Trading rules in LithuaniaTrading rules in Lithuania

Giedrius RadvilaLietuvos energija AB3 July 2006, Riga

II MINI-FORAII MINI-FORA

II MINI-FORA, 3 July 2006, Riga

LEGAL REGULATION OF ELECTRICITY MARKETLEGAL REGULATION OF ELECTRICITY MARKET

SEIMAS

GOVERNMENT

MINISTER OF ECONOMY

NATIONAL CONTROL

COMMISSION FOR PRICES AND

ENERGY

1. LAW ON ELECTRICITY

1. RULES OF PUBLIC SERVICE OBLIGATIONS

2. LICENSING RULES FOR OPERATIONS IN ELECTRICITY SECTOR

3. CONDITIONS OF ELECTRICITY IMPORT

1.1. TRADING RULES OF ELECTRICITY TRADING RULES OF ELECTRICITY

2.2. TRADING RULES OF ELECTRICITY AT AUCTIONSTRADING RULES OF ELECTRICITY AT AUCTIONS

3. GRID CODE

4. ELECTRICITY SUPPLY AND CONSUMPTION RULES

1. PROCEDURE FOR GRANTING THE STATUS OF ELIGIBLE CUSTOMER

2. METHODOLOGY FOR SETTING PRICE CAPS OF PUBLIC ELECTRICITY TARIFFS;

3. METHODOLOGY FOR SETTING PRICE CAPS OF TRANSMISSION AND DISTRIBUTION SERVICES;

4. PRICE REGULATION FOR MARKET PLAYERS COVERING MORE THAN 25 PERCENT OF MARKET

5. PRICE REGULATION PRINCIPLES FOR BALANCING ENERGY

6. RESOLUTIONS ON PRICE CHARGED FOR PUBLIC SERVICE OBLIGATIONS

II MINI-FORA, 3 July 2006, Riga

TRADING RULES OF ELECTRICITY

First edition – 18 of December 2001Second edition – 25 of February 2005Proposals for improvements are submitted to The Ministry of

economy 2006.

TRADING RULES AT AUCTIONS

Firs edition – 18 of April 2003Second edition – 25 of February 2005The final fulfillment of all provisions of the rules will be

performed after implementation of complete hourly trading framework.

CHRONOLOGY CHRONOLOGY

II MINI-FORA, 3 July 2006, Riga

Content:

Common provisions

Granting of market player status

Market operator

PTO

Planning of the trade

The balance settlement

Accounting

Final provisions

TRADING RULES OF ELECTRICITY TRADING RULES OF ELECTRICITY

II MINI-FORA, 3 July 2006, Riga

Common provisions:

Terms of reference

Main principals of the trading:fair competitionindependencereliability, fairnesssettlement supervisionequality in rights of market participants

TRADING RULES OF ELECTRICITY TRADING RULES OF ELECTRICITY

II MINI-FORA, 3 July 2006, Riga

Granting of market player status:

Required legal documentation for trading

Agreements with TSO and Market operator

Registration procedures by Market operator

TRADING RULES OF ELECTRICITYTRADING RULES OF ELECTRICITY

II MINI-FORA, 3 July 2006, Riga

Market operator:

Functions:

Registration

Settlement

Organization of the trade

TRADING RULES OF ELECTRICITYTRADING RULES OF ELECTRICITY

II MINI-FORA, 3 July 2006, Riga

TSO:

Functions:

Obligations to buy or sell electricity for –

covering technological losses

regulation and balancing

public service obligation

Information exchange

TRADING RULES OF ELECTRICITYTRADING RULES OF ELECTRICITY

II MINI-FORA, 3 July 2006, Riga

Planning of the trade:

Market players responsibilities regarding information submission

Weekly planning

TRADING RULES OF ELECTRICITYTRADING RULES OF ELECTRICITY

120

0

Bilateral trade information

1400

Wednesday before operational week

800

TSO receives bilateral trade information from market participants

Market participants have right to correct transactions and make confirmations for TSO

Week before operational week Operational week form Sunday 0000 till Friday 2400

TSO confirmations

Tuesday before operational week

Bilateral market information

II MINI-FORA, 3 July 2006, Riga

The balance settlement:

