Power Exchanges in the extended EU The experience in Czech Republic APEx Conference 2004 October 11...

Power Exchanges in the extended EUThe experience in Czech Republic

APEx Conference 2004

October 11th, 2004 - Leipzig

Miroslav Marvan Operator trhu s elektrinou, a.s.

Czech Power Industry in 2003

Total Consumption 55 TWh

Export 16 TWh

Import 4 TWh

Net Generation 83 TWh

incl. Thermal PPs 53 TWh

Nuclear PPs 26 TWh

Maximum Peak Load 11 163 MW

Main Market Participants

Share of generation Share of electricity supply

(distribution)

ČEZ 70 % 66 %

EON 24 %

PRE 10 %

There exists one dominant generator with crucial share of generation and distribution as well.

Opening the Electricity Market in the Czech Republic

Wholesale electricity market completely opened At present retail market is opening step by step Today the electricity market is opened for all generators,

traders and end consumers with continuous measurement and remote data transport

From 1.1.2005 the market is opened for all end consumers with exception of residential sector – implementation of load profiles

OTE TSO

DSO1

Bilateral contracts

ccontractscontalou

vy Contracted volumes

Actual volumes

volumesdnoty

DSO2

BRE Balance Responsible Entities - Subjects of settlement DSO Distribution System Operator TSO Transmission System Operator OTE Electricity Market Operator

BRE1 BRE2

BRE3

Model of Czech Electricity Market

*DSO can become a subject of settlement

*

*

Model of Czech Electricity Market

A subject of settlement (BRE) - at present 30 in the Czech Republic - is a market participant with responsibility (financial) for a deviation

Deviation is a difference between actual (measured) and contracted (traded) volume of electricity

Deviation of a subject of settlement

BRE Deviations

Contractedvolumes

Actualvolumes

OTE

TSO/DSO

ddp

ki

s

kiki ,,,

dp

ki,

ds

ki ,

ki ,

Electricity Market Operator

Evaluates and settles deviations - every day for separate trading hours

Receives contracted (traded) hourly volumes from subjects of settlement in a day D – 1 (by 16:00) and real (measured) volumes for every hour in a day D + 1 (by 11:00) from TSO and DSOs

Deviations are evaluated by financial costs necessary for activation of ancillary services (reserve power)

Deviations are debeted to these subjects of settlement that caused deviations in separate trading hours

Further Activities of Electricity Market Operator

Organizes day – ahead market – by very traditional way Organizes intra – day market; for separate trading hours;

at present trading ends 3 hours before real time Organizes balancing market – with single buyer only –

TSO Risk management of electricity market Administration of changes of suppliers In preparation: registration and settlement of „green

electricity“ and CO2 emissions

Reconciliation curves

29 September 2004 – 23:00 – 24:00

Evaluation of Czech Electricity Market

The electricity market in the Czech Republic started in 2002 without notable problems

Trades of dominant generator ČEZ, a.s. have crucial importance for price – fixing process

Low liquidity of organized electricity market - day – ahead and intra – day markets about 1 %

Bilateral contracts represent predominated way of trading

What next?

It is impossible to increase liquidity of organized market and competition under existing conditions

Strategy for improvement of electricity market with existence of dominant players:

- creation of a regional market

- first step – preparation of infrastructure of the market

Regional Electricity Market

At present very popular idea Solution is concentrating on solution of cross – boarder

flows which is insufficient The problem is more serious

– the same rules for trading– the same rules for regulation– provision of reliability of electricity supply

Primarily it is a political problem

Infrastructure of Electricity Market

There have to exist an infrastructure independent on market players and dominant players especially

- measurement and access to its results

- settlement of deviations and their prices

- administration of supplier (consumer) changes

- trades in ancillary services

- additional conditions that depend how the market

was started (e.g. in the Czech Republic obligation

for EMO to organize day – ahead market)

Conclusion

More information about the Czech electricity market – even in English - is available on web sites of OTE

www.ote-cr.cz

including results of day - ahead market, intra – day market and balancing market and statistical data

Power Exchanges in the extended EU The experience in Czech Republic APEx Conference 2004 October 11...

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