ENTSOG Tariff NC - Implementation Document 2nd Edition

ARTICLE 15 SEASONAL FACTORS METHODOLOGY

Responsibility: the level of seasonal factors and the calculations per methodolo- gy are subject to consultation per Article 28(1) by NRA; subject to decision by NRA

General Seasonal factors can be applied in addition to the multiplier to calculate reserve prices for non-yearly products. Examples of the rationale for applying seasonal factors can be: \\ To foster efficient system use by allowing higher reserve prices in months with high utilisation rates, and lower reserve prices in low-utilisation months. ENTSOG considers that such pricing: (1) provides incentives to shift gas flows away from high demand periods; (2) reduces the negative impact that profiled capacity bookings may have on revenue and tariff stability; and (3) avoids additional unnecessary investment, by encouraging network use in summer and discouraging it in winter. \\ To increase security of gas supply by allowing different reserve prices between the winter and the summer period, encouraging gas supplies well in advance of the peak demand period. This example has been added further to stakeholder feedback. The TAR NC methodology to calculate seasonal factors considers the monthly utilisation rates of the transmission system. Based on feedback at the TSO/NRA internal workshop and internal ENTSOG discussions, all forecasted flows/contract- ed capacity for a given month should be taken into account when calculating the seasonal factors, as using the monthly utilisation rates based on monthly products alone would give an incomplete picture of system usage  1) . Different options exist for seasonal factors: TSOs can apply the same set of seasonal factors to all IPs, the same set of seasonal factors to a group of IPs, or a different set of seasonal factors per IP. TSOs will evaluate which approach is more appropriate to foster efficient use of the system. Following the Article 15 methodology for calculating seasonal factors, the 12 seasonal factors for total monthly system usage provide the basis for calculating the seasonal factors for the other three capacity products: quarterly, daily and within-day. Therefore, there are four seasonal factors for quarterly products; 12 seasonal factors for monthly products, 12 seasonal factors for daily products and 12 seasonal factors for within-day products. The seasonal factors of all quarterly products are different, the seasonal factors for all daily products of a given month are the same, and the seasonal factors for all within-day products of a given day in a given month are the same. For a description of the detailed steps in the seasonal factors methodology, please see Annex L. For an example of calculating the seasonal factors, please see Annex M.

 1) The data for all the forecasted flows/contracted capacity for a given month is used when calculating the seasonal factors, not just the flows/contracted capacity related to monthly products.

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TAR NC Implementation Document – Second Edition September 2017