Sin ttulo de diapositiva

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EuroPEX ACTIVITIES
Maria Luisa Huidobro President of the Steering
committee
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EuroPEX ACTIVITIES

• CREATION OF EUROPEX MANDATE FROM THE APEX
  STEERING COMMITTEE.
• COMMUNICATION TO EUROPEAN UNION AUTHORITIES.
• FLORENCE FORUM.
• LISBON CONFERENCE.
• PUBLIC HEARING OF THE EUROPEAN UNION ON INTERNAL
  MARKET DEVELOPMENT.
• MEETINGS WITH ETSO AND EFET.
• STEERING COMMITTEE MEETING.
• CONGESTION MANAGEMENT.

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MANDATE FROM THE APEX STEERING COMMITEE

• CREATE A EUROPEAN BRANCH OF THE APEX ASSOCIATION,
  NAMED EUROPEX, JANUARY 19, 2000.
• COMMUNICATION TO THE E.U. FEBRUARY, 2000.
• COMMUNICATION TO ESTO, MARCH 15, 2000.
• COMMUNICATION TO THE FLORENCE FORUM.
• PREVIOUS TO THE CONSTITUTION OF EUROPEX
  23-11-99.
• OFFICIAL PRESENTATION MARCH, 29, 2000.
• MANAGEMENT BODIES.
• STEERING COMMITTEE FORMED BY THE CEOS OF THE APEX
  EUROPEAN MEMBERS COOPERATING POWER EXCHANGE.
• STEERING COMMITTEE ASSISTED BY TWO
  REPRESENTATIVES.

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MAIN TASKS OF EUROPEX

• TO PROMOTE THE ROLE OF POWER EXCHANGES AS A WAY
  OF INCREASING COMPETITION AND IMPLEMENTING THE
  EUROPEAN SINGLE ELECTRICITY MARKET.
• TO FOLLOW UP THE LIBERALISATION OF THE DIFFERENT
  EUROPEAN ELECTRICITY SYSTEMS.
• TO DEAL WITH THE ISSUE OF INTERNATIONAL TRADING,
  WITH SPECIAL EMPHASIS ON PROVIDING A MARKET
  SOLUTION TO THE CONGESTION PROBLEMS.
• TO START A DIALOGUE WITH THE EUROPEAN COMMUNITY
  AUTHORITIES, AND WITH OTHER EUROPEAN ELECTRICITY
  RELATED ENTITIES SUCH AS ESTO (EUROPEAN
  TRANSMISSION SYSTEM OPERATORS), EFET (EUROPEAN
  FEDERATION OF ENERGY TRADERS), ETC
• TO INCREASE COOPERATION BETWEEN EUROPEAN POWER
  EXCHANGES AND TO PROMOTE FREE TRADING.
• TO ASSESS THE NEED FOR RECOMMENDATIONS REGARDING
  MARKET INFORMATION DISSEMINATION AND MARKET
  RULES, ESPECIALLY RELATED TO MARKET POWER ABUSE.

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ACTIVITIES OF EUROPEX

• FLUENT RELATIONSHIPS WITH ETSO AND EFET.
• 5 MEETINGS OF THE STEERING COMMITTEE.
• 3 COMMUNICATIONS TO THE EU.
• PARTICIPATION IN THE PUBLIC HEARING OF THE EU ON
  THE COMPLETION OF THE INTERNAL ENERGY MARKET.
• EuroPEX WORKING PAPER ON CONGESTION MANAGEMENT

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EU STATES ELECTRICITY LIBERALIZATION STATUS

• EU DIRECTIVE TRANSPOSED FOR ALL MEMBER STATES.
• REDUCED INTERSTATE COMMERCIAL ELECTRICITY
  EXCHANGES.
• LIMITATIONS TO NETWORK FREE ACCESS.
• DIFFERENT ELECTRICITY MARKET OPENING TO QUALIFIED
  CONSUMERS.
• TREND TOWARDS THE ESTABLISHMENT OF ORGANIZED
  MARKETS.

