ENTSOG Tariff NC - Implementation Document 2nd Edition

In table 41, the objective is that TSOs A and B collect sufficient revenues after the Inter-TSO Compensation (ITC) mechanism adjustment in order to get their allowed revenues of 70M€ and 65M€. In the joint RPM application presented here, the value of the ITC is determined by the RPM (in some other cases, it might be set before the application of the RPM). The joint allowed revenue is first calculated (135M€). Then, as in Part I, tariffs are calculated in the case of the postage stamp RPM and following the rules of the CWD counterfactual. But from now on, calculations are made first at the joint level. \\ For postage stamp, entry (resp. exit) tariffs are derived for the merged TSO by multiplying the joint allowed revenue and the new entry (resp. exit) share of revenues, and dividing the result by the new total forecasted entry (resp. exit) bookings. Tariffs are identical for all points in entry and all points in exit: this is a result of postage stamp. This is shown in the table below.

TARIFFS – €/(kWh/h)/a

Postage Stamp

CWD

Entry A2

4.82

3.03

TSO A

Exit Dom A3

4.82

5.10

Exit A4

4.82

6.52

Entry B1

4.82

5.12

TSO B

Exit Dom B2

4.82

3.32

Table 46: Tariffs after the merger (joint case)

\\ For CWD , again it is necessary to consider distances between points, with the same assumptions on distance calculations as before. Tariffs derived with the CWD RPM are presented in the above table, but the steps to calculate them are developed below. Compared to the separate application, there is one single distance matrix to consider in the joint application.

DISTANCE MATRIX

Exit Dom A3

Exit A4

Exit Dom B2

Entry A2

450

450

900

joint application

Entry B1

1,000

1,300

550

Table 47: Distance matrix after the merger (joint case)

But now, calculations consider distances for the joint entity made of the 2 TSOs. This means that the methodology is applied for the joint entity made of TSOs A and B. In the previous configuration (before the merger), it was not necessary to consider the distance between e. g. Entry A2 from TSO A and Exit B2 of TSO B. By contrast, the joint application in a merged entry-exit system requires that points from A and from B are considered together for flow scenarios. The figure below represents the merged entry-exit system with indication of distances for the application of CWD.

TAR NC Implementation Document – Second Edition September 2017 | 219