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Final stages in sight for Bulgarian balancing market – TSO

20 Jul 2012 15:39:37 | edem

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Regulated contracts for some energy suppliers are one reason for the delay in the Bulgaria's balancing market launch, transmission system operator (TSO) ESO has told ICIS.

Some balancing energy suppliers' contracts do not comply with free market principles, according to ESO.

"We also haven't decided how the renewable installations and the CHPs [combined heat and power] will fit into the new configuration and the balancing groups," an ESO spokeswoman said in a statement.

The TSO has developed and submitted its suggestions for amendments and additions of the trading rules, which recognise gaps in the current legislative order before the trading rules can be applied, to energy regulator DKER. ESO expects the suggestions to be approved soon.

Companies with a licence to coordinate balancing groups also must register with ESO. These registrations have not begun, but the TSO is ready to start the procedure.

Bilateral trade and liquidity

The balancing market is a precondition for the launch of Bulgaria's Day-ahead electricity exchange.

Bilateral trading represents about 9295% of the country's electricity trading market, with compulsory submission of hourly trading schedules. This market also has to start working with the balancing market in real time.

The TSO must secure a minimum level of liquidity on the platform. ESO is preparing a procedure for selecting a financial institution to manage the transactions for the deals struck on the exchange.

"In this sense, the deadline for the launch of the Day-ahead exchange depends on all those preconditions," the spokeswoman said.

The TSO is up against the EU's target of an integrated European market by 2014, but said in the statement that the start of the exchange is staged, only launching once all compulsory steps are in place.

Exchange delay

The launch's initial deadline was 1 July. Last week, Bulgarian traders said that market participants and companies were preparing for the launch. Sources speculated that the balancing market should launch by New Year's (see EDEM 15 May 2012 and 13 July 2012).

Bulgaria's deputy energy minister Evgeniya Haritonova said last month that Bulgaria was considering the possibility of connecting with the Romanian exchange, which is more suitable than the Greek pool exchange.

However, traders remained sceptical about the idea. They also pointed out that system testing was so far unsuccessful because market participants were not active (see EDEM 29 June 2012). IP

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