Bulgaria’s electricity balancing market needs more testing - lobbies

12 February 2014 10:58 Source:ICIS

Bulgarian renewable producers are asking for more testing of the future balancing market. If approved, this would mean further delays for the long-awaited launch.

Currently energy regulator DKER is holding public discussions on proposed changes to the country’s electricity trading rules which were adopted in late July 2013 but never fully put into practice. Most of the changes relate to the balancing market rules.

Even though testing of the balancing market started in October 2011, renewable producers have not been sending hourly testing production forecasts yet, according to the Bulgarian Photovoltaic Association (BPVA).

This is one of the reasons why the lobby group has asked energy regulator DKER for an additional six months of testing in a letter to the regulator, seen by ICIS.

The balancing market needs more testing because the methodologies of the four specialised balancing groups, coordinated by state-owned utility NEK and the three private distributors and end suppliers which would include some renewable producers, are all different, a BPVA spokeswoman said in an emailed statement on Tuesday afternoon. It is unclear how these were approved, she said.

In addition, grid operator ESO is yet to give specific instructions for the work of the market. The absence of developed market mechanisms because of the lack of an exchange is also an issue, BPVA said.

The Bulgarian Wind Energy Association (BGWEA) also supports a testing period of at least one year to build up data, a spokeswoman for the association said in an email also on Tuesday.

DKER and ESO did not respond to calls for comment. Power traders active in Bulgaria doubt however the regulator will approve a longer testing period, saying enough has been done to make the launch possible.

Choosing balancing coordinator

Both associations are also lobbying for a free choice of coordinator of a balancing group.

“We do not favour the current provision in the trading rules which says that if a renewable energy producer does not specifically appoint a combined balancing group they wish to join, then they would be obliged to join the specialised balancing group of the respective end supplier,” BGWEA said,

This would create territorial limitations for the renewable producers and it will negatively affect the possibilities for offsetting imbalances within the group.

20% forecast deviation

The renewable producers are also asking for 20% leeway between their production forecasts and actual production without facing penalties for imbalances.

According to BGWEA this is reasonable considering there is no intra-day market in Bulgaria and current trading rules do not take into account how wind producers do forecasts.

The 20% figure was calculated on the basis of an average of errors when forecasting electricity production form wind and solar, according to BPVA.

There is no deadline yet when a decision on the proposed changes will be made.

Traders speaking to ICIS hope Bulgaria’s long-overdue balancing market is going to launch soon, after DKER urged renewable producers to sign contracts with the coordinators of balancing groups by the end of January ( see EDEM 21 January 2014 ).

Last week it emerged that additional registration procedures with ESO were needed before the market can start ( see EDEM 5 February 2014 ). Irina Peltegova

By Irina Peltegova