BritNed Participants Forum. 12 October 2017 London

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1 BritNed Participants Forum 12 ober 2017 London

2 Programme 10:30 12:00 Introduction Commercial Update Operational Update Brexit 12:00 12:45 Lunch 12:45 14:00 Implementation of the Internal Energy Market Open Forum/Questions 14:00 15:00 Networking Session 2

3 Commercial Updates Yvonne Visser, Commercial Director BritNed Participants Forum 12 ober 2017

4 Agenda Highlights of the last 12 months Looking forward 4

5 Highlights of the last 12 months Strong operational performance, hardly any unplanned unavailability! Only 6 hours in January, but with no curtailments and 2 weeks ago 4 hours. The severe winter situation in CWE region. BritNed capacity affected only, not customer s capacity rights. Kingdom performance: in April, unfortunately 1 last minute cancellation of an Explicit ID auction, due to external circumstances. Successful cloud migration of Kingdom. Submission of final HAR s including Firmness regime. NRA approval expected mid- ober, applicable as of 1 January BREXIT: UK government handed in the art. 50 letter, 2-year negotiation period started. BritNed is preparing contingency plans. 5

6 Highlights of the last 12 months Progress made re. Regional (Nomination) Platform / Single Allocation Platform, XBID, multi NEMO arrangements Customers surveys performed in view of transition to JAO as Single Allocation Platform Product development: introduction of Fast Track on boarding process, preparing possibility of nominations on behalf, assessing the possibility of Implicit Intraday Auctions Customer Account Team has sought alignment with you at E-MART, E-World, during bi-laterals and surveys 6

7 Looking ahead Ensure BritNed is prepared for Brexit scenario s and engage with relevant stakeholders (ministries, regulators, customers, TSO s, etc.) Continue implementation of CACM & FCA requirements, but without irreversible consequences Continue development and implementation of the Regional Nomination Platform, prepare for potential transition to SAP / JAO Continue high operational and commercial availability and reliability Keep on trading! 7

8 Thank you for listening Yvonne Visser, Commercial Director BritNed Participants Forum 12 ober 2017

9 Operational Update Kevin Rendell, Operations Director BritNed Participants Forum 12 ober 2017

10 Safety and Environment Continued focus on Safe operation of the link - zero Lost Time Injuries since start of operation 2,374 days No Environmental incidents to report Updated Safety Management System Installation of EC cooling fans at Maasvlakte Reduce energy consumption of fans by more than 75% (400,000 kwh p.a.) 10

11 Technical Performance Last 12 Months 1 x short notice 6 hour planned outage May planned outage September planned outage & short notice 4 hour outage 100% 90% 80% 100% 100% 100% 99.47% 100% 100% 100% 89.91% 100% 100% 100% 92.08% 70% 60% 50% -16 Nov-16 Dec-16 Jan Mar-17 Apr-17 May Jul-17 Aug-17 Sep-17 Overall Technical Performance ( 2016 to Sep 2017) 98.4% Unavailability due to planned outage 1.46% Unavailability due to unplanned outage 0.09% 11

12 2017 Performance and Outage Management 2016 Annual Availability 98.1% Best performance since start of operation 2017 On target for c.98.4% availability Jan 2017 Short notice 6 hour monopole planned outage Water leak 12

13 2017 May outage 4 days (3 days bi-pole, 1 day monopole) Checked pipework and bolts causing problems in January 17 Completed fitting of 4,560 filters into the valve cooling system to mitigate problems seen last year 13

14 2017 September outage planned for 4 days (2 days bi-pole; 2 days monopole) Transformer overhaul work Grain Converter Transformer overhaul work on Grain Pole 1 deferred to next May due to technical issues able to return to full power one day early 14

15 30 th September Short Notice planned outage Structural issues with a Lightening Conductor at Grain - 4 hours short notice planned outage. 15

16 2018 and beyond Continue rigorous focus on safety of our people and the plant. Review and update asset management strategy Continue international collaboration with other interconnector operators and owners Continue to collaborate and build relationship with our key strategic suppliers Work with Commercial colleagues and customers to understand operational impact of Brexit and services we provide. 16

17 17

18 Thank you for listening Kevin Rendell, Operations Director BritNed Participants Forum 12 ober 2017

19 Brexit Yvonne Visser, Commercial Director BritNed Participants Forum 12 ober 2017

20 Brexit, what does it mean for BritNed? For both market parties as for BritNed, clarity is essential! March 2017, Theresa May sent in the notice of exiting the EU. As a consequence a 2-year period to arrange for the separation has started. In March 2019, the UK will formally leave the EU. Message from BEIS / Ofgem and Dutch Ministry of Economic Affairs: Make sure you have a contingency plan timely in place. At this moment, it is unclear if the UK will be able to stay in the Internal Energy Market or not. What does this mean for BritNed and for trading on BritNed? The answer is in essence simple: we need to and will ensure that our capacity remains available to the market and that you can continue to trade on BritNed! How will we enable that? We have identified several possible scenario s that we will discuss and align with you and our regulators. 20

