CHAIRE EUROPEAN ELECTRICITY MARKETS. Networks in the Clean energy package: welcomed harmonization or excessive standardization?

Transcription

1 CHAIRE EUROPEAN ELECTRICITY MARKETS JANUARY 30 TH 2017 v Netwrks in the Clean energy package: welcmed harmnizatin r excessive standardizatin? Dminique Jamme Head f Netwrks, CRE

2 CONTENT The Clean energy package: a new framewrk t back the transfrmatin f the electricity sectr Sme areas f cncern : Implement the current netwrk cdes as a matter f pririty Find the efficient level f reginal cperatin Avid verregulatin Strengthen the cmplementarity between NRAs and the Agency 2

3 THE CLEAN ENERGY PACKAGE: A NEW FRAMEWORK TO BACK THE TRANSFORMATION OF THE ELECTRICITY SECTOR Electricity markets are evlving rapidly The energy transitin is nging, with ambitius targets by 2030 A minimum 27% share f renewable energy cnsumptin Reductin f energy cnsumptin by 30% Reductin f GhG emissins by at least 40% The Clean energy package prvides a framewrk t deal with the decentralizatin f resurces Reinfrcement f reginal cperatin Better integratin f renewable energy in markets Adaptatin f DSOs rle and respnsibilities Recgnitin f the essential rle f demand respnse, and f independent aggregatrs This is a very strng signal fr the market 3

4 THE CLEAN ENERGY PACKAGE AND THE CURRENT REGULATION: RISK OF OVERLAP Implementatiin f the different netwrk cdes elabrated at EU level July 2015 May 2016 September 2016 Octber 2016 Nv 2016 June 2017 S2 2017? Entry int frce Capacity Allcatin and cngestin mechanism (CACM)L Entry int frce Requirements fr Generatrs (RFG) Entry int frce Demand cnnectin + HVDC cnnectin Entry int frce Frward Capacity allcatin (FCA) Cmitlgy Electricity Balancing Entry int frce System Operatin (SO) Entry int frce Emergency & restratin 7 netwrk cdes adpted since July 2015, 1 is still under cmitlgy prcess Their implementatin shuld remain the pririty New regulatin shuld be develped where the benefits fr cnsumers are greatest and where actin at Eurpean level is mst efficient Dubts regarding a netwrk cde n tariffs methdlgies (especially regarding distributin) It shuld cncern general principle such as transparency, cst reflectivity, nn discriminatin It shuld nt enter int technical parameters nr neglect natinal specificities such as thermsensitivity fr France 4

5 REGIONAL COOPERATION IN THE CLEAN ENERGY PACKAGE The Clean energy package insists n an increased reginal cperatin t deliver a Eurpean-wide security f supply Reginal cperatin has been at the cre f integrating Eurpean electricity markets fr years: the gradual apprach used s far is still apprpriate Example: reginal initiatives in electricity Created in 2006 by ERGEG - cperatin framewrk that includes NRAs, TSOs and NEMOs France belngs t 4 ut f the 7 EU reginal initiatives Objectives: Use wrk dne at reginal level as input fr netwrk cdes Anticipate the implementatin f netwrk cdes Examples f results Harmnized rules fr the allcatin f lng term rights Day-ahead market cupling at all ur brders with EU cuntries and implementatin f flw based market cupling in CWE Implementatin f the XBID slutin fr intraday cupling brder by brder Surce : RTE 5

6 FROM RSC TO ROC: WHAT IS THE MOST EFFICIENT LEVEL OF REGIONAL COOPERATION? Fllwing 2006 blackut: creatin f Reginal Security Crdinatrs (RSC) (Cres, TSC, etc.) t increase the safety f electricity netwrks. The SO GL prvides that by 2018, the gegraphical cverage f RSC as well as the scpe f their activities shall be extended: this prvisin will already result in an increased reginal cperatin. The Clean energy package creates Reginal Operatin Centers (ROCs), that wuld cnsist in transferring peratinal missins frm TSOs t ROCs. This raises numerus questins: Is it apprpriate t transfer (part f) the respnsibility fr system security frm TSOs t ROCs (security supply and subsidiarity issue)? Is a supra-reginal scale efficient fr all tasks delegated t ROCs? Wuld it allw fr enugh lcal flexibility? Unnecessary administrative burden? Shuldn t we implement first SO GL and wait fr a feedback befre rlling ut ROCs? In the end, wh will be respnsible fr keeping the lights n? 6

