1 FACILITIES 2 M A R K E T S & B A L A N C I N G T E A M S - PowerPoint PPT Presentation

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FACILITIES 2

M A R K E T S & B A L A N C I N G T E A M S Y S T E M O P E R A T I O N 3 N A T I O N A L G R I D

WELCOME So what’s on the Agenda? Teresa Thompson Markets & Balancing Development 4

AGENDA Welcom lcome e – En Energy rgy UK • Introduction & Welcome • European Network Code Process- How does it work in Europe? • Market Codes (CACM & FCA, Common Grid Model) • EU Balancing Guideline 11:00 :00 Break ak (15 mins) s) • Operational Codes • Connection Codes • Joint European Stakeholder Workgroup • Proposal for implementation of European Network Codes – European Interface Document (EID) 12:00 Lunch & Networking ‘ Come & talk to us’ 13 13:00 :00 Close ose Out ut Teresa Thompson Markets & Balancing Development 5

WELCOME Europea Eu pean n Netw etwor ork Code des Impl mpleme ementa ntati tion on GB Deliver ery So Who ho are we & what t do we do? Kyla Berry Markets & Balancing Development Manager 6 Markets & Balancing Development

MEET THE TEAM – MARKETS & BALANCING DEVELOPMENT Kyla Berry Markets & Balancing Development Manager 7 Markets & Balancing Development

EUROPEAN NETWORK CODES DEVELOPMENT PROCESS Europea opean n Net etwor ork k Codes es Development lopment Proc ocess ess How does s it work k in Europ ope? e? Christopher Fox Markets & Balancing Development 8

EUROPEAN 3 RD PACKAGE DRIVERS Christopher Fox Markets & Balancing Development 9

EUROPEAN NETWORK CODES DEVELOPMENT PROCESS Christopher Fox Markets & Balancing Development 10

EUROPEAN NETWORK CODES DEVELOPMENT PROCESS Christopher Fox Markets & Balancing Development 11

EUROPEAN NETWORK CODES DEVELOPMENT PROCESS Connection Requirement for Generators (RfG) Codes  Set of harmonised rules for new grid connections across EU, with a Demand Connection Code (DCC) focus of ensuring system security High Voltage Direct Current (HVDC)  Harmonising allocation rules for Interconnector Forward Capacity Allocation (FCA )  Creating European wide implicit Day-Ahead and Intra-Day markets Market Codes  Regionalised cross border capacity calculation Capacity Allocation & Congestion Management (CACM)  Development of pan-EU platforms for the exchange of standardised Balancing balancing energy products  Harmonisation of imbalance settlement arrangements System Operation SO Guideline  Setting minimum system security, operational planning and frequency Operational Security (OS) management standards to: Codes  Ensure safe and coordinated system operation across Operational Planning (OP) Europe, and  Create a standardised framework for regional cooperation. Load Frequency Control & Reserve (LFC&R)  Harmonisation of system defence and restoration procedures during Emergency & Restoration (E&R) severe events Christopher Fox Markets & Balancing Development 12

OVERVIEW OF THE EUROPEAN MARKET CODES Overvie view w of the Eur uropean pean Mark rket Codes es So what t does s it mean? n? Rob Selbie Markets & Balancing Development 13

OVERVIEW OF THE EUROPEAN MARKET CODES It establishes a platform for managing capacity & flow around the interconnected system to facilitate a single EU market Market Design Market Design Capacity Allocation & Congestion Management (CACM) Guideline • Implicit Day Ahead & Intraday cross border trading • Bidding zone reporting process and subsequent review Forward Capacity Allocation (FCA) Guideline • Long term transmission rights; -Physical Transmission Rights (PTRs) with Use It or Sell It (UIOSI) - Financial Transmission Rights (FTR) options -FTR obligations • Single Allocation Platform with Harmonised Allocation Rules Regional Capacity Calculation Regional Capacity Calculation • CACM and FCA both increase regional TSO coordination with capacity calculation used to determine interconnector capacities • Calculation underpinned by a pan- EU Common Grid Model (CGM) Rob Selbie Markets & Balancing Development 14

OVERVIEW OF THE EUROPEAN MARKET CODES CACM and FCA have been published and become law within the UK; - CACM entry into force 14 Aug 2015 - FCA entry into force 17 Oct 2016CACM and FCA now requires T TSOs, NEMOs to draft, consult, and submit proposals to regulators on detailed design aspects. CACM proposals largely complete by end of 2018, FCA by end of 2019. Any changes to GB codes to implement CACM TSO = Transmission System Operator and FCA will be raised and consulted on NEMO= Nominated Electricity Market Operator through the normal GB code governance routes Rob Selbie Markets & Balancing Developments 15