21 Brexit, what does it mean for BritNed? Potential contingency scenario s UK remains in IEM Long Term Rights Day Ahead Market Coupling Intraday Capacity Nominations of LTR s Curtailments (if any) Trading solution RNP / SAP Timeline of transition: depending on clarity. At the earliest Q3/Q NEMO s No change foreseen BritNed is assessing the possibility of implicit Intraday Auctions in the course of 2018 (Q2/Q3 2018), as an intermediate step towards XBID (expected in Q1/Q2 2019) Via RNP Via RNP 21

22 Brexit, what does it mean for BritNed? Potential contingency scenario s UK exit IEM Scenario 1 Scenario 2 Long Term Rights Day Ahead Intraday Auctions Kingdom (no transition to RNP/ SAP) Potentially explicit via Kingdom Implicit auctions via PX and/or Explicit via Kingdom Nominations Kingdom RNP Curtailments (if any) Kingdom RNP RNP / JAO under an SLA comparable to SAP Implicit as long as possible via NEMO, transition to Explicit auctions via JAO Implicit auctions via PX and/or Explicit via JAO BritNed is investigating if implicit DA is still possible, outside the MC We would like to hear your views regarding these scenario s 22

23 Thank you for listening Yvonne Visser, Commercial Director BritNed Participants Forum 12 ober 2017

24 Programme 10:30 12:00 Introduction Last Year s Updates Operational Update Brexit 12:00 12:45 Lunch 12:45 13:30 Implementation of the Internal Energy Market 13:30 14:00 Open Forum/Questions 14:00 15:00 Networking Session 24

25 Implementation of the Internal Energy Market (IEM) Jan Hoogstraaten, Regulatory Manager Ivo de Vries, Project Manager Rob van der Velden, Manager Auctions & Product development BritNed Participants Forum 12 ober 2017

26 Today s storyline 1. Recap 2. Today a year ahead 3. Long term horizon Proposals for SAP, FCA HAR's & Long term products 4/17/2017 Submission Access Rules /1/2017 Entry into force FCA 10/17/2016 Decisions on SAP, FCA HAR's & Long term products 10/16/ /1/2017 Introduction Fast Track 8/1/2018 Go Live SAP & RNP 1/1/2018 FCA HAR's and Access Rules 2018 effective 4/1/2019 Expected Go Live XBID 26

27 1. Recap 2. Today a year ahead 3. Long term horizon What has been done so far? 1. Rules and methodologies a) Preparation of rules and methodologies necessary for Firmness Single Allocation Platform and Long term products Intraday Capacity Pricing Implicit Intraday Fast Track registration b) What has been changed? Harmonised Allocation Rules & Border Specific Annex Access Rules Participation Agreement 2. FTR s discussion and Fast-Track registration 3. Regional Nomination Platform 27

28 1. Recap 2. Today a year ahead 3. Long term horizon What s to be expected? 1. New rules 2018* a) Firmness and compensation b) Nomination on behalf 2. Single Allocation Platform (phase 1)* a) Design and development b) Long Term Products c) Transition and Go Live 3. Regional Nomination Platform a) Development b) Transition and Go Live 4. Exploration Implicit Intraday * Subject to NRA approval 28

29 1. Recap Today a year ahead 3. Long term horizon 2019 Firmness 2018: FCA HAR, Border Specific Annex & Access Rules With firmness the capacity holder always receives the market value of their capacity, either via remuneration (exchange) or compensation (BritNed). How does BritNed offer a firm product: 1. Annual product includes reduction periods. Annual product (355) = 365 days reduction period (10) for planned outage. 2. Curtailment and triggering events a) Emergency Situation (ES) b) Force Majeure (FM) c) Operational Security Limits (OPS) 3. Compensation is not limited any longer to fixed Market Spread Caps. NL-GB = 17.9 GB-NL =

30 1. Recap Today a year ahead Compensation of Long Term Rights in a nutshell: Time Frame Allocation Pre DAFD Compensation 2018 Implicit OSL & FM Market Spread Explicit OSL Market Spread Explicit FM WAMP Post DAFD Implicit Trigger ES & FM Market Spread Explicit ES Market Spread Explicit FM WAMP 3. Long term horizon 2017 = WAMP 2018 = Market spread Compensation 2017 WAMP Capped Market Spread NL-GB = 17.9 GB-NL = 11.4 Day Ahead Firmness Deadline: (60) minutes before Market Gate Closure Time 12:00 CE(S)T. 2018: if Market Spread cannot be calculated WAMP. Monthly Cap = total congestion revenue of the relevant month

31 1. Recap Today a year ahead 3. Long term horizon 2019 Nomination on behalf 31 In 2017 BritNed began with the possibility to offer Fast-Track registration. Why Fast Track? Avoids the administrative burden to become Programme Responsible Party in NL, as BritNed previously required. Fast Track participants cannot nominate In 2018, the Access Rules provided the possibility for Nomination on behalf. This allows the Fast Track participant to transfer its programme responsibility in NL to a Programme Responsible Party (third party) authorised by TenneT. BritNed will further develop the Nomination on behalf

