WG EU market design & system
operations
European Market Design
• Intraday market design on Nemo Link (BE-GB)
• Introduction of explicit ID auctions (4 auctions, each covering 6 hours)
• Expected go-live before the end of the year – subject to uncertainties
• Decoupling incident on 7/06 (by EPEX spot)
• Belgian approach for the CEP 70% requirement => see next slides
• No action plan
• Derogation for loop flows and long duration outages – under consideration for a parallel run
• Long-term capacity calculation and splitting rules methodology: summary of the approach in Core to support consultation
process
• In the meantime: Core TSOs fail to agree on the methodology – EC should now facilitate the processµ
System Operations
• Emergency & restoration: list of SGU, Defense Plan and Restoration Plan.
2
• Elia, CREG and BE ministry concluded before the summer that there is no need for an action plan
since BE is not facing structural congestions
• Elia does see a need for a derogation for 2 reasons:
• High loopflows that cannot be contained due to methodological limitations (no Core
CCM, no coordinated RD&CT with cost sharing) and likely action plans elsewhere
(confirmed for Germany) externalities
• Long duration outages (in particular for replacing conductors) where 70% may not be
achievable despite internal redispatching, due to temporarily weakened grid. The
SPAIC process creates transparency about the potential impact.
• The cornerstones of this approach have been presented to Belgian market parties in June
• While the underlying drivers are expected to remain present in the foreseeable future (until all
Core methodologies are in place and the action plan of other countries are implemented), the
derogation will be for 1 year only in order to enable a “learning-by-doing” approach.
3
CEP 70% - Belgian approach
• The derogation will be in the form of a methodology (including both principles and formulas).
This methodology will be applied on a daily basis, fully integretated in the capacity calculation,
in order to set the appropriate level of ambition in terms of minRAM inclusion.
• As opposed to a “value-based” derogation where the minRAM values would be (roughly) set ex-
ante in the derogation, the methodological approach allows taking assumptions as late as
possible (remaining assumptions in D-2 are of much better quality than year ahead), therefore
avoiding over-shooting (more efficient) the extent of the derogation.
• This methodological approach also allows being robust with respect to the approach chosen by
other countries. No specific coordination with other countries is required
• E.g.: if the loopflows are below the acceptable threshold on one particular day and/or
one particular branch, the effect of the derogation will be void
4
CEP 70% - Belgian approach
• Other points relevant to CEP implementation:
• Elia intends to consider all non-CCR flows (including third country flows) with a
forecast approach to compute the resulting minRAM to be offered within CWE, in line
with current practices and ACER recommendation.
• A minimum capacity of 20% for CWE exchanges will be offered anyhow, in line with
current approved methodology and practices.
• Short term outages (typically maintenance) and other situations where the level of
ambition of the CEP could not be reached despite usage of internal redispatching will
be justified towards CREG as input for their annual compliancy assessment.
• Next steps:
• Intention to submit derogation beginning of October together with other CORE TSOs
• ECBC Sep 30 with intention to create transparency on EU level on countries’ approaches
• Ongoing implementation in operational processes (challenging)
5
CEP 70% - Belgian approach
• Under consideration: having an external parallel run for e.g. 6 months at the beginning of 2020
• This would be part of Elia derogation.
• Justification would be be grounded on operational security (in line with Electricity
Regulation Art. 16.9) due to the usage of many new tools and processes (non-
industrialised) which would not have been fully tested due to limited time.
• The methodological derogation approach applied by Elia entails a higher complexity,
hence a risk that can be higher than for other TSOs.
• Aiming at 70% except in specific situations is by nature more challenging for system
operations than relying on an action plan.
• Besides the legal justification in accordance with Electricity Regulation, Elia is of the opinion that
a parallel run can provide some foresight to the market participants about the expected market
evolutions. This was valued in the past by market participants, e.g. for CWE flow-based go-live.
• Even though CWE is not formally a CCR, our legal interpretation is that we are also bound by
CACM Art. 20(8) on top of the CEP regulation requirements.
