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Intraday Cross Border The Netherlands-Belgium


Content 1. Overall design 1. 2. 3. 4. 5.

Process description Capacity calculation Elbas trading platform Tradable products Timeline & Nominations

2. Contractual impacts 3. Price boundaries 4. Transparency

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Content 1. Overall design 1. 2. 3. 4. 5.

Process description Capacity calculation Elbas trading platform Tradable products Timeline & Nominations

2. Contractual impacts 3. Price boundaries 4. Transparency

11/02/2011

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Intraday Market Coupling Until 16/02/2011 : • Continuous trading of hourly and multi-hour products • BE: until 5 min before delivery • NL: until 1h30 before delivery

• Two steps required for cross border ID deal • Secure cross border capacity via explicit pro-rata allocation mechanism • Trade the commodity

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Intraday Market Coupling After implementation of implicit cross border capacity allocation: • Continuous trading of hourly and block products • BE: until 5 min before delivery • NL: until 1h30 before delivery

• Orders become available for trading in other market • BE orders in NL; NL orders in BE • between 21h00 D-1 and 1h30 to 2h30 before delivery • if cross border capacity is available

Only one step required for cross border ID deal!

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NL-BE solution Elia, TenneT operators

Capacity Matrix Matching Algorithm Shared Order Book

APX-ENDEX NL market Clearing/ Notification 11/02/2011 08/10/2010 Systems

Elbas system • Hosted by NPS • Local operations by APX/Belpex • Separate from NPS Elbas market

Belpex BE market Clearing/ Notification Systems

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NL-BE solution: High Level Architecture TenneT Capacity

TenneT Nominations

Elia Capacity

Elia Nominations

Elia Operator

Shipper Hub / XB Nominations

ATC Submission

Trading

ELBas

SFTP Service

Shipper Hub / XB Nominations

XB Application

Trader

EuroLight

Market Surveillance / ATC Maintenance

Monitoring

Hub Nominations

APX-ENDEX Operator Settlement

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Interim solution • Interim solution, as much as possible based on existing systems • • • •

Elbas as–is Clearing and settlement as–is (via Eurolight) Minimal impact TSO systems XBID application to be built by the PXs – connect Elbas to Eurolight and new functionality of cross border nominations – taking into account the existing infrastructure.

• Important improvement of today’s allocation mechanism • Continuous implicit allocation, coupling of existing ID markets • Initial Scope: NL-BE • Potential: NL-DE and NL-NO targeted, FR-BE can be investigated

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Interim solution • Facilitates development of an enduring solution • Refinement of target requirements, based on learning experience • Governance framework can be re-used for enduring solution, although not a necessity • Strong commitment of APX-Endex, Belpex and Nord Pool to support establishing the enduring Target Solution, in part given by shared views and secured by similarities in shareholder structures

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Advantages of Intraday Market Coupling •

Removes unnecessary risks of trading separately short-term transmission capacity and energy

Optimal use of capacity

Guarantees the optimal utilization of cross-border capacity

Single market

More efficient generation capacity utilization

Efficient market

Less prone to market abuse (no capacity hoarding)

All market participants benefit from cross-border capacity

Encourages liquid, robust spot markets

 1 further step towards European Internal Energy Market

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Continuous implicit capacity allocation No capacity (comparable to today’s situation) Market A Buy

Market B Sell

Buy

Sell S:20MW@80€

S:20MW@80€ S:50MW@75€ S:25MW@70€

P:50MW@70€

P:25MW@65€

P:25MW@65€

P:30MW@60€

P:45MW@60€

Market A: Liquid / low spread

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Market B: few sell / high spread

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Continuous implicit capacity allocation ATC A->B = 60 MW Market A Buy

Market B

S:20MW@80€ S:50MW@75€ P:50MW@70€ P:10MW@65€

Buy

Sell

S:25MW@70€

ATC 60

Sell S:20MW@80€ S:35MW@75€

P:50MW@70€

P:25MW@65€

P:25MW@65€

P:30MW@60€

P:45MW@60€

S:25MW@70€

• With 60 MW capacity from A to B • 60 MW cheapest sell orders in A are shown in B • 60 MW most expensive buy orders in B are shown in A

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Continuous implicit capacity allocation ATC B->A = 30 MW Market A Buy

Market B

S:20MW@80€ S:20MW@80€ S:50MW@75€ P:50MW@70€ P:10MW@65€

Buy

Sell

S:25MW@70€

P:25MW@65€ P:30MW@60€

ATC

S:20MW@80€ S:35MW@75€

60 30

Sell

P:50MW@70€ P:25MW@65€

S:25MW@70€

P:25MW@65€ P:45MW@60€

• With 30 MW capacity from B to A • 30 MW most expensive buy orders in A are shown in B • 30 MW cheapest sell orders in B are shown in A (but only 20 MW available)

