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EU capacity allocation rules by September 2012 - ENTSO-E

06 Dec 2011 15:04:08 | edem

The final network code for capacity allocation and congestion management for electricity (CACM) will be ready by September next year, the European association for electricity transmission system operators (ENTSO-E) confirmed at the Florence forum this week.

But the code will only focus on Day-ahead and Intra-day market harmonisation, while forward markets will be tackled at a later stage, ENTSO-E said.

After having received the official request by the European Commission to proceed with the network code (see EDEM 22 September 2011) - on the basis of framework guidelines drawn by the Agency for the Cooperation of Energy Regulators (ACER) earlier this year - ENTSO-E said that the final code will be submitted for public consultation in April next year.

Code contents

According to ACER's guidelines, intra-day markets across Europe should work on the basis of continuous implicit trading. The mechanism will allow for bids and offers to be matched whenever possible during the day with capacity and for power to be sold in one go.

Capacity available on the different European borders will be allocated through an EU-wide platform - the so-called capacity management module - that will provide real-time information on available transmission capacity.

The Day-ahead markets should also work on a implicit trading mechanism, but ACER's guidelines suggest that if liquidity is particularly strong, this could be implemented by regional auctions on some borders.

ACER also suggested that a number of transitional arrangements could be put in place in early 2012 before the final code is ready. Among those, there could be an early version of the capacity management module that could provide explicit access to the capacity for over-the-counter (OTC) trading and transmission system operator (TSO) balancing. Moreover, explicit intra-day allocation procedure should be put in place on all borders by the first quarter of 2012, ACER also said.

2014 target

The code could be insufficient to meet the target of the single European power market by 2014, previously set by the EU.

Speaking at the Emart conference in Lyon in November, ACER's power department head, Christophe Gence-Creux, said that regional initiatives should work in parallel with the network code in order to meet the deadlines.

"By 2014, I'm 100% sure that there will be price coupling between all the regions," Gence-Creux added, speaking about Day-ahead market coupling in Europe (see EDEM 23 November 2011). MM

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