OVERVIEW OF THE EUROPEAN MARKET CODES NG and other TSOs will develop new processes to increase regional coordination Anyone trading Interconnector capacity in the forwards markets or trading cross border energy in the day ahead and intraday timeframes Generators and demand to provide information on which TSO decisions are made on a regional basis (see Common Grid Model) Power exchanges (in their new role as NEMOs) will develop new processes to deliver a pan-EU marketplace Interconnector owners (current and future) will operate under new rules, including new requirements on interconnector firmness Rob Selbie Markets & Balancing Developments 16

OVERVIEW OF THE EUROPEAN MARKET CODES Common mmon Grid d Model l (CGM) GM) So what t is the Comm mmon n Gr Grid d Model? l? James Bradley Markets & Balancing Developments 17

OVERVIEW OF THE EUROPEAN MARKET CODES Common Grid Model (CGM) TSO A IGM • A European- wide network model assembled from each TSO’s individual TSO B grid model (IGM) • Realistic and accurate representation of the Transmission & Distribution IGM networks • One scenario for each market time unit (1 hour) • Built to a common standard with a harmonised modelling approach • Used as a key tool for many new coordinated European processes – including capacity calculation TSO C IGM Rolling Daily Process that supports target model Each TSO’s IGM is built CGM built CGM built using the latest available at D-2 at D-1 data from market participants for specific delivery times Day Ahead Intraday Market Market (Auctions (Continuous) James Bradley Markets & Balancing Development 18

OVERVIEW OF THE EUROPEAN MARKET CODES So when does it come into effect? 2016 2017 2018 Obligations Q2 Q3 Q3 Q3 Q4 Q1 Q2 Q4 Q1 Q2 TSOG EIF Update CGMM CACM EIF Update Aug 2015 FCA EIF & GLDPM for CGMM & ENC deadlines FCA (Long- GLDPM for term TSOG timescales) NRA approval Early testing DA & ID CGM TSO develop CGM and parallel Requirements CGM process IGM run of CGM Methodology (for CACM) fully operational capability process delivered NRA approval TSOs DA & ID data Data Provision GLDP publish list requirements process fully of parties for CACM) Methodology operational required to delivered provide data Key Project Proposal Deadline James Bradley Markets & Balancing Developments 19

OVERVIEW OF THE EUROPEAN MARKET CODES Overvie view w of the EU Balanc ancing ing Guideline deline Christopher Fox Markets & Balancing Development 20

OVERVIEW OF THE EUROPEAN MARKET CODES Harmonisation of Market Cross Zonal Capacity Pan-EU Balancing Harmonisation of Market Cross Zonal Capacity Energy Market Design & Settlement Reservation (CZC) Design & Settlement Reservation (CZC) • Harmonised Gate Closure Time • Development of pan-EU platforms • Opens the possibility for TSOs to for standard products for the exchange of standard reserve XB capacity for the • Harmonisation of ISP at balancing energy products exchange of balancing energy • 6 year implementation period Synchronous Area level • Co optimisation with market • Harmonisation of imbalance • Replacement Reserves (RR) timeframes arrangements (preference for • Manual Frequency Restoration • TSOs to develop detailed single imbalance pricing) Reserves (mFRR) methodologies • Harmonisation of reserve • Specific products retained procurement arrangements nationally Early Implementation – Project TERRE Christopher Fox Markets & Balancing Development 21

OVERVIEW OF THE EUROPEAN MARKET CODES So when is it going to happen? 2016 2017 2018 2019 2020 2021 2022 2023 Obligations Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 All TSOs Join Project TERRE Replacement RR EU Platform Platform Reserves (RR) Early Implementation EIF+2yrs EIF+4yrs mFRR mFRR EU All TSOs Join Manual Frequency Early Implementation Platform Platform Restoration mFRR EIF+4yrs EIF+6yrs Entry into Force (TBC) Imbalance Deadline for All TSO Proposal Settlement Harmonisation EIF+1yr EIF+3yrs Harmonisation Products Harmonised CZC TSO Proposals Pricing CZC Res Reservation (not all shown) Algorithms etc Process EIF+2yrs EIF+1yr EIF+4yrs Deadline for general General Compliance compliance EIF+1yr Transition Key Project Proposal Deadline Period EIF= Entry into Force Christopher Fox Markets & Balancing Development 22