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Continuous implicit capacity allocation Matching Market A Buy

Market B

S:20MW@80€ S:20MW@80€ S:50MW@75€ P:50MW@70€ P:10MW@65€

P:25MW@65€ P:30MW@60€

Buy

Sell

S:25MW@70€

ATC

S:20MW@80€ S:35MW@75€

60 30

Sell

P:50MW@70€ P:25MW@65€

S:25MW@70€

P:25MW@65€ P:45MW@60€

• A sell order of 25 MW in market A can match a buy order in market B

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Continuous implicit capacity allocation Netting Market A Buy

Market B Buy

Sell S:20MW@80€ S:20MW@80€

ATC

S:50MW@75€ P:25MW@70€ P:10MW@65€

P:25MW@65€ P:30MW@60€

S:20MW@80€ S:35MW@75€

35 55

Sell

P:25MW@70€ P:25MW@65€

P:25MW@65€ P:45MW@60€

• 25 MW of capacity used in the direction A -> B (ATC A->B = 60 – 25 = 35) • 25 MW can be netted in the direction B -> A (ATC B->A = 30 + 25 = 55) • Orderbooks are updated accordingly

Continuous implicit capacity allocation makes intraday markets more efficient and creates more 11/02/2011 08/10/2010 opportunities for market players

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Content 1. Overall design 1. 2. 3. 4. 5.

Process description Capacity calculation Elbas trading platform Tradable products Timeline & Nominations

2. Contractual impacts 3. Price boundaries 4. Transparency

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Calculation of NTC ID - general NTC ID calculated by Elia

NTC ID calculated by TenneT

Minimum NTC ID is calculated

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ATC ID (inclusive netting) is calculated and published

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Calculation method at Elia – NTC DA • A NTC for a day D is calculated on W-1 : – DACF file of a historical day – Coordination within CWE – Taken into account : grid topology, generation data, overall load, import/export per area, weather conditions ...

• on D-2 : – reevalution of NTC calculated in W-1 – Taken into account new information of parameters regarding grid topology, generation data, weather conditions ... – Coordination in CWE

• Finalised on D-1 in the morning

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Calculation method at Elia – NTC ID • D-1 @ 15h00 : start of grid security analysis • D-1 @ 18h00 : deadline to announce to ARPs modifications to nominations of generation units + start of "ID production" procedure • D-1 @ 18h00 : DACF file of each hub must be available for day D • D-1 @ 18h00 : CORESO calculates "combined DACF file" • D-1 @ 19h00 : Elia starts calculation of NTC ID based upon "combined DACF file" and coordinates with TenneT on minimum value + computation of ID ATC (taking into account Y-M-D nominations, inclusive netting) • D-1 @ 20h30 : ATC ID publication 11/02/2011

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Calculation method at Elia – NTC ID • Special tool calculates NTC ID on both BE-NL & BE-FR borders (linear optimisation algorithm) • Calculation of flows to obtain maximal NTCs on both borders in both directions, based upon : • Base Case (="Combined DACF file"), including last update of – Generation – Grid topology – Import/export of each hub – Already allocated capacity Y+M+D – Weather conditions • in CWE and neigbouring regions.

• Elia values of NTC ID are sent to TenneT

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Calculation method at TenneT – NTC ID • The calculation method is very similar to the one from Elia: – Based on the NTC determined for day-ahead market – Reductions may be applied due to the results of the Net Secure Analysis, starting at 19:00, which is based on • the "combined DACF-file" • Most recent load info is taken into account

– Taking into account maximum values for import/export on Dutch borders

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Submission of ATC values to Elbas

Elia Receive Day-Ahead Nominations

Elia Calculate Intraday ATC

TenneT Receive Day-Ahead Nominations

TenneT Calculate Intraday ATC

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TenneT/Elia Confirm Intraday ATC

ELBas Interpret Intraday ATC Elia Upload ATC To ELBas

ELBas XB Trading Available Elia Confirm ATC In ELBas

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Content 1. Overall design 1. 2. 3. 4. 5.

