Exploring the feasibility of implicit allocation TITRE 04/04/2013 IG meeting Exploring the feasibility of implicit allocation in the gas market NMa

Exploring the feasibility of implicit allocation The drafting process of the position paper of NRAs within GRI NW on the feasibility of implicit allocation is in its final stages Report of The Brattle Group (commisison ed by NMa) Draft RCC position paper up for consultation Initial conclusions presented at SG meeting Finalisation position paper by RCC Process so far

Exploring the feasibility of implicit allocation The consultation signalled that stakeholders consider the timing not right to determine the feasibility of implicit allocation Implicit allocation is useful arbitrage instrument if price difference is sufficient Implicit allocation can raise liquidity/ lower transaction costs, improve use of capacity No coordination problem exists or is likely to exist once CAM/CMP are in full swing Gas fired plant is back up for renewables (no sourcing short term cross-border) Avoid a “one size fits all” approach CAM /CMP will improve allocation and use of capacity and will (likely) raise liquidity, lower transaction costs..... thus asses added value once CAM/CMP are up and running.. now focus on development/ implementation of new rules

Exploring the feasibility of implicit allocation NRAs conclusion at SG meeting: CAM and CMP should be up and running before deciding whether implicit allocation should be default CAM and CMP can indeed solve issues related to allocation and use of capacity, thus no full scale implementation until effects are fully known But: implicit allocation can have added value under certain conditions: e.g. sufficient price differences and FAPDs, severe congestion NRAs will identify these conditions in the final position paper. If met, implicit allocation (via pilot) should ideally be explored on that border NRAs are not sure that no coordination problem will exist for Within Day once profiled booking is full swing, time should tell NRAs believe that under the right circumstances (to be identified) implicit allocation can serve as an optimization tool for gas fired plants

Exploring the feasibility of implicit allocation Following the RCC meeting ACM will revise the position paper and (following RCC approval) will publish the position paper 21 April Feedback of RCC on position paper/ EoC 4 April 9 April 16 April 18 April Revised position paper RCC meeting Publication position paper/ EoC Announcement position paper at Madrid Forum

Exploring the feasibility of implicit allocation NRAs within GRI NW will publish three types of document on the GRI NW part on the ACER website once position paper is finalized Final position paper Evaluation of comments  Document explains stakeholder feedback per consultation question and how NRAs within GRI NW treat response Consultation responses  Public consultation responses and minutes of workshop  Document explains final view of NRAs within GRI NW on feasibility of implicit allocation (based upon EoC)