TSO provides commercial accounting data for Market operator until 2 days after the trading day

MO provides regulation and balancing information until 3 days after the trading day

MO performs balance settlement until 7 days after the trading month

TRADING RULES OF ELECTRICITYTRADING RULES OF ELECTRICITY

II MINI-FORA, 3 July 2006, Riga

Accounting:

Procedures

Accounting information

Accounting terms

TRADING RULES OF ELECTRICITYTRADING RULES OF ELECTRICITY

II MINI-FORA, 3 July 2006, Riga

Final provisions:

Exemptions before full implementation of hourly trading in the consumption side

70% of consumption trade under a bilateral manner

obligations for suppliers to buy “public service obligation” electricity

The principal of the balancing electricity price setting

TRADING RULES OF ELECTRICITYTRADING RULES OF ELECTRICITY

II MINI-FORA, 3 July 2006, Riga

TRADING RULES AT AUCTIONSTRADING RULES AT AUCTIONS

II MINI-FORA, 3 July 2006, Riga

Content:

Common provisions

The organization of the uninterruptible trade session

The regulation auction

Final provisions

TRADING RULES AT AUCTIONS TRADING RULES AT AUCTIONS

II MINI-FORA, 3 july 2006, Riga

1. Internal regulation of electricity market players actions

2. Intentions:

development of market players relations

attraction investments to the energy sector

regulation of the electricity market activities

introduction of commercial accounting system

3. Definitions of terms

4. Preconditions of the participating at auctions

TRADING RULES AT AUCTIONS - TRADING RULES AT AUCTIONS - Common provisions

II MINI-FORA, 3 July 2006, Riga

1. Timing

TRADING RULES AT AUCTIONS - TRADING RULES AT AUCTIONS - The organization of the uninterruptible trade session

Bilateral trade

Two month – 1 day before 140

0

Uninterruptible trade

Operation day

1600

Operation hour

2 hours

Balance settlement

800

1 day before

operational day

800 160

0

2 day before

operational day

Regulation energy and reserve capacity information

Correction of regulation energy and reserve capacity bids information

II MINI-FORA, 3 July 2006, Riga

TRADING RULES AT AUCTIONS - TRADING RULES AT AUCTIONS - The organization of the uninterruptible trade session

2. Market information

3. System price formation mechanismAuctionAuction

System priceSystem price x 1,2 = balancing energy (+) price

ct/kWh

kWh

Average weighted price of transactions

(System price)

System price x 0,8 =balancing energy (-) price

Offers to buy

Bids to sell

Bids not accepted by the auctionbecause offer prices exceed bid prices !!!!!!

Bids accepted by the auction !!!!!!

Regulation energy auctionRegulation energy auction

Average weighted price of

regulation energy transactions

UPWARD

DOWNWARD

II MINI-FORA, 3 July 2006, Riga

TRADING RULES AT AUCTIONS - TRADING RULES AT AUCTIONS - The regulation auction

1. Requirements for participating at the regulation auction

2. The regulation auction information

3. The realization of the regulation

bids

4. Delegation of TSO regarding regulation

Trading day: <yyyy-mm-dd>Trading hour: <hh-hh> Current time: <yyyy-mm-dd hh:mm:ss>

Par

tici

pan

t

Regulation capacity

Regulation energy price

Sp

ecif

icat

ion

o

f b

id Capacity amount for

payment

Capacity price

MW Lt/MWh MW Lt/MW

VE 5 120.00 N 8.44

KE 15 80.00 N 8.45

ME 10 79.00 N 10 8.45

VE 10 56.00 N 10 8.45

ME 5 55.80 N 5 8.45

KE 10 55.63 N 10 8.45

LE 5 55.60 L 5 8.45

VE 10 52.00 N

KE 20 50.00 L

ME 15 49.00 N

VE 30 42.00 L

LE 10 40.00 L

MW

Upward-regulation bids. Increase in generation/reduction in consumption

PriceLt/MWh Downward-regulation bids.

Reduction in generation/increase in consumption

TSO will take the most expensive down-regulation for the certain amount of power

II MINI-FORA, 3 July 2006, Riga

Thank You for attention...Thank You for attention...