Dennis Hesseling, Head of Gas Department GIE Sofia, June

Transcription

1 ACER s Role after the First Network Codes: Monitoring, Change Management, Investments Dennis Hesseling, Head of Gas Department GIE Sofia, June

2 Overview.Market monitoring.implementing, monitoring and amending Network Codes.Infrastructure investments 1

3 State of the market Supply sourcing costs have been converging although differences persist 2014 Calculated gas sourcing cost * compared to TTF (= 23.7 /MWh) <1 euro/mwh 1-3 euro/mwh >3 euro/mwh Price levels are higher in those regions with less competitive market frames Less developed hubs Weaker interconnection * Suppliers sourcing costs take into account both border import and diverse hub product prices. A weighted average of monthly sourcing costs and demand is performed to obtain the yearly figure. Source: ACER estimates based on NRA input, Eurostat Comext, BAFA, Platts. GIE, Sofia, 10 June

4 State of the market 2015 sees further convergence 2015 Calculated gas sourcing cost * compared to TTF (= 21.0 /MWh) <1 euro/mwh 1-3 euro/mwh >3 euro/mwh 1. Influence of lower oil price 2. Impact of reverse-flows 3. Improved LNG competitiveness * Preliminary results Source: ACER estimates based on NRA input, Eurostat Comext, BAFA, Platts. GIE, Sofia, 10 June

5 Infrastructure development Infrastructure investments, in particular in reverse flow capabilities, also contribute to higher price convergence Example: non traditional direction capacity expansion on key CEE borders CEE region is more integrated with other regions and sees more competition: Reverse-flow capabilities and new IPs increase security of supply through increased gas flow flexibility and facilitate market integration Backhaul services offered on physically uni-directional IPs facilitate market functioning Source: ENTSOG GIE, Sofia, 10 June

6 Integration of Ukrainian market EU gas reverse flows legislation offers Ukraine - besides Russian gas a 2 nd gas source which is hub based Ukraine gas imports (bcm/month) and estimated Ukrainian gas import prices - /MWh Key Slovak IP reverse flow enabled, allowing for more UA import Gazprom started aligning their price policy more and more to EU gas hub market dynamics Ukraine market is getting more integrated into EU market Sourcing of gas from EU via hub trades New market for oversupplied EU shippers GIE, Sofia, 10 June

7 .Market monitoring.implementing, monitoring and amending Network Codes.Infrastructure investments 6

8 Overview of Gas Network Codes and Guidelines Start date: Q3/2012 EC takes over: Q4/2015 Exp. publication: Q4/2016-Q1/2017 Exp. application: Q1/2018 Start date: Q1/2012 EC takes over: Q4/2013 Published: Q2/2015 Applicable: 1/05/2016 Start date: Q2/2011 EC takes over: Q1/2013 Published: Q1/2014 Applicable: 1/10/2015 Start date: Q1/2011 EC takes over: Q4/2012 Published: Q4/2013 Applicable: 1/11/2015 Start date: Under ERGEG EC takes over: Q3/2011 Published: Q3/2012 Applicable: 1/10/2013 Draft NC on Harmonised Tariff Structures Promotes costreflective tariffs to avoid discrimination between cross-border and domestic users and allows for appropriate reconciliation of TSO revenues NC on Interoperability and Data Exchange Rules Requires operational, technical, business communications under standardised formats NC on Balancing Allows network users to take out less/ more gas than they have injected into the system and balance their positions, previously an exclusive TSO activity NC on Capacity Allocation Mechanisms Promotes and defines harmonised capacity allocation mechanisms via auctions, standardised bundled cross border capacity products at interconnection points Commission Guidelines on Congestion Management Procedures Promotes better use of interconnection capacity through an improved handling of contractual congestion Timeline: Q1/2011-Q1/2018 GIE, Sofia, 10 June

9 CAM: Bookings platform(s) selected by TSOs State of play PRISMA GSA RBP No cross-border IP or exemption IP with no agreement on a booking platform yet Disputed IPs: 2 IPs between Germany and Poland IP Austria Hungary GIE, Sofia, 10 June

10 CMP: Assessment of contractual congestion at IPs Result: 41 contractually congested IP sides in the EU in 2015 (vs. 36 instances in 2014) Most congested IP sides are triggered by the lack of offer of firm capacity New ACER report on contractual congestion: ACER-finds-stillcontractual-congestionin-European-Gas- Networks.aspx IP sides GIE, Sofia, 10 June

11 BAL: implementation timelines GIE, Sofia, 10 June

12 Gas Network Codes Functionality Platform Common initiative ACER ENTSOG Stakeholders can raise issues related to implementation and operation of Network Codes Should lead to commonly agreed solutions Pilot do submit your issues! GIE, Sofia, 10 June

13 .Market monitoring.implementing, monitoring and amending Network Codes.Infrastructure investments 12

14 Overview of investment requests / CBCA decisions Investment requests with CBCA state of play Gas Electricity Inv. Request / CBCA decisions taken by NRAs 4 13 Inv. Request / CBCA decisions taken by ACER 1 1 Note: investment requests and CBCA decisions may contain several PCIs Last update: 20/1/2016 GIE, Sofia, 10 June

15 Overview of investment request / CBCA decisions Investment Requests with CBCA - Costs Total Investment costs (in bln) Average Investment costs per investment request (in mln) Gas Total Investment Costs (in million) Number of investment requests with CBCA Investment cost / investment request (in million) Electricity Gas 4, ,0 2,0 4,0 6,0 Electricity Gas Electricity Last update 20/1/2016 Note: Many promoters indicated their intention to apply for CEF support to cover significant part of the investment costs GIE, Sofia, 10 June

16 Overview of investment request / CBCA decisions NO FI GAS Transmission IE 5.3 (part) 5.2 UK NL DK LN G SE LT EE UG S LV LNG UGS GAS Transmission - ACER LNG Terminal GAS Underground Storage GAS Reverse Flow or Compressor Station ELEC Transmission ELEC Transmission - ACER BE 5.12 DE PL LU (cluster) 6.2 (cluster) 5.18 CZ SK UA PT ES FR 5.7 IT AT SI HR BiH HU ME (RO-HU sections) 6.13 (cluster) RS KO 6.14 FYROM RO BG MD Energy Community Contracting Parties AL EL Note: The location of projects is approximate and for illustration only. GIE, Sofia, 10 June 2016 CY 15

17 CBCA monitoring Findings (1/2) Agency CBCA Summary report.. The vast majority of the investment requests refer to projects located in one MS CBA methodologies» Project specific CBA calculations generally in line with ENTSOs (draft) methodologies» Shortcomings: calculation of benefits at cluster level only one scenario (in ele), lack of sensitivity analysis» NRAs carried out further work to validate the CBA results. The national net impacts based on CBA are generally positive => in the majority of cases, NRAs allocated the costs only to those MS which are hosting the project (territorial principle) GIE, Sofia, 10 June

18 CBCA monitoring Findings (2/2) Agency CBCA Summary report. Reasoning for allocating cost only to hosting countries:» Lack of net negative impact in the hosting country» lack of significant net positive impact (less than 10% of the total net positive impacts) in each of the non-hosting Member States.. Allocation of costs:» In most cases, 100% of the investment costs allocated» In some cases, partial allocation of the investment costs due to excessive increase in transmission tariffs, EU funds anticipated to fill the financing gap. ACER recommends 100% cost allocation and then assessment of transmission tariffs effects (no anticipation of EU funding).. Some decisions retained the NRAs right to revise the CBCA in case the funding from external sources will prove to be insufficient GIE, Sofia, 10 June

19 Thank you for your attention! Thank you for your attention