To enable market participants to adapt to any change in the capacity calculation approach, the TSOs
concerned shall test the new approach alongside the existing approach and involve market participants for
at least six months before implementing a proposal for changing their capacity calculation approach. 6
CEP 70% - Belgian approach
Feedback WG Balancing
• Volumes 2020
• Status New aFRR design
• Status offshore storm risk
• Status FCR
• Status mFRR
Topics
8
Regulatory framework Volumes 2020
9
2018
2019
2020
Dossier Volume 2018-> explain methodology for needs
-> determination of needs
-> determination of means
Dossier Volume 2019-> explain methodology for needs
-> determination of needs
-> determination of means
#N/A#
LFC BOA 2019-> explain methodology for needs
-> determination of needs
#N/A#
LFC BOA 2020-> explain methodology for needs
-> determination of needs
Means document 2020-> explain methodology for means
-> determination of means
#N/A#
#N/A#
Q3 2019 consultation by Elia
Q4 2019: decision CREG
Expectations regarding contracted volumes
10
2019 Applicable volumes
Upwards Downwards
aFRR: 145 MW aFRR: 145 MW
mFRR: 844 MW mFRR: 0 MW
2020 expectations
• No mFRR down will be contracted
• Similar volumes of aFRR and mFRR up will be contracted
Disclaimer: Volumes on this slides are indicative. Final volumes can only be communicated
after decision CREG
aFRR design; open points
11
New proposal capacity tender methodology: Step 1 @ D-2: independent total cost optimization for the 24-hour block for aFRR up and aFRR down
together (e.g. 140MW)
Step 2 @ D-1: a merit order selection for upward and downward reserves separately and pure divisible 4-hour
bids (e.g. 5 MW)
Rules to gradually increase volumes selected via step 2 in case of low prices in step 2 and sufficient available
volumes
New proposal regarding a ‘moving’ price cap (1000 €/MWh) and the application of
‘weighted average imbalance pricing ‘ with respect to aFRR activation prices in
order to mitigate balancing risks
Both proposals were positively received by all members of the WG Balancing
WORKSHOP on aFRR Monday 23/09 to present/discuss final details
Offshore integration - status
• Public consultation of T&C BRP • User manual of the storm tool
Specific workshop to detail results of storm forecast test period, define procedure parameters and present improvements of the model
Q2
Q3
• Publication of Update of the design note based on feedback from 12/06 workshop
• Feedback on WG bal.
12
12th June
End of June
July-August
November
Last improvements of the storm forecast model (calibration with historical data, integration of new technologies of wind parks)Continuation of the retro-analysis of the model accuracy on past winters
End August September
Go-live of the storm procedureQ4
FCR – Planning and next steps
13
Design note integrating the received feedback is available on Elia website
Next step: T&C BSP FCR
FCR evolution planning
Regional Procurement
Weekly Daily
Local Procurement
Weekly
• Feb. 2019 new design
• Daily tendering (6*4h) and merit order selection
• contractual merge, indivisibility energy bid, paid as cleared, ToE (passed through)
• T&C
• September 9th; start informal consultation stakeholders (share document)
• September 23th : Workshop
• September 24th deadline feedback informal consultation
• Public consultation by Elia: October 4th -> November 4th
• End December: decision CREG
Status mFRR
14
Implementation project iCaros–State of Play
Public Consultation - focus on translating current design (focus PGM ≥
25 MW) to new roles and responsabilities specified in SOGL (not in line
with iCAROS design) - submission end Oct 19
16
1. Timing : 16/09 until 16/10/2019
2. Two // public consultations
– A public consultation regarding the Terms and Conditions for Outage Planning Agent
(T&C OPA), Terms and Conditions for Scheduling Agent (T&C SA) and the Rules for
Coordination and Congestion Management.
– A public consultation regarding the general conditions that will apply for the Terms
and Conditions for all ancillary services.
