ERGEG Benchmarking report on long term transmission rights Francesco Cariello Christophe Gence-Creux ERI TF co-chairs XIX Florence Forum 14th December 2010

The ERGEG LT benchmarking report Lessons learnt Outline The ERGEG LT benchmarking report Lessons learnt The ERGEG conclusions paper

The ERGEG benchmarking report Improvement and Harmonisation of allocation rules for long term interconnection capacity: a top priority for almost all the Electricity regions (CWE, CEE, CSE, SWE and FUI) 21 out of 28 borders studied Benchmark focused mainly on Conditions for participating in the auctions Characteristics of allocated products and secondary markets

2. Which lessons ? High level of convergence of the long term auction rules Need for harmonisation, within the region and between regions, notably firmness of both allocated and nominated capacity, Force Majeure definition, obligations and responsibilities of parties Harmonisation could be facilitated by implementing a common allocation platform at regional level  Sharing the same Auction Office among different regions could further improve the cross-regional harmonisation

3. Conclusions paper: the ultimate goal is within reach Strong support from all respondents to the public consultation towards the long-term goal: a European-wide platform operating a single set of auction rules The draft framework guidelines drafted by ERGEG take a position on the main pending issues: Firmness: curtailments compensated at market spread. Physical firmness for nominated capacity is the preferred approach; The level of capacity allocated in the long-term timeframe will be subject to regulators’ approval; The nature of allocated products: FTRs or PTRs, CfDs under certain conditions The organisation of the secondary market: a regional platform for anonymous secondary trading

3. Conclusion papers: A need for a clear action plan Each region should decide the way towards a single allocation platform: Extension of CASC to the Central-South region and Switzerland is ongoing: one single platform in 2011; one single set of auction rules in 2012 Further possible extension of CASC to the Northern-CWE borders FUI and SWE regions should either establish new regional auction offices or consider the possible extension of CASC on their respective borders Implementation of harmonised rules with capacity auctioned by the Capacity Allocation Office in the CEE region

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