Process description Capacity calculation Elbas trading platform Tradable products Timeline & Nominations

2. Contractual impacts 3. Price boundaries 4. Transparency

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Elbas today • •

The only cross border intraday market in Europe Continuous 24/7 trading – Individual hours – Blocks bids

A tool to adjust trades made in the day-ahead market before hour of delivery Fast developing liquidity:

Finland Norway Sweden

Denmark

Germany

– 1.8 TWh in 2008 – 2.3 TWh in 2009

• • •

Real-time Reliable Proven

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The Elbas model as-is • Developed during the nineties – Customer need for adjustment of day-ahead schedules before hour of delivery – Risk and uncertainty due to expensive and unpredictable balancing market – Need for a more efficient use of the remaining cross border capacity after day-ahead trading – Potential for a better use of production flexibility across borders

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Elbas ad-interim •

Implicit cross border trading makes better use of grid capacity: Immediate improvement of current situation NL-BE Potential to link NL-BE to NO and GE: – – – – – – –

Access to counterparts with different product mix Access to counterparts with different weather conditions Access to counterparts with different marginal costs Increases the potential for flexible producers (i.e. hydro) Reduces the risk of the balancing market Reduces the risk of prices below marginal cost Learning experience to help develop enduring Target Solution

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Finland Norway Sweden

Denmark Netherlands Belgium

Germany

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The Price Information window Information on prices and volumes for series that are open for trade. •Only bids for which its possible for you to enter as counterparty, limited by the ATC to/from the area you are located • All functionalities can be accessed from the menus (upper part) •Important functions also via left mouse-button. E.g., by clicking the best buy- or sell bid contracts can be sold or bought.

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The bid A bid consists of: - the product, i.e. the series - the volume - the price

PH(hh)(yy)(mm)(dd)

Priority order of bids: 1. price 2. arrival of the bid to the bid register

The bid is binding until: - a trade happens, the bid is changed or cancelled - i.e. a bid can be changed or cancelled until a bid finds counterparty in the market

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The Order Book Monitor and change your own bids •Valid bid,”State”-column is ”Active” •Bid on hold, ”State”-column is ”Inactive” •Cancel bids by selecting them and clicking ”Cancel Order” • Change bids by selecting them and clicking ”Change Order” • (In)Activate by selecting the bids and clicking ”Activate” or ”Inactivate” • (In)Activate all bids simultaneously by selecting ”Activate All” or ”Inactivate All”. 11/02/2011

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Content 1. Overall design 1. 2. 3. 4. 5.

Process description Capacity calculation Elbas trading platform Tradable products Timeline & Nominations

2. Contractual impacts 3. Price boundaries 4. Transparency

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Tradable products • Two type of products – Hourly limit orders • Can be filled partly

– Block orders • P & V same for all hours • Block orders can only match with other (identical) block orders • All or none

• Minimum tick sizes: 0.1 € and 1.0 MW

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Content 1. Overall design 1. 2. 3. 4. 5.

Process description Capacity calculation Elbas trading platform Tradable products Timeline & Nominations

2. Contractual impacts 3. Price boundaries 4. Transparency

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Short overview explicit allocation Market participant nominates cross border and both hubs

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Short overview implicit allocation Market participant does one hub nomination NL - TENNET Net position: +25MW 25MW APX XBSHIP

APX CCP

Market Participants

25MW BE - Elia Net position: -25MW

Belpex

APX XBSHIP

Market Participants

25MW

Cross border nominations Hub nominations related to XBID cross border flow s Hub nominations w ith market participants

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Impact nominations for market participants • Changes are as limited as possible • When doing a trade on the market-screen – Nominate local hub, according to the local hub nominations criteria (counterparty PX) – Cross border nominations will be handled by PX – No difference (nor additional information) compared to deals within the country

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Impact nominations for PX • Additional nominations are to be handled • When parties do a cross border transaction – Deal is split up between the hubs – Shipping (cross border) is nominated by separate BRP (APX) – There will be additional nominations between PX and Shipper – 1 cross border deal results in 5 nominations by 5 BRPs • All nominations need to be consistent 11/02/2011

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Impact nominations for TSO • Changes are as limited as possible • When doing a trade this results for the TSO in – One shipping entity to provide all the cross border nominations (intraday) – Only local hub nominations from (local) market participants – Gates are only used for TSO-TSO matching of Import and Export nomination by market participants

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Deadlines trading overview • Cross border trading on Elbas – based on the confirmed ATCs – continuously possible until the deadline for the nomination gate

• Deadlines - Cross border trading is possible until 1h30 or 2h30 before the beginning of the delivery period. - Trading on the Belgian hub is possible until 5 minutes before the beginning of the delivery period. - Trading on the Dutch hub is possible until 1h30 before the beginning of the delivery period.

