ENTSOG Tariff NC - Implementation Document 2nd Edition

The TAR NC states that the discount ‘may be’ different at different IPs. The discount can therefore be the same at all IPs, at some IPs, or it can differ from one IP to another. Pro factor ‘Pro’ is the probability of interruption, calculated in accordance with the following formula:

CAP CAP av.int

Pro = × N × D int D

Where: N

is the expectation of the number of interruptions over D;

D int

is the average duration of the expected interruptions expressed in hours;

D

is the total duration in hours of the respective type of standard interruptible capacity product; is, for each interruption, the expected average amount of interrupted capacity related to the respective type of standard interruptible product; is the total amount of interruptible capacity for the respective type of standard capacity product for interruptible capacity.

CAP av.int

CAP

The detail in the above formula seeks to improve transparency by specifying all components. The TAR NC envisages separate calculation of the Pro factor for every type of standard interruptible capacity product offered. The CAM NC establishes five categories of standard capacity products: yearly, quarterly, monthly, daily and with- in-day. For interruptible capacity, the TAR NC deals with ‘types’ within the same category of standard capacity product. Various ‘types’ of products differ in their probability of interruption  1) . Such types can be the same at all IPs, at some IPs, or they can differ from one IP to another. An adjustment factor ‘A’ applies to reflect the estimated economic value of the type of standard interruptible capacity product. In practice, it reflects that the costs of hedging interruption for a network user are higher than the probability of interrup- tion. Therefore, factor ‘A’ should help to increase the ex-ante discount if needed to reflect the actual value of the capacity. As with the Pro factor, the TAR NC contemplates separate calculation of the ‘A’ factor for every type of standard interruptible capacity product offered. If the economic value of such products is the same then the level of the A factor can be the same. In addition, the TAR NC permits the calculation of the ‘A’ factor for each, some or all IPs. The ‘A’ factor can be the same at all IPs, at some IPs, or it can differ from one IP to another. Please see Annex N for an example of an ex-ante discount for a given monthly standard interruptible capacity product. ‘A’ factor

 1) For example, there can be two yearly interruptible capacity products offered one with the probability of interruption 0.2 and the other with the probability of interruption 0.4.

86 |

TAR NC Implementation Document – Second Edition September 2017