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EUROPEAN COMMISSIONS XXVIII REPORT ON
COMPETITION POLICY

• ELECTRICAL INTERCONNECTIONS BETWEEN THE MEMBER
  STATES WILL PLAY AN IMPORTANT ROLE IN THE
  CREATION OF A SINGLE MARKET OF ELECTRICITY.
• PANCAKING WHEN REFERRED TO THE SUM OF
  TRANSMISSION COSTS RESULTING FROM THE USE OF
  SYSTEMS BELONGING TO SEVERAL OPERATORS.
• CUSTOMERS FREEDOM OF CHOICE, LIMITED AS A
  CONSEQUENCE OF THE INTRODUCTION OF EXCLUSIVE OR
  LONG TERM CONTRACTS. UTILITIES OPERATING IN THE
  ELECTRICITY MARKET WILL ADAPT THEIR COMMERCIAL
  PRACTICES TO THE NEW FRAME CREATED BY THE
  DIRECTIVE. CLAUSES OF OLD CONTRACTS COULD BE
  REACHED BY OTHER METHODS, LESS RESTRICTED OF THE
  COMPETENCE.
• GUARANTEES TO BE GIVEN REGARDING SYSTEM ACCESS
  AND FREEDOM OF CHOICE FOR CUSTOMERS WILL NOT
  SERVE THEIR INTENDED PURPOSE UNLESS ELECTRICITY
  IS PROVIDED BY A SUFFICIENT NUMBER OF SUPPLIERS.

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REASONS FOR THE OBSTACLES TO COMMERCIAL EXCHANGES

• WIDELY DIFFERENT LEVELS OF DEREGULATION AND
  MARKET OPENING IN EU MEMBER STATES.
• LIMITED COMMERCIAL CAPACITY.
• THE TECHNICAL MANAGEMENT OF ELECTRICITY SYSTEMS
  REQUIRES ADAPTATION TO DEVELOP THE INTERNAL
  MARKET.
• MULTIPLE PAYMENTS FOR THE USE OF GRIDS
  (PANCAKING).
• LONG-TERM CONTRACTS.
• LACK OF EU-WIDE HARMONISATION OF MATTERS
  AFFECTING COMMERCIAL CAPACITY AND THE MANAGEMENT
  OF INTERCONNECTED ELECTRICITY SYSTEMS.
• LIMITED RECOGNITION OF ORGANISED MARKETS WITHIN
  THE EU.

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EuroPEX POSITION REGARDING Available Transmission
Capacity (ATC)

• EUROPEX BELIEVES THE TSOS SHOULD BE RESPONSIBLE
  FOR PROVIDING ATC WHILE MARKET PARTICIPANTS
  SHOULD BE ALLOWED THE FREEDOM TO DETERMINE HOW IT
  IS USED.
• TO ENABLE OPTIMAL TRADING, THE PARTICIPANTS NEED
  TO BE CONFIDENT OF THE TERMS ON WHICH IT WILL BE
  AVAILABLE. THIS REQUIRES THAT TSOS MAKE CAPACITY
  AVAILABLE ON A FIRM BASIS WITH SUFFICIENT
  LEAD-TIME FOR PARTICIPANTS TO USE IT EFFICIENTLY,
  AND THAT FULL INFORMATION ON AVAILABILITY IS
  PUBLISHED BY THE TSOS.
• CAPACITY IS IN SOME PLACES SCARCE AND HENCE
  VALUABLE. EUROPEX BELIEVES THAT TSOS SHOULD BE
  INCENTIVISED TO MAXIMISE THE CAPACITY AVAILABLE.
  INITIALLY, THIS MAY BE THROUGH REGULATION, BUT
  EUROPEX BELIEVES THAT APPROPRIATE ECONOMIC
  INCENTIVES SHOULD BE DEVELOPED. THIS SHOULD ALSO
  FACILITATE EFFICIENT LONG-TERM INVESTMENT.
• IF THE TSO WISHES TO CURTAIL ATC, AFTER IT IS
  MADE AVAILABLE ON A FIRM BASES, IT SHOULD
  COMPENSATE THE PARTICIPANTS IMPACTED. IN A
  POOL-BASED SYSTEM THIS MIGHT REQUIRE THE TSO
  UNDERTAKING COUNTER TRADES TO REDUCE THE FLOW IN
  A BILATERAL-BASED SYSTEM THIS MIGHT REQUIRE THE
  TSO TO BUY BACK THE CURTAILED RIGHTS.