7 FROM RSC TO ROC: WHAT IS THE MOST EFFICIENT SCALE OF REGIONAL COOPERATION? Frm 5 main missins f the RSC (SO GL) 16 missins f the ROC (Winter Package) At the capacity calculatin level: elabrate cmmn grid mdels perfrm the crdinated reginal peratinal security assessment based n elements frm each TSO. And recmmend t the relevant TSOs the mst effective and ecnmically efficient remedial actins perfrm the crdinated capacity calculatins realize utage planning crdinatin realize seasnal adequacy utlk Green > same prvisins Orange > new nes - cmpetences transferred frm TSOs t ROCs Crdinated security analysis Creatin f cmmn system mdels Crdinated capacity calculatin Outage planning crdinatin Seasnal adequacy utlk (if it is a task delegated t ROC) Assessment f TSOs defense and restratin plans Crdinatin and ptimizatin f reginal restratin Pst-peratin and pst-disturbances analysis and reprting Reginal sizing f reserve capacity Facilitate the reginal prcurement f balancing capacity Reginal week ahead t ID system adequacy frecasts Optimizatin f cmpensatin mechanisms between TSOs Training and certificatin Identificatin f reginal crisis scenaris Preparatin f yearly crisis simulatins (in cperatin with cmpetent authrities) Identificatin f reginal crisis scenaris (if it is a task delegated t ROC) Calculate the max entry capacity available fr the participatin f freign capacity in capacity 7 mechanisms)

8 CAPACITY ALLOCATION AND CONGESTION MANAGEMENT Principles n capacity allcatin and cngestin management are part f the CACM guideline, nt implemented yet (capacity calculatin methds t be submitted by TSOs t regulatrs Q3 2017) Yet, the Clean energy package adds anther layer Basically, TSOs wuld have t maximize crss-brder capacities first, and then t deal with cnsequences n their natinal netwrks Shuld the pririty be given t maximising crss-brder capacities even when the csts f remving internal cngestin (redispatch ) utweigh the benefits f crss-brder exchanges? 8

9 BALANCING MARKETS IN THE CLEAN ENERGY PACKAGE The Electricity Balancing (EB) Guideline, currently under cmitlgy prcess, aims at integrating Eurpean balancing energy markets, Integratin tls will be standard prducts fr balancing energy t be shared by all TSOs. In France, a radmap t adapt balancing rules t the energy transitin and t the EB guideline is being prepared (prpsal by RTE, public cnsultatin by CRE ending January 2017) The full implementatin f the EB guideline is frecast fr 2023 The Clean energy package ges far beynd: mandatry dimensining and prcurement f balancing capacity at reginal level. N assessment f benefits, while csts f immbilizing intercnnectin capacity and disrupting market cupling appear t be sure and significant Cmmn prcurement f balancing energy is nt even functining yet Thrugh impact assessments are needed befre ging further ahead. 9

10 OTHER AREAS OF CONCERN Suppressin f price cap n shrt term markets The cap is 3O00 /MWh in CWE regin. Ecnmics thery tells price caps shuld be suppressed. Hwever, there is a risk f creating new barriers t entry with n sizeable gains In additin, their remval may incur high financial risks fr husehlds, especially if they pt fr dynamic-price cntracts Demand respnse and agregatrs The prpsal rightly recgnises f the rle f aggregatrs, functining independently frm suppliers Nevertheless: cmpensatin t supplier/balance respnsible is cnsidered an exceptin: lack f understanding f the nature f the interactin between the agregatr and the supplier 10

11 ACER AND NRAS COMPLEMENTARITY (1/2) The Clean energy package expands the pwers f ACER, which will be entitled t new missins, alng with the new reginal dimensin in the Package ACER t decide n netwrk cde implementatin End f the all-nra apprval prcess? ACER t supervise new entities (ROCs, NEMOs, etc.) ACER will be able t mdify netwrk cdes prpsed by ENTSO-E, and t mdify methdlgies elabrated fr netwrk cdes implementatin Culd ACER amend the market cupling algrithm? 11

12 ACER AND NRAS COMPLEMENTARITY (2/2) The well-functining f the Agency relies extensively n the cmpetences and resurces f NRAs. The gd cperatin f NRAs with ACER has been critical in helping t create a cmpetitive Internal Energy Market : NRAs and the Agency are cmplementary The legitimacy and relevance f ACER s decisins culd be undermined by a centralisatin f decisin-making pwers in the hands f the ACER Directr The prpsed use f simple majrity vting, rather than qualified majrity in the BR wuld prfundly, and negatively, affect the checks and balances within the BR itself and within the Agency The BR shuld be given a right f amendment f acts that require its favurable pinin 12

13 v Thank yu fr yur attentin