Regulatory foundations for a Mediterranean RES exchange platform

1. Florence School of Regulation
Regulatory foundations
for a Mediterranean RES exchange platform
Jean-Michel Glachant
Director Florence School of Regulation
& Professor “Loyola de Palacio EU Energy Chair”
MEDGRID GA, Paris 15 March 2012
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2. Why do „Regulation Working Group“
meets today… and tomorrow?
*To discuss a regulatory platform…
…for growing RES exchange between North and South Mediterranean shores
*North Shore starting point:
EU internal market under construction since 20 years BUT near to achievement
(2014) >> more demanding common market and grid rules
*South Shore:
no similar internal market move BUT growing appetite for RES “gold mine”
*How to ++ exchange between so different universes? Look for platform??
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3. North: the EU internal market basics
Entry in generation and access to grids
Since 1996: all generators (old or new) can access all regulated grids in all EU
Interconnection usage and connection of markets
Later on:
*Interconnections allocated only with market based methods
*Revenues of interconnection auctions ‘parked’ for regulated purposes
* ’Implicit’ auctioning of interconnection as prefered method (‘Market Coupling’)
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4. North: the EU RES basics
RES generation is subsidized in any country
Trough national schemes (generally feed-in tariffs)
RES have priority everywhere in any country
As
*Dispatch (= pushed into the system and into the consumers’ mouth)
*Access to the grids (connection; congestion)
*Indirectly: access to interconnections (preceed voluntary exchange through
‘Market Coupling’)
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5. South: the internal marketS basics
Entry in generation and access to grids
*How IPPs invest & connect [when not generating PPA with state monopoly]
*How IPPs generate and inject [when not generating PPA with state monopoly]
*Congestion management, balancing rules, losses, tariffs, maintenance: access to
transformers and stations,
Interconnection usage and connection of markets
*How interconnections allocated to IPPS [when not generating in PPA with state
monopoly] Import export monopoly? Third Party access?
*Congestion, balancing, losses, tariffs, - nominations, measurement etc.
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6. South: the RESs basics
RES generation for export?
Facility, revenues and export taxes; grid tariff, connection tariffs; metering, losses
and balancing rules and costs
RES any priority anywhere?
*Access to the grids: connection to existing; extension of grids
*Dispatch, grid congestion
*Interconnection allocation and ruling
*RES generated in country / RES in transit
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7. 3 working axes: North / South basics
W1- North own Upstream (inside EU)
*Access to interconnection for “transit RES” – priority? – tariff?
*Nomination and measurement rules for ‘transit RES’ balancing – settlement?
W1- North own Downstream (inside EU)
*’RES nature’ certification requirements
*Measurement of RES volume being RES for the ‘downstream’ support scheme
* Adaptation of the ‘downstream’ RES support scheme to the particular cost
profile of these ‘upstream’ RES generation
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8. 3 working axes: North / South (Cted)
W2- South own Upstream (on the South shore)
*Entry conditions for green IPP ** Green facility certification
*Measurement of greeen generation output and green injections into the grid
W2- South own Downstream (on the South shore)
*Access to grids (connection conditions – tariffs)
*Congestion management, dispatch prioirty, balancing rules
* Access to interconnections (priority – green transit certification – tariff and
taxes)
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9. 3 working axes: North / South (End)
W3- North to South and vice versa: new interconnection development
*Framing a new interco: intergovernmental framing; legal and regulatory
agreement and licensing, va-et-vient Member State – European Commission
*Planing a new interco: TSOs development plans; planning approval; financing;
cost sharing; EU Infrastructure Package: PCIs; EU 3d Package: TYNDP
*Connection rules; grid extension rules and costs (shallow costs; deep costs)
W3- North to South and vice versa: new interconnection usage
* Relations with ‘local grids’: capacity calculation and allocation; ‘Swedish’ risk?
* EU regulation or exemption? Capacity allocation and congestion revenue.
Merchant line vs Hybrid frame
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