NordREG has been preparing a common approach on how to perform the upcoming analysis of the cross-zonal hedging opportunities in line with Commission Regulation (EU) 2016/1719 of 26 September 2016 establishing a guideline on forward capacity allocation (FCA GL) article 30.
Below you will find a link to the draft methodology, based on which the regulators are planning to conduct the upcoming study. All Nordic market participants are hereby invited to comment on the draft “Methodology for assessment of the Nordic forward market”.
NordREG is especially interested in hearing the stakeholders views on how the approach could be improved to better analyse the hedging opportunities in the Nordic markets. The background for the assessment is in the requirements in FCA GL article 30. The previous assessment was conducted in 2016-2017, please see links below.
The end objective is for regulators to assess whether there are sufficient hedging opportunities in the Nordic electricity market. If the hedging opportunities in two adjacent bidding zones are deemed insufficient, the regulators on each side of the bidding zone border must, in a coordinated manner, make decisions targeted at the TSO’s on each side to introduce long term transmission rights (LTTRs) or other measures to improve hedging opportunities.
The timeline looks as follows:
- This current consultation on proposed evaluation method (May-June 2020).
- Internal regulator assessments and decision on way forward (summer 2020).
- Data collection, calculations, assessments and draft decisions. (the timeline and exact approach varies per country).
- Consultations on the assessments and the hedging needs of market participants according to FCA art. 30(3)(a) (circa winter 2020-2021).
- National decisions on whether there are sufficient hedging opportunities and coordinated decisions per bidding zone border on introducing LTTRs or not (deadline April 2021)*.
Last day for replies – 2 June 2020
Please send your views, comments, considerations etc. in writing to firstname.lastname@example.org with copy to email@example.com. Please mark your answers to the consultation with the following reference number 2020-100867.
Per default replies are public, but if you wish to be anonymous, please indicate this.
Deadline for replies: 2 June 2020 EOB.
*As Norway has not implemented the FCA GL in national legislation at this point, the deadline for Norwegian borders will depend on the implementation time.
Links to 2016-2017 documents
In July 2018 the Nordic Regulators approved the Flowbased Capacity Calculation Methodology (“flowbased”) for the Nordic Capacity Calculation Region (“CCR Nordic”) in accordance with Article 20(2) of Commission Regulation (EU) 2015/1222 of 24 July 2015 establishing a Guideline on Capacity Allocation and Congestion Management.
An important part of the legislation and of the flowbased methodology is that “the TSOs concerned shall test the new approach alongside the existing approach and involve market participants for at least six months”. To Nordic Regulators’ understanding, testing the flowbased alongside the existing approach implies to have market coupling results each day with flowbased capacity input alongside the market coupling results with the current capacity input. This is referred to in the CCR Nordic methodology as “parallel runs”, and have been agreed to be performed for at least one year before flowbased can go live.
The NEMOs, which own the market coupling algorithm, have stated there are obstacles to perform the parallel runs on the same day as the market coupling, and therefore they want to do the parallel runs with a delay of 14 days. The Nordic Regulators assume that this is not in line with what everyone had in mind about parallel runs. Thus, the Nordic Regulators would welcome input from the stakeholders, and we hope you will take your time to answer the following and help us.
Question 1: How would it affect your assessment and understanding of the flowbased to have a 14-days delay on parallel runs compared to having the parallel run on the same day as the market coupling?
Question 2: Do you expect to be looking at the parallel run flowbased results every day, during the parallel runs? If not, with what frequency do you expect to assess the flowbased results?
Question 3: What kind of other problems, if any, would you foresee in running the parallel run with a delay of 14 days?
The Nordic Regulators appreciate your feedback by email before the end of 28 April 2020.
On behalf of Nordic Regulators
Søren Lorenz Søndergaard
Danish Utility Regulator
Phone: +45 41715373
The Regulatory Authorities of Capacity Region Nordic (the Danish Utility Regulator, the Finnish Energy Authority and the Swedish Energy Market Inspectorate) have decided to refer proposals on the establishment of a Nordic Market for frequency restoration reserves with automatic reserves to the Agency for the Cooperation of Energy Regulators (ACER).
The proposals were submitted by the Nordic Transmission System Operators for regulatory approval in accordance with the EU Regulation Establishing a Guideline on Electricity Balancing (EB GL). The purpose of the regulatory approval is to ensure that the proposals are compliant with the EB GL and other relevant EU legislation.
The Norwegian Energy Regulatory Authority has participated in discussions with the CCR Nordic NRAs on an informal basis pending the implementation of EB GL in Norway.
None of the revised proposals were found approvable by all of the CCR Nordic Regulatory Authorities. A unanimous approval within the deadlines in the EB GL is a prerequisite for approval at regional level.