32 1. Recap Today a year ahead 3. Long term horizon Future process for auctions and nominations SAP DA Implicit (MRC) Market Participants XBID / Implicit ID RNP

33 1. Recap Today a year ahead 3. Long term horizon Single Allocation Platform a) Development 1. JAO started design with their IT Vendor, this is planned to be finished by December. 2. Development and implementation is planned between January and May Client testing is planned between May and e b) Long term products 1. Phase one: Annual, Seasonal, Quarterly and Monthly. 2. Phase two: Weekly and Weekend. c) Transition and Go Live 1. We are in preparation for a smooth transition from Kingdom to SAP. 2. Transition is highly linked with RNP transition. 3. Go-Live is planned towards 1st of August

34 1. Recap Today a year ahead 3. Long term horizon Regional Nomination Platform a) Development 1. We are currently in the middle of the Design and Engineering phase of the project. 2. Development and implementation is planned between November and April Client testing is planned between April and e b) Transition and Go Live 1. We will start customer engagement during development and implementation phase. 2. We are in preparation for a smooth transition from Kingdom to RNP. 3. Transition is highly linked with SAP transition. 4. Go-Live is planned towards 1st of August

35 1. Recap Today a year ahead 3. Long term horizon 2019 Regional Nomination Platform & Single Allocation Platform timeline Mobilisation Engineering Development Testing Go-Live Requirements Design Development Testing Go-Live Apr Aug Dec Apr 2018

36 1. Recap Today a year ahead 3. Long term horizon Implicit Intraday We re exploring the possibilities to implement an Implicit Intraday solution with Single Intraday Coupling a) b) c) d) Potential intermediate step towards XBID Access rules have been amended Procedure to select partner via a Request for Offer Analysis for optimal auction structure (currently ongoing) We ll keep you up to date on any further developments

37 1. Recap Today a year ahead What do we further foresee? 1. Single Allocation Platform (phase 2) a) Design and development b) Long Term Products c) Go Live 2. XBID a) Intraday Capacity Pricing b) Developments Long term horizon 2019

38 1. Recap Today a year ahead 3. Long term horizon Single Allocation Platform a) Design and Development 1. JAO will focus on first Go-Live in 12 months after approval of the SAP Proposal. 2. Development of new additional products and requirements will follow. 3. Requirements for design will already be drafted. b) Long term products 1. Phase one: Annual, Seasonal, Quarterly and Monthly. 2. Phase two: Weekly and Weekend. c) Go Live 1. High level estimation is maximum 12 months development after Go-Live phase

39 1. Recap Today a year ahead 3. Long term horizon 2019 How is Intraday Capacity Pricing foreseen? 39 Implicit auction before start of continuous matching to provide correct price for cross border capacity In the current proposal it s optionally possible to define the IDZGOT before 22:00 but this will not be done by BritNed There shall be at least 1 IDA (D-1 22:00) but potentially 2 which is dependent on the future CCR methodology (the picture below includes IDA2 which is taken into account in the indicative CZIDCP proposal ). Results will be published 30 minutes after the action (22:30 / 10:30)

40 1. Recap Today a year ahead 3. Long term horizon 2019 XBID Developments The XBID Market project is seen as the pilot project for implementation of the target model of intraday trading solution according to CACM European Network Code. The project should develop and establish an integrated cross-border intraday continuous trading solution. Continuous trading Submitted buy/sell orders will be either executed (i.e. matched) immediately or entered into the order book with certain validity. The order book is made available to all users with the rights to access a delivery area where the order is relevant. Trading is opened in D-1 for the whole following day. Trading for each MTU is closed 60 minutes before the delivery period. Immediate Netting Real time netting mechanisms will be implemented to ensure maximum available capacities (amount of allocated capacity in direction A->B will be immediately added into offered capacity in B->A direction). The capacity becomes firm once allocated (after the match of sell-buy order). Missing Capacity Pricing as requested in CACM. Missing losses functionality. Go-live of first LIPs is expected in March BritNed is not part of first go-live.

41 Thank you for listening Any questions? Jan Hoogstraaten, Regulatory Manager Ivo de Vries, Project Manager Rob van der Velden, Manager Auctions & Product development BritNed Participants Forum 12 ober 2017

42 Open Forum/Questions Mike Denny, European Account Manager BritNed Participants Forum 12 ober 2017

43 Coming up E-World, Essen in ruary 2018 Bi-laterals Site visits Isle of Grain and Maasvlakte Converter Stations 43 Kingdom training

Participants Forum 2014

Participants Forum 2014 Programme of the day 13.15 hrs Introduction 13.30 hrs Intraday 14.15 hrs Survey Results 14.30 hrs BritNed Operational Updates 15.00 hrs Tea / Coffee break 15.15 hrs New code 15.45