Terms & Conditions OPA / SA
General Terms and Conditions
for Ancillaries and Grid Losses
CIP
U C
on
tra
ct
CIP
U O
ffs
ho
re
Co
ntr
ac
t
Specific Conditions
OPA
General Conditions
Contract OPA
Annexes (incl. Party
specific information)
Non-regulated ContractsRegulated Contracts
T&C OPA
Specific Conditions
SA
General Conditions
Contract SA
Annexes (incl. Party
specific information)
T&C SA
Transposition of current CIPU Contracts rules and obligations to new Contracts OPA andContracts SA in line with the roles and responsabilities set in SOGL
No change of the AS IS procedures, Elia tools or IT connections to the Elia tools
2019 2020
jun jul aug sept oct
Alignment with CREG
Presentation package external stakeholders (direct clients)- 25/09
Presentation package external stakeholders (DSOs)- 23/09
Rewording based on input collected from public consultation
Planning Public Consultation - focus on translating current design (focus PGM ≥ 25 MW) to
new roles and responsabilities specified in SOGL (not in line with iCAROS design) -
submission end Oct 19
Public consultation- period of one month in accordance to article 11 of SOGL
25/10 Submission
V1 Elia -> CREG
6 months after entry into force of Federal Grid Code27/04 Federal
Grid Code entry
into force
CREG decision
may
- Coordination Rules
- Terms & Conditions Outage Planning Agent
- Terms & Conditions Scheduling Agent
Task Force
Capacity Remuneration Mechanism
CRM framework law voted in parliament on April 4th
Since Easter 5 design workshops :
Different design proposals presented by Elia, CREG and FPS Economy
Feedback from stakeholders (specific presentations and Q&A) much appreciated
According to the governance foreseen in the law :
Elia’s scope : 2 public consultations organised on 7 design notes
Batch 1: 13.09.2019 – 11.10.2019
Batch 2: 02.10.2019 – 30.10.2019
CREG and FPS Economy will launch consultations on their topics in the near future
Goal: official notification to the European Commission by 19 December 2019
alternative proposals in case of
disagreement are welcomed
Pre-Auction Auction(Y-4 and Y-1)
Between Auction & Delivery
Capacity Payment
Payback Obligation (Reference Price > Strike
Price)
Availability Obligation
Availability Monitoring &
Penalties
Capacity Auction (Y-4 and Y-1) :
Monitoring of Investments
Secondary Market
XB participation
Capacity Contract
Design Note 2:Intermediate price cap
Auction parameters
- Intermediate Price Cap
Design Note 1: De-rating& input for volume determination (Elia’s part)
- De-ratings
- Inputs for Demand Curve
Design Note 3: Prequalification & Monitoring
Design Note 4: Auction Process
Design Note 5: Payback Obligation
Design Note 6: Availability Requirements &
Penalties
Design Note 7 : Secondary Market
- Strike Price
- Reference Price
Pre-qualification
- Pre-qualification Process
- Aggregation
- Opt-Out
- De-ratings
- Minimum Threshold, Investment Threshold, Cumul
Phase I Consultation 13/09 – 11/10
Phase II Consultation 2/10 – 30/10
In the coming weeks, a set of CRM design notes will be made public by Elia for market consultation. Topics not in scope are covered by FPS Economy/CREG.
Delivery year Y (or longer in case of multi-year
contracts)
Capacity Product
2020
Jun Jul Aug Sep Oct Nov Dec
TF CRM
Jun 13
TF CRM
Jul 9
TF CRM
Sep 5
TF CRM
Sep 26
TF CRM
Oct 22
TF CRM
Nov 12
TF CRM
Nov 21
TF CRM
Dec 13
Submission to EC
Dec 19
KB Methodology – Elia (Part I)- Derating- Intermediate Price Cap
KB Methodo – CREG- Demand Curve
M
Market Rules – Part 2- Auction Algorithm- Grid Feasibility- Opt-Out- Secondary Market- Transparency- Prequalification- Monitoring + Settlement
Market Rules – Part 1- Availability Requirements - Availability Penalties
Drafting Design Note + draft KB (Part I)
Public Consultation Design note part 1
AnalysefeedbackDrafting design Note MR part 1
Submission to Elia/FPS for advice
Public Consultation Draft/Final decision ?
Public Consultation Design note part 2
Analysefeedback
Drafting Design Note MR part 2
Final draft
MR
CdSfeedback
Final draft Market Rules
Implementation plan
Consultation Neighbours
KB investmest levels/Cost - CREG
KB Min threshold/cumul support - FPS
KB Controls - FPS
KB Financing - FPS
Drafting
Submission to Elia for adviceDrafting + public Consultation – draft/final decision Final version
Drafting + public Consultation (stakeholders & regions)
Subm to Elia/CREG for advice
Final version
Drafting Subm to Elia/CREG for advice Final version
Redaction Contract/TranslationMR
Dec 20
Read FR/NL translationsJan 20
Start public consult
Jan 31
End public constation
Mar 1
Analysefeedback and Consultation report
Apr 1
Submission to EC + CREG
Apr 1
Oct 15
drafting consultation report
EC notification file Drafting CdS
Final version
20192019
Final version
Public Consultation Design note + draft KB
Analaysefeedback and ConsultationReport
Submission to CREG/FPS for advice
Final version KB methodo
//
Consultation Neighbours
CdS
CdS
KB XB - FPS Drafting + public Consultation
Submission EC
Final version
Drafting
KB Methodology – Elia (Part II)- Strike & Reference Prices
Drafting Design Note + draft KB (Part II)Public Consultation Design Note + draft KB
Analysefeedback
CREG/FPS for advice