As a consequence of the referral, ACER will now have to decide on the revised proposals within six months in accordance with the decision-making procedure set out in the ACER Regulation.
The referral letter to ACER with an accompanying document explaining why the proposals were not found approvable can be accessed here:
Contact persons in NordREG
Thomas vom Braucke, DUR
Maria Rydberg, Ei
Jori Säntti, EV
Alexander Kellerer, NVE-RME
NordREG believes that aggregators have the potential to be a key enabler of the green and consumer-led energy transition and that a coordinated approach to developing a harmonized framework for aggregators will bring further benefits for the Nordic countries.
Aggregation shows great potential for enabling a more efficient and sustainable energy system by allowing consumers to shift demand away from peak and constrained periods. Aggregators can empower consumers to engage in and benefit from electricity markets, enable wide-scale and localized flexibility as an alternative to costly investments in network expansions and upgrades to help accommodate new demand and renewable generation.
The Electricity Directive of the Clean Energy Package requires EU Member States to develop a framework for independent aggregators that enables them to operate in all electricity markets. The directive defines ‘independent aggregator’ as a market participant that combines multiple customer loads or generated electricity for sale, purchase or auction in any electricity market, and is not affiliated to the customer’s supplier. Customers must be able to choose an independent aggregator that operates concurrently with the customer’s existing supplier, without consent from the existing supplier.
NordREG’s overall recommendation is that the regulatory framework for independent aggregators should be adequately harmonized in the Nordic countries and not be limited to one country. This will maximize economies of scale and scope, enable more competition, and allow innovation in demand response to flow across borders. The work on harmonization should assess whether the potential benefits of harmonization are proportional to the perceived costs. In order to achieve a harmonized framework for aggregators, NordREG recommends that the Nordic ministries develop a joint road map to coordinate the work of the relevant authorities.
NordREG has a number of more detailed recommendations related to the following topics:
- General market access for independent aggregators
- Direct financial responsibilities for energy imbalances caused
- Compensation for unmatched positions caused by independent aggregators, and
- Measurement of flexibility
NordREG’s role is to advise on the regulatory framework in which independent aggregators can operate in all markets. The recommendations therefore seek to increase the possibilities for different aggregator models and not to limit them, thereby allowing market driven solutions. NordREG encourages market actors to innovate in this area and to come forward with new models of aggregation where they are efficient.
David Fried, chair of NordREG’s Flexibility Working Group: firstname.lastname@example.org
NordREG is gathering the views of stakeholders with experience of aggregation. The first and most pressing issue we are seeking to address, is the new requirement to allow for ‘independent aggregators’ (IA) under the new Electricity Directive. NordREG is aiming to align our approach to the regulatory framework around independent aggregation where possible to minimise cross-border barriers. This raises a lot of questions around metering, settlement, balance responsibility, market design and how such a system of aggregation could work in practice.
Time: 9:00 – 15.00, 21st Jan, 2020
Place: Radisson Blu Arlanda Airport Conference
Please register your attendance and food allergy to email@example.com before 17th Jan 2020. Attendance is limited, so only one seat per organization is guaranteed.
9:00 Breakfast and mingel
10:00 Types of Markets for IAs
10:45 Balance Responsibility and Settlement
12:00 Measurement and Data Exchange
13:00 Measurement and Data Exchange continued
13:50 Compensation for indirect imbalances
The Nordic Energy Regulators held a stakeholder meeting on cross-border capacities in the wholesale electricity markets on 3 December.
Among the topics were the ongoing process on a bidding zone review, the 70 % minimum criterion for transmission capacity and other market development updates in the Nordics and EU.
At the meeting, there were presentations and representatives from the Agency for the Cooperation of Energy Regulators (ACER), the Nordic Transmission System Operators as well as the Nordic Energy Regulators.
The meeting was open for stakeholders and other interested parties.
Today, NordREG publishes 21 recommendations on how to implement some of the retail market related articles in the Clean Energy Package into national legislation. NordREG believes that a coordinated implementation will have an important and positive impact on the Nordic retail markets.
– The recommendations support the functioning of the retail market and the integration of the Nordic markets which are important factors for efficient competitive markets to the benefit of the consumers, says Carsten Smidt, Director of The Danish Utility Regulator, DUR, and this year´s Chair of NordREG.
NordREG is an organization for the Nordic energy regulators that promotes a legal and institutional framework and conditions necessary for developing Nordic and European electricity markets.
With NordREG´s long-term ambition to work towards a harmonized Nordic retail market in mind, NordREG has selected four retail market related articles in the new electricity directive as particularly important to implement in a similar way. The articles regulate basic contractual rights, fees related to switching, comparison tools and billing information.