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FLORENCE FORUM CONCLUSIONS MARCH 30/31 2000 (I)

• CROSS BORDER TARIFICATION (NETWORK ACCESS IN
  THE EUROPEAN CONTEXT)
• Agents will pay the network access tariffs
  established in each state.
• There will be a compensation between networks.
• Export networks will pay money.
• Transited networks will earn money.
• Each state will define how he will collect the
  money. (Harmonized by the EU).
• Costs to be recuperated by all networks are
  defined as a lump sum to be justified to the
  National regulators, member states and EU
  authorities.
• Once agents pay the access tariffs their
  electricity will circulate free through the
  network, except for congestion problems.
• Harmonizing the proportions between the G and L
  terms of the network access.

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EuroPex POSITION REGARDING CROSS BORDER TARIFFS

• THE COLLECTION OF THE MONEY SHOULD BE IN THE FORM
  OF AN ADDITIONAL COMPONENT OF THE GENERAL GRID
  POINT OF ACCESS TARIFF. THERE WILL NOT BE ANY
  KIND OF DISCRIMINATION ASSOCIATED WITH THE USE OF
  THE ELECTRICITY, OR RELATED TO THE ORIGIN OR
  DESTINATION OF THE ELECTRICITY, PAYING ALL THE
  ELECTRICITY THE SAME GRID ACCESS TARIFFS IN EACH
  STATE.
• THE COST COMPONENT SHOULD BE VERY SIMPLE TO
  COMPUTE.
• THE AMOUNT OF MONEY CHARGED DUE TO THIS CONCEPT
  IN THE DIFFERENT STATES SHOULD BE HARMONIZED, IN
  ORDER NOT TO DISTORT INTERNATIONAL TRADING OF
  ELECTRICITY.
• THE NEW CHARGES SHOULD ALSO BE APPLIED TO
  HISTORIC AND LONG TERM CONTRACTS THAT SHOULD NOT
  BE FAVORED AGAINST NEW ONES.
• ELECTRIC ENERGY, ONCE THE GRID ACCESS TARIFF IS
  PAID IN THE STATE OF ORIGIN (G TERM) AND
  DESTINATION (L TERM) SHOULD BE TREATED IN THE
  STATE OF ORIGIN, IN THE STATE OF DESTINATION AND
  IN ANY INTERMEDIATE STATE AS ANY OTHER DOMESTIC
  ELECTRIC ENERGY.

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FLORENCE FORUM CONCLUSIONS MARCH 30/31 2000 (II)

• Congestion management
• TSOs will publish the ATC
• The EU has requested clarifications regarding the
  calculation basis
• Separation of the commercial interest between the
  network management an commercial interest of the
  rest of the agents
• Congestion management should be based on market
  mechanisms
• The solution for each particular congested point
  will be discussed by the two neighboring countries

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EuroPEX POSITION REGARDING CONGESTION MANAGEMENT

• CONGESTED INTERCONNECTORS CLEARLY HAVE ECONOMIC
  VALUE, WHEN ACTUAL DEMAND EXCEEDS PHYSICAL
  CAPACITY. ETSO PROPOSES A MECHANISM TO PREVENT
  CONGESTION IN ADVANCE, BUT THIS WILL NOT REVEAL
  WHERE A REAL CONGESTION EXISTS. THIS WILL
  FRUSTRATE AND WEAKEN INTERNATIONAL TRADING.
• AN ADMINISTERED APPROACH TO RATIONING ACCESS WILL
  NOT LEAD TO THE OPTIMAL USE OF THIS SCARE
  RESOURCE. A METHOD IS REQUIRED WHICH ENABLES THE
  CAPACITY TO BE USED BY THE PARTICIPANT WHO VALUES
  IT MOST I.E., ON A MARKET BASIS.
• ONE METHOD, WHERE POOL BASED MARKETS EXIST,
  RECOMMENDED BY EUROPEX, IS MARKET SPLITTING BASED
  IN THE METHOD USED BY NORDPOOL, WHICH ALLOCATES
  TRANSMISSION CAPACITY BASED ON THE ENERGY BIDS.
  THE METHOD USES PARTICIPANTS ENERGY BIDS TO
  RATION ACCESS, AND THIS APPROACH IS ALSO USED TO
  ALLOCATE THE ATC BETWEEN THE AREA WHERE THE
  MARKET OPERATES AND OTHER AREAS, OR WITHIN THE
  AREA ITSELF, LIKE IN NORDPOOL.
• ANOTHER METHOD, RECOMMENDED BY EUROPEX FOR
  SYSTEMS BASED ON NEGOTIATED BILATERAL CONTRACTS,
  IS TO GRANT OR AUCTION TRANSMISSION RIGHTS ACROSS
  NON CONGESTED TRANSMISSION FLOW GATES, THIS
  RIGHTS CAN BE TRADED BETWEEN PARTICIPANTS.

