Oil & Gas

ACER reports on contractual gas congestion at interconnection points

The Agency recently published the fifth edition of the Annual Report on Contractual Congestion at Interconnection Points. Contractual congestion occurs when the demand for firm entry or exit capacity services exceeds the offered capacity. In 2017, congestion has been detected at less than 7% of the entry and exit sides of the Interconnection Points (‘IPs’) within the EU Gas Transmission Network. This report includes the list of contractually congested IPs where the Firm Day Ahead Use-It-or-Lose-It (‘FDA UIOLI’) mechanism has to be implemented and applied to address congestion at the relevant IPs. It also reveals to what extent the other Congestion Management Procedures (‘CMP’) have been applied in the European Union and the amount of additional capacity yielded through their use.

The findings of this report are based on the analysis of data from ENTSOG’s Transparency Platform (TP) for 2017 – 2019, and data from the three capacity booking platforms (GSA, PRISMA, and RBP), using the auction reports for the calendar year 2017.

Contractual congestion was identified at 17 IP sides, out of which 9 had already been found congested in 2016 (in 2015 and 2014 they were 10 and 6 respectively). For 11 IP sides, contractual congestion was triggered by the non-offer of firm products with the duration of at least one month, whereas the emergence of auction premia and unsuccessful requests indicated contractual congestion for 6 IP sides. 12 out of the 17 contractually congested IP sides are cross-border IPs between Germany and its neighbours and at inland German IP sides. Further 3 IP sides were congested in the South-South East Region.

Compared to last year’s Congestion Report, where 23 IP sides out of 247 were detected contractually congested, this year, only 17 out of 262 IP sides were congested. At the congested points, one IP side applied Surrender, and no application of Oversubscription & Buy Back has been identified.

Secondary capacity trades have been concluded only for five congested IP sides in 2017, compared to seven in 2016.

For the five congested IP sides where the FDA UIOLI has still not been implemented and the Austrian IP side, where FDA UIOLI was not duly reported, National Regulatory Authorities (‘NRAs’) shall take the relevant measures, which include: to require TSOs to implement and apply the FDA UIOLI mechanism or prove that the congested situation is unlikely to reoccur in the following three years.

 

ACER’s main recommendation to NRAs, ENTSOG and TSOs

  • Improve data reliability: CMP data availability needs to be further improved by ENTSOG/TSOs, by ensuring that auction results with premia and data on all non-available capacity products are uploaded on the ENTSOG’s TP, as required by the CMP Guidelines. The list of CAM relevant IP sides needs to be validated to ensure a correct list of IP sides that have to be evaluated in the congestion report.

 

ACER’s recommendations to the European Commission

  • Revise the CMP Guidelines to enhance the effectiveness of the measures.
  • Review the criterion d) of paragraph 2.2.3(1) of the CMP Guidelines to align it with the other congestion criteria.
  • Establish a date after which the Agency no longer has to produce a congestion report.
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