When these articles are implemented in national legislation, NordREG recommends that:
- Termination fees for fixed term, fixed price contracts should still be permitted, as long as the fees do not exceed the supplier’s direct economic loss of losing a customer.
- Nordic energy regulators do not issue trust-marks for all comparison tools on the market, but instead ensure the quality of publicly driven comparison tools, according to the standard set by the new directive.
- Five key contractual conditions shall be highlighted in a prominent and easily readable way in the beginning of a supplier contract.
- Customers are able to choose their prefferd direct channel for information on contractual changes during the contract period.
- All customers should be able to receive bills and billing information free of charge. There should be no billing fees for paper bills, but discounts may be allowed for customers that choose electronic bills.
NordREG also publishes several recommendations for how suppliers should present mandatory information on bills.
The published recommendations represent the views of the Nordic energy regulators. However, it depends on the national legislators in each Nordic country how these recommendations will be implemented.
NordREG is an organization for the Nordic energy regulators. Our mission is to actively promote legal and institutional framework and conditions necessary for developing the Nordic and European electricity markets. The basis for the co-operation within NordREG is to identify areas of work where cooperation can take the following forms: exchange of views, working together to map and analyze energy market issues, producing reports and statements and taking common action to influence the development of the Nordic or the European energy markets.
The Nordic Energy Regulators will hold a stakeholder meeting on cross-border capacities in the wholesale electricity markets
The meeting will be hosted by the Danish Utility Regulator in Copenhagen on 3 December 2019 from 10.00-15.30.
Among the topics will be the ongoing process on a bidding zone review, the 70 % minimum criterion for transmission capacity and other market development updates in the Nordics and EU.
At the meeting, there will be presentations and representatives from the Agency for the Cooperation of Energy Regulators (ACER), the Nordic Transmission System Operators as well as the Nordic Energy Regulators.
The meeting is open for stakeholders and other interested parties.
A programme for the meeting can be found here: Agenda 3 December 2019
If you are interested in participating, please register at the Danish Utility Regulator on firstname.lastname@example.org stating full name, title and company details and mark your email: “Nordic stakeholder meeting on cross-border capacities”.
Registrations are open until 1 December 2019 on a first come, first serve basis.
In three years’ time all Nordic countries will have a data hub that will facilitate wholesale and retail market processes. The successful implementation of the data hubs and the ability to centralize the handling of market processes is a key factor for the Nordic retail market to work effectively.
In all the Nordic countries the government and regulators have given the transmission system operators (TSOs) the responsibility to operate the data hubs in each respective market.
Data hubs have been implemented successfully in Denmark and Norway. In Finland and Sweden, development of data hubs is in progress. In Finland, the scheduled start date is April 2021, and in Sweden in Autumn 2022.
In the coming years, work will be carried out to develop the existing data hubs further. In Finland and Sweden, the focus is to develop and launch data hubs with the necessary legislation and coordination with market participants.
Link to the full report: NordREG Status report on datahubs – June 2019
The Nordic national regulatory authorities (“Nordic NRAs”) are launching a consultation on the legal proposals submitted from the Nordic TSOs on:
All TSOs’ of CCR Nordic proposal for a methodology for a market-based allocation process of cross-zonal capacity for the exchange of balancing capacity in accordance with Article 41(1) of the Commission Regulation (EU) 2017/2195 of 23 November 2017 establishing a guideline on electricity balancing
Energinet, Fingrid, Statnett and Svenska kraftnät proposal in accordance with Article 33(1) and Article 38(1) of the Commission Regulation (EU) 2017/2195 of 23 November 2017 establishing a guideline on electricity balancing
The Nordic NRAs also ask for stakeholder input on the request for an exemption of transfer of bids:
Energinet, Fingrid, Statnett and Svenska kraftnät proposal for exemption for not allowing balance service providers to transfer their obligations to provide aFFR capacity in accordance with Article 34(1) of the Commission Regulation (EU) 2017/2195 of 23 November 2017 establishing a guideline on electricity balancing
The Nordic NRAs will assess and evaluate the proposals for approval within a period of 6 months or request changes to the proposals before the proposals can be approved.
The Nordic NRAs welcome written input on the proposals and the exemption at the latest 3 June 2019. Comments shall be sent to email@example.com with copy to firstname.lastname@example.org.
Please mark your answers to the consultation with the following reference: Proposals for Nordic aFRR capacity market and cross-zonal capacity allocation.
Contact persons in NordREG
Peter Christian Olsen, DUR
Elin Larsson, Ei
Jarno Lamponen, EV
Stian Henriksen, NVE