinated?

• Day-ahead capacity auctions• Should a market day-ahead capacity auction mechanism be implemented?

Possible solutions / Priority goals / Way forward?



Map: GTE

4. Eynatten


4. Eynatten

Eynatten Exit E.ON Gastransport

0

500

1.000

1.500

2.000

2.500

3.000

3.500

4.000

4.500

Janu

ary

Febru

ary

Mar

chApr

ilM

ayJu

ne July

Augus

t

Septe

mbe

r

Octob

er

Novem

ber

Decem

ber

MW

h/h

Technical Exit Capacity Contracted Firm Exit Capacity

Maximum utilization rate Exit Capacity seized UIOLI capacity

Fluxys (B) RWE (D) / E.ON Gastransport (D) Fluxys (B) Wingas


4. Eynatten

Key findings Fluxys EGT/RWE

Mismatches:

• EGT fully booked out: 2005 exit, 2007 both directions

• Fluxys entry and exit available 2005 and 2007

• Confidentiality RWE

• Fluxys does not offer interruptible products, except domestic entry

• Fluxys does not offer online booking for non-domestic transports

• Fluxys does not apply UIOLI for non-domestic transports (although legally required?)

• Only EGT seized capacities by application of UIOLI and offered it on interruptible basis

• RWE does not apply Easee-gas CBP


4. Eynatten

Further Problems:

• No auctions (in Belgium forbidden by law?)

• No Coordination: booking procedure, (short-term) CAM, UIOLI

Key findings Fluxys (B) Wingas

• Rate of subscription 2007 exit Wingas 99-100%

• No data on utilisation of Wingas exit and Fluxys entry

• Basically same problems as for Fluxys / RWE and EGT

Priority issues to be solved: non-combined capacity products? UIOLI?


Map: GTE

5. Bacton


5. Bacton

Key findings Bacton (H-Gas): National Grid (UK) Interconnector (UK)

Problems & Mismatches:

• Firm Interconnector capacity sold out until 2018; long term contracts

only interruptible cap. available on an hourly basis, but NG (entry) offers daily capacity

• No data on contracted Interconnector capacity

• Interconnector seized no capacity by application of UIOLI, although there was no full utilisation

• No coordination of CAM, booking, UIOLI, auctions


5. Bacton

Interconnection Point 52B: BactonInterconnector >>> National Grid (UK)

0

5

10

15

20

25

30

35

1 2 3 4 5 6 7 8 9 10 11 12

2005

GW

h/h

Technical CapacityInterconnector - Exit

Maximum UtilisationRate (of techn. cap.)Interconnector Exit

Contracted FirmCap. NG - Entry

Technical capacityInterconnector -Entry

Maximum UtilisationRate (of techn. cap.)Interconnector -Entry


5. Bacton

Further problems:

• National Grid does not apply Easee-gas CBP• UIOLI products not fully compatible (regarding timing)

• NG raised a modification proposal to reform exit capacity regime• Now situation has changed (new import routes (BBL), LNG)?

Priority issues to be solved: non-combined capacity products? Improve coordination Offer firm long term UIOLI products? Interconnector: auctions?


Map: GTE

6. Zevenaar


6. Zevenaar

Key findings Zevenaar (L-Gas):Gas Transport Services (NL) RWE (D) / E.ON Gastransport (D)

Matches: • All TSOs offer all capacity products• All TSOs apply all listed CMPs

Mismatches:

• RWE does not apply Easee-gas CBP

• UIOLI procedure not harmonised

• Zero-nomination on day before delivery leads to ‚lose it‘: only EGT and GTS

• Booking periods of daily firm capacity:

GTS 3 months, EGT 20 working days in advance (acceptable?)


