Dutch TSO to introduce gas day-ahead capacity conversion tool

20 June 2017 06:52 Source:ICIS
A natural gas pipeline in Venezuela

Dutch gas grid operator GTS aims to be the first system operator to offer a day-ahead capacity conversion service to prevent shippers paying twice for booked capacity, ICIS has learned.

The proposal will be welcome news to shippers, given that under current EU rules transmission system operators (TSOs) across Europe will only be required to offer the service on a monthly, quarterly and annual basis.

“It is … our intention to offer day-ahead capacity conversion starting 1 January 2018. As far as I know GTS is the only TSO willing to offer a day-ahead conversion,” a source at the TSO told ICIS.

GTS said it would need to use automated processing to deal with the requests, using its back-end systems and the PRISMA platform. It would also need to ensure conversion requests must be submitted before the auction.

“This race is not run yet. The two requirements have to be met before we can offer day-ahead conversion. We are optimistic but we are not there yet,” said the source.

CAM

TSOs will be required to offer the conversion service on a monthly, quarterly and annual basis by 1 January 2018, as part of an amended version of the EU’s capacity allocation mechanism (CAM).

Without the conversion service, firm capacity can only be sold as a bundled product that comprises entry and exit capacity on both sides of an interconnection point.

This is a problem for shippers that already own capacity on one side of an interconnection point, as they are unable to acquire the missing half of the entry/exit capacity pair by purchasing a bundled capacity product without double booking the capacity they already own.

Shippers and other industry players responded positively to the new requirement to offer a conversion service, but many said that would like to see this extend to short-term products.

GTS started to offer the capacity conversion service on a yearly, quarterly and monthly basis from 1 April, well in advance of the 2018 deadline. jack.elliott@icis.com

By Jack Elliott