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Secondary MarketSecondary Marketwith Transmission Capacitieswith Transmission Capacities
ČEPS, a.s.ČEPS, a.s.11/200611/2006
Initial situation
• Regulation 1228/2003 EC requires the member states to define
rules allowing the secondary market with transmission capacities
• Already supported in coordinated auction:
– self-service capacity transfers
– capacity notice-board
• Not sufficient for the market:
– no rules for secondary trading
– no products (complicates matching between bids and calls)
– no anonymous environment
– no financial settlement
– etc.
• No secondary market with capacities is operated in the region
Initial situation
• Opportunity for common Auction office and TSOs:
– AO and TSOs has data about entities and capacities
– shared financial guarantees for primary and secondary market can be
applied
– common invoicing for primary and secondary capacities can be applied
– auction office can automatically register the realized transfer
• Auction office has the best background for organizing secondary
market
– maximum added value for market participants in contrast to any other
solution
– market opportunity for TSOs participating in the project
Basic principles of continuous market
• Definitions:
– bid – supply of capacity
– call – demand for capacity
– orders – bids & calls
• Continuous evaluation of received orders
– Continuous matching of bids and calls
– Non-matched orders are inserted into wait list
Orders
• Period
• Offered/requested amount of capacity
• Requested/offered price limit
– not mandatory – if not specified, bid is “without
price limit” which means:
• order has priority during matching process
• order is matched with the counter-order with the best
price
Products
Orders
Price curves
Possible schedule
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Transaction settlement
• Transaction is announced to primary auction
office immediately after matching
• Financial transaction is recorded
• Individual accounts – sum of all:
– credits – payments for sold capacity
– debits – payments for bought capacity
Financial Balance