6. Zevenaar

Further mismatches & problems:

• GTS delivered no data on exit quantities, utilization & subscription rates, amount monthly seized by UIOLI

• RWE delivered confidential data

• No auctions implemented (day ahead auctioning would require

considerable IT adjustments (GTS))

• No Coordination of (short-term) CAM, booking procedure (separate),

UIOLI

General comments by TSOs:

• GTS: Primary market needs capacity (not more/different CAMs)

efforts needed to stimulate investment

• EGT: Reliable and secure services should be kept in mind when

discussing methods for firm capacity on the primary market


Discussion

Classification by GTE Location interconnected TSOs1B, 1C Zeebrugge IZT Interconnector Fluxys

2B Zelzate Fluxys GTS 3 Hilvarenbeek GTS Fluxys 4 Obbicht GTS Fluxys 5 s'Gravenvoeren GTS Fluxys

6A, 6B Eynatten Fluxys Wingas 6C, 6D Eynatten Fluxys E.On Ruhrgas RWE

9A Quévy GRTgaz Fluxys 9B Blaregnies GRTgaz Fluxys 9C Taisnières GRTgaz Fluxys 10 Bocholtz GTS E.On Ruhrgas ENI

11A Zevenaar GTS E.On Ruhrgas 11B Zevenaar GTS RWE 12 Winterswijk GTS E.On Ruhrgas

13A Oude Statenzijl GTS Wingas 13B Oude Statenzijl GTS E.On Ruhrgas

13C, 13D Oude Statenzijl GTS BEB 13E Oude Statenzijl GTS BEB 13 F Oude Statenzijl GTS EWE

16A, 16B Ellund Energinet.dk E.On Ruhrgas BEB Dong17 Dragor Energinet.dk Nova Naturgas 28 Obergailbach E.On Ruhrgas GRTgaz GDFDT

52A, 52B Bacton National Grid Interconnector 53 Moffat National Grid Bord Gais

78A Zandvliet H Fluxys GTS 78B Zandvliet L Fluxys GTS

Important IPs to be dealt with primarily?



II. Preliminary general findings on main issues



Content


IV. Way forward / next steps

responsibility deadline deliverable

Comments by stakeholders on selection of IPs to be worked on primarily

CRE / BNetzA February 23 List of IPs

Comments by stakeholder on priorities for each of the selected points

CRE / BNetzA February 23 List of IPs and related priorities

Comments from stakeholders on the report CRE February 28 ReportDraft implementation plan containing issues to be solved at each selected IP

CRE / BNetzA March 1 Implementation plan

Final report CRE March 9(Workshops on the implementation plan) (April 16 / 17)(Approval on implementation plan) (RCC) (May 2)Implementation phase

Meetings by adjacents TSOs (NRAs and further stakeholders if necessary)

TSOs

Comments to:

[email protected]

[email protected]


General remarks

Prepare a common slide revealing the outcome of this workshop! (15min)


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


Way forward / actions

•

•

•

•

•

•

•

responsibility deadline deliverable

Comments by stakeholders on selection of IPs to be worked on primarily

CRE / BNetzA February 23 List of IPs

Comments by stakeholder on priorities for each of the selected points

CRE / BNetzA February 23 List of IPs and related priorities

Comments from stakeholders on the report CRE February 28 ReportSubmit missing data to CRE / BNetzA (esp. utillisation rates)

TSOs / NRAs February 28 Data

Draft implementation plan containing issues to be solved at each selected IP

CRE / BNetzA March 1 Implementation plan

Final report March 9(Workshops on the implementation plan) CRE (April 16 / 17)(Approval on implementation plan (RCC) (May 2)Implementation phase

Meetings by adjacents TSOs (NRAs and further stakeholders if necessary)

TSOs


Eynatten Entry Fluxys

0

100.000

200.000

300.000

400.000

500.000

600.000

700.000

800.000

900.000m

N3 /h

Technical Entry CapacityContracted Firm Entry Capacity Maximum utilization rate Entry Capacityseized UIOLI capacity

Gas Regional Initiative – North West Region Pierre-Marie Cussaguet (CRE) Dr. Stefanie Neveling...

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