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Antonio Lopez-Nicolas Manager - Markets

The Capacity Allocation & Congestion Management Network Code: the way forward for IEM target model implementation EWEA 2012 Copenhagen 18 April 2012. Antonio Lopez-Nicolas Manager - Markets. Mandate for network codes and ten-year plans in Reg. 714/2009 41 TSOs from 34 countries

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Antonio Lopez-Nicolas Manager - Markets

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  1. The Capacity Allocation & Congestion Management Network Code: the way forward for IEM target model implementationEWEA 2012Copenhagen 18 April 2012 Antonio Lopez-Nicolas Manager - Markets

  2. Mandate for network codes and ten-year plans in Reg. 714/2009 • 41 TSOs from 34 countries • Fully operational since July 2009 • A trans-European network • 530 million citizens served • 910 GW generation • 300,000 km of transmission lines • 3,400 TWh/year demand • 380 TWh/year exchanges • Replaced former TSO organisations: ATSOI, BALTSO, RTSO, NORDEL, UCTE, UKTSOA System Development The role of TSOs – ENTSO-E System Operation Electricity Market Research and Development

  3. A set of network codes & framework guidelines in ... 2014 … CACM FG

  4. … as RES meets more & more of the electricity demand … ENTSO-E modeling shows 38% of E-demand could be met by RES in 2020 Antonio Lopez-Nicolas | 18 April 2012 | Page 4

  5. …and the generation mix changes fundamentally… Thousands of small power plants Large varying flows all over EU Denmark wind Source: Energinet.dk 2010

  6. The IEM Target model for 2014 Capacity calculation Flow based approach (FB) Coordinated available transmission capacity (ATC) Physical and/or Financial Transmission Rights Implicit allocation Price coupling Continuous Implicit allocation TSO-TSO balancing model Capacity allocation Time frame Long-term market Day-ahead market Intraday market Balancing market

  7. The network codes that will enshrine the target model into European legislation Day Ahead Markets Forward Markets Capacity Allocation and Congestion Management Capacity Calculation Intraday Markets Balancing FWGL Balancing NC

  8. The Capacity Allocation & Congestion Management network code • The CACM network code : • Day ahead target model for market coupling. • Intra-day target model of implicit continuous trading. • Rules for calculating capacity and defining bidding zones. • General sections on definitions, firmness, and cost recovery EC official request to draft the NC received on 19 Sep 2011 CACM NC to be delivered by 30 September 2012

  9. CACM network code: How are stakeholders involved?

  10. Public consultation launched on 23 March • The public consultation also includes a supporting document: • Attempts to explain the code in a clear way and to aid transparency. • Tries to meet the obligations placed on ENTSO-E by the EC. • And demonstrate the FWGL is met. The public consultation will be open until 23 May An open workshop will be held in Brussels on 7 May

  11. CACM Network Code – Next steps

  12. A combination of a bottom up and a top down approach is essential Network codes and implementation projects are compliments. Experience gained via projects is reflected in the codes and the codes facilitate the projects. Both are important for the delivery of the Internal Electricity Market by 2014 A robust governance framework which complements the CACM code is a must to ensure EU Wide implementation

  13. … with a regional approach … stepwise … The Nordic market – 2000 Central West Europe – 2010 ITVC – 2011 North West Europe – 2012 2300 TWh Antonio Lopez-Nicolas | 18 April 2012 | Page 13

  14. … towards a pan-European day-ahead market … The Nordic market – 2000 Central West Europe – 2010 ITVC – 2011 North West Europe – 2012 European solution – 2014 3200 TWh Antonio Lopez-Nicolas | 18 April 2012 | Page 14

  15. But … IEM “software” cannot work without an adequate European grid •  Efficient framework for facilitating infrastructure investments: • Lengthy permitting procedures (+10 years) • Insufficient political coherence and will • Lack of public acceptance •  Recent cold wave has shown that the power system has reached its limit in several places for both transmission capacity and generation flexibility • Already today some lines and substations can hardly be taken out for servicing • Wind and solar to be curtailed on an increasing number of days

  16. The scale of the challenge… build / replace more than 50000 km of grid

  17. Thank you! Antonio.Lopez-Nicolas@entsoe.eu

  18. Developing transparent & stable rules - what is a network code?

  19. The process of developing network codes Development of a Framework Guideline Development of A Network Code

  20. Summary - The status of the network codes

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