ENTSOG BAL NC Monitoring Report 2016

3.6 NEUTRALITY (CHAPTER VII OF BAL NC)

To ensure that it has neither to bear costs stem- ming from network users imbalanced positions nor perverse incentives to intervene or not in the market, TSO shall be neutral to the charges in relation to its balancing activities. Any costs or revenues arising from balancing activities shall be passed by TSO to network users.

Map 8 illustrates that 14 countries (BE, DE, ES, FR, HU, IE, IT, LU, NL, PL, SK, SI, UK-GB and UK-NI) reported implementing neutrality provi- sions, while six countries including Estonia (BG, CZ, EE 46) , EL, LT and PT) partialy implemented them. An overview as well as further details on the partial implementation can be found in Annex VI, tables 6.1 and 6.2 . Two countries (DK  47) , SE  48) ) responded that since the TSO balancing economy is close to be- ing balanced, NRAs have decided not to imple- ment neutrality provisions. In Austria, another neutrality mechanism has been implemented 49) .

The neutrality provisions must be implemented by all countries by 1 October 2016.

a) In Estonia TSO does nor gain or lose by providing balancing

actions, but no separate neutrality charge.

b) The Danish NRA has approved that Energinet.dk does not have to implement the neutrality arrangements, based on two main parameters: 1) the balancing economy is close to being balanced and 2) the economy of Energinet.dk is a rest-in-itself economy, and is thereby neutral in itself.

In Sweden it has been reported that the amounts gained or lost due to balancing actions are almost negligible.

Other neutrality mechanism implemented by 1 October 2016 b)

Neutrality mechanism implemented by 1 October 2016 Neutrality provisions partially implemented by 1 October 2016 a)

Under discussion

a) In Estonia TSO does nor gain or lose by providing balancing actions, but no separate neutrality charge. b) The Danish NRA has approved that Energinet.dk does not have to implement the neutrality arrangements, based on 2 main parameters: 1) the balancing economy is close to being balanced and 2) the economy of Energinet.dk is a rest-in-itself economy, and is thereby neutral in itself. In Sweden it has been reported that the amounts gained or lost due to balancing actions are almost negligible. Map 8: Neutrality implementation by 1 October 2016

46) EE: TSO does nor gain or lose by providing balancing actions, but no separate neutrality charge. 47) DK: The Danish NRA has approved that Energinet.dk does not have to implement the neutrality arrangements, based on 2 main parameters: 1) the balancing economy is close to being balanced and 2) the economy of Energinet.dk is a rest-in-itself economy, and is thereby neutral in itself. 48) SE: The amounts gained or lost due to balancing actions are almost negligible. 49) In case of a daily imbalance > 24 MWh, balancing actions per balance group are triggered by MAM in the name and on behalf of the BGR. No costs/revenues for the MAM, the BGR pays/receives the market price to/from the VTP. Hourly short imbalanced positions with short Market Area Position and short Carry forward account will be charged by balancing incentive markup. Finally, a last line of defence for balancing is to curtail imbalanced balance group, which causes network instability. Those balancing incentive markups generate income, which is accumulated and used to reduce transmission charges in future periods. As the balancing incentive markups were massively reduced since their introduction, the effect in total is small. As the MAM did not take measures for physical balancing, the total sum of the balancing incentive markup for 2013–2015 was returned to the network users via lower tariffs.

ENTSOG BAL NC Monitoring Report 2016 |

29