Implementation of the Network Code Balancing in the Netherlands Marcel Neef 28 November 2013

Programme Introduction Network Code (NC) Balancing Process steps in the Netherlands Current balancing regime Daily imbalance charges Balancing actions on the gas exchange Lessons learned 28 November 2013

1. NC on Gas Balancing of Transmission Networks Harmonization of EU-wide rules on balancing Goal: to enable network users throughout the EU to manage balancing positions economically efficient and to be able to do it in a non-discriminative manner EU timeline 2011 ACER Framework Guidelines ENTSOG Network Code Balancing NC approved in comitology process 2014 NC expected to be in effect as of October 2014 2015 Expected end of implementation period is October 2015 28 November 2013

2. Process steps in the Netherlands GTS assessed the impact of the NC Balancing on the Dutch market based balancing regime. Number of changes needed and two choices to be made Implementation decisions made in close consultation with network users, representative organizations and regulator ACM Implementation as of June 2014

3. Current balancing regime Continuous market based balancing Network users have primary balancing responsibility Maximal linepack flexibility available for network users Near real time information provision 06:00 Shipper A SBS Shipper B

4. Daily imbalance charges End of day settlement NC Balancing states two implementation options: end of day settlement and Linepack Flexibility Service 06:00 Shipper A SBS Shipper B

4. Daily imbalance charges Linepack Flexibility Service NC Balancing states two implementation options: end of day settlement and Linepack Flexibility Service 06:00 Use of Linepack Flexibility Service Shipper A Use of Linepack Flexibility Service SBS Use of Linepack Flexibility Service Shipper B Use of Linepack Flexibility Service Selected option

5. Balancing actions on the gas exchange Current regime: balancing actions via dedicated bid price ladder mechanism; our own initial balancing platform NC states two options Continue the balancing platform as an interim measure Use the within-day market of the gas exchange with NC product merit order Use of the within-day market preferred by network users and representative organizations

5. Balancing actions on the gas exchange Delivery on TTF Use of title products in line with NC merit order Two products: TTF Balance of day and TTF Next hour prognosis hh:20 06:00 SBS prognosis is in orange or red zone: TTF Next Hour product SBS SBS prognosis is in light green zone: TTF Balance of day product

6. Lessons learned Close and transparant consultation with stakeholders contributes to a succesfull implementation process Network users prefer to have the lowest balancing costs Interpretation NC not always easy First step towards harmonization Alignment with gas exchange is a lot of work

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