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EuroPex POSITION REGARDING CONFIDENTIALITY OF
COMMERCIAL INFORMATION

• CONFIDENTIALITY IS VITAL IN ORDER TO PROVIDE
  CONFIDENCE IN THE TRADING ENVIRONMENT. POWER
  EXCHANGES SHOULD BE ABLE TO PRESENT INFORMATION
  ON TRANSACTIONS ON BEHALF OF THEIR PARTICIPANTS
  ON AN AGGREGATE AND ANONYMOUS BASIS.

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EuroPEX POSITION TO BE PRESENTED TO THE PUBLIC
HEARING ON THE COMPLETION OF THE INTERNAL ENERGY
MARKET ON 14th SEPTEMBER
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QUESTION 1 ACCELERATION OF THE LIBERALISATION OF
THE INTERNAL ELECTRICITY

• TO COMPLETE THE LIBERALISATION ALLOWING ALL
  CONSUMERS TO SELECT THEIR ELECTRICITY SUPPLY
  COMPANY
• TO ESTABLISH A EUROPEAN HARMONISED SYSTEM OF
  TARIFFS FOR THE USE OF THE NETWORKS
• TO ESTABLISH COMMON PROCEDURES FOR CROSS BORDER
  CONGESTION MANAGEMENT
• TO ESTABLISH, AT THE EUROPEAN LEVEL, HARMONISED
  BALANCING POWER RULES, SECURITY STANDARDS AND
  ELECTRIC SYSTEMS TECHNICAL MANAGEMENT PROCEDURES
  FOR ELECTRICITY EUROPEAN EXCHANGES
• TO PROMOTE, AT THE COMMUNITY LEVEL, NEW
  INVESTMENT AND MEASURES THAT MAKE POSSIBLE A
  GROWING AVAILABLE CAPACITY FOR EUROPEAN
  ELECTRICITY EXCHANGES
• A COMMON AND EFFICIENT SOLUTION FOR LONG TERM
  CONTRACTS AND COMPROMISES SHOULD BE IDENTIFIED
  AND APPLIED IN EQUAL TERMS TO ALL MEMBER
  COUNTRIES, IN A WAY THAT COMPETITION IS
  ENCOURAGED

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QUESTION 2 PUBLIC SERVICE OBLIGATIONS

• FREE MARKET AND LIBERALISATION CONTRIBUTE ALSO TO
  THEM.
• SECURITY OF SUPPLY, ORGANISED MARKETS AND FREE
  TRANSACTIONS ARE AN INCENTIVE TO MAINTAIN
  GENERATION PLANTS OPERATIVE
• THE INCREASE OF COMMERCIAL CAPACITY BETWEEN
  ELECTRICAL SYSTEMS INCREASES ALSO THE CAPACITY
  RESERVE OF A SYSTEM AND THUS ITS SUPPLY SECURITY
• THE NEW PROJECTS TO INSTALL COMBINED CYCLES OF
  NATURAL GAS AND RENEWABLE PLANTS
• SECURITY STANDARDS AND QUALITY OF SUPPLY SHOULD
  BE SUBJECTED TO HARMONISED REGULATION
• COMPATIBLE INCENTIVES TO RENEWABLE ENERGIES WITH
  MARKET MECHANISMS

