2. RO-HU-AT - a pilot project for incremental capacity
GRI SEE
18 May 2017, Budapest
RO-HU-AT - a pilot project for incremental capacity
How to develop functioning markets?
Infrastructure needs and initiatives for Europe
RO-HU-AT - a key project for Central and South-East Europe

3. Starting Point 2014 Network users indicated non-binding demand for
long term transportation services
potential natural gas supplies originating
from an upstream project initiative
in the Black Sea
from Romania (RO)
via/to Hungary (HU)
and further on to Austria (AT)

4. TSOs: new gas route - ROHUAT

5. TSOs: PCI ROHUAT
Expansion and refurbishment of the existing gas transportation systems

6. Open Season Design Relevant interconnection points (IP)
RO/HU Csanádpalota (IP1)
in both directions
HU/AT Mosonmagyaróvár (IP2)
just in Austrian direction

7. preferred option according to outcome of market survey
Market integration
Allocation Method 3
Outcome market survey of February 2016 (13 answers)
Bundled capacity offered as single years
If demand > offer, capacities shall be allocated on the basis of the highest individual bidder commitment throughout the period of 15 years at IP Csanádpalota and IP Mosonmagyaróvár
Allocation rule core logic:
NU contribution = price IP1 * demanded capacity IP1 * number of years
+ price IP2 * demanded capacity IP2 * number of years
Method 3
preferred option according to outcome of market survey

8. Activities carried out
Consultation phase of the draft OS rule book in December 2016
8 March 2017 in Budapest shipper workshop
Written comments from stakeholders by the end of March about modification of the OS rule book
11/12 April Legal workshop in Vienna with external stakeholders

9. Main milestones
OS Timeline

10. OS Activities 2017

11. OS Activities 2017

12. OS Activities 2017

13. OS Activities 2018
Step back right penalty fee= 0,033% of respective value of individual bid

14. OS Activities 2018

15. OS Activities 2018

16. Examples
Routes & Tariffs

17. Capacity products & tariffs

18. Capacity products & tariffs

19. Tariffs overview (in local currency)
1,6 ~ 2 €/MWh
Entry
0,77 €/kWh/h/y
3,31 €/kWh/h/y
33,3 %
Exit
631,25 HUF/kWh/h/y
786,52 HUF/kWh/h/y
70%
Entry
1483,63 HUF/kWh/h/y
0 HUF/kWh/h/y
70%
Exit
22,45 Lei/kWh/h/y
22,67 Lei/kWh/h/y
70%
Exit
631,25 HUF/kWh/h/y
0 HUF/kWh/h/y
70%
98,72 HUF/MWh
Reserve price Minimum Premium Premium calculation threshold
Entry
22,89 Lei/kWh/h/y
23,12 Lei/kWh/h/y 0%
~ 0,6 €/MWh

20. Project costs overview (in €)
Economic test Total 𝑷𝑽𝒂𝒓 = € f ~ 0,796 PV uc = €
2,69 % m3
𝑷𝑽𝒂𝒓 = €
f = 0,75
PVuc = €
𝑷𝑽𝒂𝒓 = €
f = 0,873
PVuc = €
𝑷𝑽𝒂𝒓 = €
f = 0,75
PVuc = €

21. Ranking of Bids results
Examples
Ranking of Bids results

22. Conditionality
whether the Bidder accepts any partial fulfilment to its Bid in case not the entire amount of capacity applied for could be allocated to the Bidder related to the required quantity (“fill or kill principle”)
and/ or
whether the Bids are linked over both IPs
and/or
whether the Bids are linked across a given number of years
whether the Bid is conditional on the allocation of a minimum amount of capacity.

23. Bid results with overbooking
fill or kill

24. Examples Austrian side
Economic test

25. Determination of the economic viability (Austrian side)
The economic tests (Economic Test I and Economic Test II) for incremental capacity at the entry point Mosonmagyaróvár are based on the following parameters:
PVAR = EUR
f = 0.75
PVUC ≥ EUR
The economic test will be positive if the value of binding commitments of network users is equal to or higher than EUR.
As the allocation of all incremental capacity at the reference price (i.e €/kWh/h/y) would not generate sufficient revenues for a positive economic test outcome, a mandatory minimum premium (i.e €/kWh/h/y) (supplement) is applied for the allocation of the incremental capacity.
The mandatory minimum supplement has been calculated based on the assumption of kWh/h/y minimum booked incremental capacity for 15 years in a row.

26. Determination of the economical viability
Conditions for the calculation of the mandatory minimum premium:
30% of the technical capacity flat booked for 15 years
25% of the total costs socialized on existing IPs of the Austrian system

27. Determination of the economical viability
Tariff composition for the base case

28. Negative economic test

29. Negative economic test
to be reallocated to top of the initial mandatory premium

30. Negative economic test
Increasing of the minimum mandatory premium part of the tariff
∆ +1,64

31. Positive economic test

32. Positive economic test
to be subtracted from the initial mandatory premium

33. Positive economic test
decreasing of the minimum mandatory premium part of the tariff
∆−𝟎,𝟖𝟗𝟐

34. Overall economic tests
The project will be realized if all
the 3 integrated TSO´s related economic tests in direction RO -> AT and HU -> RO will be positive

35. Overall economic tests
The project will be realized if all
the 3 integrated TSO´s related economic tests in direction RO -> AT and HU -> RO will be positive

36.  alessandro.ischia@e-control.at  www.e-control.at  
Contact

38. Determination of the economical viability
base case: generated revenues