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Deadlines nominations overview • Nominations to the TSOs - Cross border nominations by APX cross border shipping agent: TSOs must receive nominations following the gate system in place (ex-ante) - Hub nominations in Belgium by Belgian market participants: ELIA must receive nominations before 14h00 D+1 (ex-post) - Hub nominations in the Netherlands by Dutch market participants: TenneT must receive nominations 1 hour before the delivery period (ex-ante)

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Gates overview Gate

• •

Door

Door

Scope of the gate

Hour ("H") Opened at

Closed at

21

21h00

22h00

next day (00h -> 24h)

23

23h00

00h00

next day (01h -> 24h)

01

01h00

02h00

current day (03h -> 24h)

03

03h00

04h00

current day (05h -> 24h)

05

05h00

06h00

current day (07h -> 24h)

07

07h00

08h00

current day (09h-> 24h)

09

09h00

10h00

current day (11h -> 24h)

11

11h00

12h00

current day (13h -> 24h)

13

13h00

14h00

current day (15h -> 24h)

15

15h00

16h00

current day (17h -> 24h)

17

17h00

18h00

current day (19h -> 24h)

19

19h00

20h00

current day (21h -> 24h)

Cross border trading continuously possible Until 1h30 (odd hours) or 2h30 (even hours) before the start of the delivery period

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Example for Gate 05 (scope 7h00 till 24h00) Nominations: • Trade concluded (e.g 5MW for 7h00-9h00) after closing G03, cross border nominations to the TSOs at the latest at G05 • = 06h00 at the latest • The PX system will send the netted cross border nominations to TenneT and ELIA respectively • The market participants nominate the deal on internal local hub nomination • TenneT before 06h00, Elia before 14h00 D+1

Trading scheme: • Belpex local trading closes 5 minutes before the delivery period (06h55) • APX-ENDEX local trading closes 1h30 before the delivery period (04h30) • Cross border closes 1h30 or 2h30 before gate closure (04h30)

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Deadlines trading/nominations overview

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Content 1. Overall design 1. 2. 3. 4. 5.

Process description Capacity calculation Elbas trading platform Tradable products Timeline & Nominations

2. Contractual impacts 3. Price boundaries 4. Transparency

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APX-ENDEX Market Rules

• No changes will be made to market rules & fees • Product specification will be available via website

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Belpex Market Rules & Procedures • Market Rules – Ministerial Decree – October 2010: updated for XBID NL-BE – – – –

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Volumes to be expressed in a multiple of MWh Prices to be expressed with a maximum of one decimal Removal CoDAM Entered into force 9 Nov 2010

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Belpex Market Rules & Procedures • Market Procedures – More detailed, within framework set out by MR – Alignment with MR: 9 Nov 2010 – Limited impact, apart from CoDAM – Communication at the latest two weeks before (// CWE updates)

– Updates with concrete info for XBID NL-BE: – Contents » Trading phases » Updates w.r.t. ELBas » ...

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ARP Contract Elia • Annex 2 – Reference to explicit allocation updated to implicit allocation

• Annex 5 – No more cross border nominations by ARPs for intraday on BENL border

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PV Contract TenneT • Grid code – approval awaited by EnergieKamer by 15 February 2011

• INB rules – Agreement for INB will be ended at the launch of the new intraday cross border NL – BE mechanism

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Content 1. Overall design 1. 2. 3. 4. 5.

Process description Capacity calculation Elbas trading platform Tradable products Timeline & Nominations

2. Contractual impacts 3. Price boundaries 4. Transparency

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Price boundaries • Negative prices will be available • System has technical limit – -99 999.99 €/MWh – Generic setting for all Elbas markets

• Harmonization between markets required – Actual price boundaries will be communicated in a later stage

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Current price boundaries • APX-ENDEX – Negative prices possible – [-3000 €/MWh, 3000 €/MWh]

• Belpex – Since CWE MC launch, negative prices are implemented – [-3000 €/MWh, 3000 €/MWh]

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Content 1. Overall design 1. 2. 3. 4. 5.

Process description Capacity calculation Elbas trading platform Tradable products Timeline & Nominations

2. Contractual impacts 3. Price boundaries 4. Transparency

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Capacity & market data • Transmission capacities and market data (anonymous) on website Nord Pool Spot, Elia & TenneT • Customer reports (own orders and trades) and detailed anonymous market information via Elbas – – – –

Price information and market depth Transmission capacities Trade ticker Real-time

• All individual trade data accessible by participant via existing APX-ENDEX / Belpex facilities and protocols • Anonymous statistics on Belpex website and APX-ENDEX ftp server 11/02/2011

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Transmission capacities (public website)

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Elbas price information window

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intraday-cross-border-netherlands-belgium  

http://www.elia.be/~/media/files/elia/products-and-services/crossborder2/intraday-cross-border-netherlands-belgium.pdf

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