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QUESTION 3 SOCIAL EFFECTS OF LIBERALISATION

• AN EFFICIENT ENERGY SYSTEM IS A BIG INCENTIVE TO
  ACCELERATE EFFICIENCY IN OTHER ECONOMIC SECTORS
  AND THUS FOR EMPLOYMENT INCREASE
• THE ENERGY SECTOR SHOULD NOT BE CONSIDERED AS A
  DIRECT SOURCE FOR EMPLOYMENT INCREASE
• THE LIBERALISATION PROMOTES EFFICIENCY AND GIVES
  NEW OPPORTUNITIES TO CREATE SERVICE COMPANIES
• TO ELIMINATE CONSTRAINTS, SUCH AS THE TREATMENT
  GIVING TO SOME NATIONAL COAL CONTRACTS, OR THE
  INCORRECT TREATMENT OF INCENTIVES FOR THE NEW
  RENEWABLE ENERGIES, IN BETWEEN OTHERS, CAN BE IN
  THIS RESPECT VERY POSITIVE FOR INCREASING
  EFFICIENCY AND REACHING THE FULL BENEFITS FROM
  LIBERALISATION

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QUESTION 4 OPENING OF THE MARKET ELIGIBLE
CUSTOMERS

• A DATE SHOULD BE ESTABLISHED, AT THE COMMUNITY
  LEVEL, TO FULLY LIBERALISE THE SUPPLY ACCESS FOR
  ELIGIBLE CONSUMERS NO LONGER THAN YEAR 2004.
• TO CREATE A SOLID BASIS FOR THE ENTRANCE INTO THE
  MARKET OF NEW SUPPLIERS IN ORDER THAT ELIGIBLE
  CUSTOMERS CAN ACCESS THE LIBERALISATION, IS
  ESSENTIAL.
• THE METERING PROCEDURES AND EQUIPMENT ARE TO BE
  REVISED TAKING INTO ACCOUNT THE NEW AVAILABLE
  TECHNOLOGIES AND ELIMINATING OBSTACLES FOR
  CONSUMERS TO EFFETELY SELECT AND CHANGE THEIR
  ENERGY SUPPLIER, FACILITATING THEIR ACCESS TO
  ORGANISED MARKETS.

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QUESTION 5 UNBUNDLING

• THERE IS NOT A COMPLETE FULFILMENT OF THE
  DIRECTIVES CURRENT REGULATION PROVISIONS ON
  ELECTRICITY AND GAS
• INFORMATION FLOWS BETWEEN THEORETICALLY UNBUNDLED
  COMPANIES
• JUSTIFICATIONS GIVEN BY TRANSMISSION COMPANIES TO
  DENY COMMERCIAL TRANSACTIONS, BASED ON
  QUESTIONABLE SECURITY CRITERIA
• THE ENTITIES WHICH ARE ENTRUSTED WITH FUNCTIONS
  LINKED TO NETWORK MANAGEMENT, DETERMINATION OF
  AVAILABLE CAPACITY IN INTERCONNECTION, SINCE THEY
  ARE REGULATED ACTIVITIES, SHOULD BE CONSIDERED
  INCOMPATIBLE WITH ACTIVITIES OF GENERATION AND
  CUSTOMER SUPPLY. THE LATER ACTIVITIES SHOULD BE
  ORGANISED BASED ON FREE COMPETITION

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QUESTION 6 ACCESS TO THE ELECTRICITY AND GAS
SYSTEM

• LACK OF FIRM AND PUBLISHED AVAILABLE CAPACITY IN
  INTERCONECTOR.
• ACCESS TO THE NETWORK IS NOT ALWAYS BASED ON
  PUBLISHED TARIFFS.
• DIFFERENT REGULATION AND CHARGES, THAT
  EFFECTIVELY CREATE PANCAKING, IN THE ALLOCATION
  OF CAPACITY IN THE INTERCONNECTION OF THE
  DIFFERENT ELECTRICAL SYSTEMS.
• ANCILLARY SERVICES ARE NOT PROVIDED ON THE BASIS
  ON AUCTIONS OR MARKET MECHANISES IN ALL MEMBER
  COUNTRIES.
• SECURITY STANDARDS OF ELECTRICAL SYSTEMS AND LACK
  OF COMMON PRINCIPLES FOR TECHNICAL MANAGEMENT OF
  THE NETWORK ARE NOT COMMON ACROSS THE EUROPEAN
  UNION.
• LACK OF HARMONISED MARKET MECHANISMS FOR
  BALANCING POWER.