ENTSOG TYNDP 2017 - Annex F - Methodology

TYNDP 2017 Annex F Assessment Methodology

TYNDP 2017 Annex F Assessment Methodology

6.4 MONETISATION PER ZONE –

PRICE SPREAD CONFIGURATION

The monetisation per Zone for price spread configuration is calculated for one infra- structure level relative to another. Monetisation per Zone - Price Spread Configuration 6.4. The monetisation per Zone for price spread configuration is calculated for one infrastructure level relative to another. Basic principle A split of the difference in the EU bill is calculated between what can be directly allocated, and what cannot. The unallocated part will be split based on the difference of marginal prices between the two configurations, weighted by the demand. Monetisation per Zone - Price Spread Configuration 6.4. The monetisation per Zone for price spread configuration is calculated for one infrastructure level relative to another. Basic principle A split of the difference in the EU bill is calculated between what can be directly allocated, and what cannot. The unallocated part will be split based on the difference of marginal prices between the two configurations, weighted by the demand. Basic principle A split of the difference in the EU bill is calculated between what can be directly al- located, and what cannot. The unallocated part will be split based on the difference of marginal prices between the two configurations, weighted by the demand. Detailed process In the following description, the term ∆(quantity) is used to design the difference in the values of a given quantity between two configurations (for instance LOW and AD- VANCED). ∆(quantity) is used to de ign he difference in th values Detailed process In the following description, the term ∆(quantity) is used to design the difference in the values of a given quantity between two configurations (for instance LOW and ADVANCED). First the difference of the adjusted EU Bill is computed: EU Bill Difference = ∆("Total EU B i ll adjusted Price Spread") Step 1: Allocation based on “Price Spread Adjustment Gain” In the modelling results, a quantity named "Price Spread Adjustment Gain" is available for each Zone. This quantity is computed ex-post. It is the amount by which the bill in the country would drop following an import price spread adjustment as a consequence of the import flow reaching the minimum flow threshold. Any difference in the “Price Spread Adjustment Gain” can be allocated directly to the corresponding Zone.  For each Zone, compute the directly allocated bi l differenc Zone direct allocation = − ∆(Price Spread Adjustment Gain)  Compute the sum of the previous quantities (Labelled afterwards as “ ill Diff rence Allocated”) TYNDP 2017 Annex F Assessment Methodology TYNDP 2017 Annex F Assess ent ethodology m t M t l TYNDP 2017 Annex F Assessment Methodology EU Bill Diff re ce Unallocated = EU Bill Difference − EU Bill Difference Allcoated Step 2: Allocation of the unallocated part based on the marginal prices First the difference of the adjusted EU Bill is computed: Step 1: Allocation based on “Price Spread Adjustment Gain” of a given quantity between two configurations (for instance LOW and ADVANCED). First the difference of the adjusted EU Bill is computed: EU Bill Difference = ∆("Total EU B i ll adjusted Price Spread") Step 1: Allocation based on “Price Spread Adjustment Gain” In the modelling results, a quantity named "Price Spread Adjustment Gain" is avail- able for each Zone. This quantity is computed ex-post. It is the amount by which the bill in the country would drop following an import price spread adjustment as a con- sequence of the import flow reaching the minimum flow threshold. Any difference in the “Price Spread Adjustment Gain” can be allocated directly to the corresponding Zone. \\ For each Zone, compute the directly allocated bill difference In the modelling results, a quantity named "Price Spread Adjustment Gain" is available for each Zone. This quantity is computed ex-post. It is the amount by which the bill in the country would drop following an import price spread adjustment as a consequence of the import flow reaching the minimum flow threshold. Any difference in the “Price Spread Adjustment Gain” can be allocated directly to the corresponding Zone.  For each Zone, compute the directly allocated bill difference Zone direct allocation = − ∆(Price Spread Adjustment Gain)  Compute the sum of the previous quantities (Labelled afterwards as “EU Bill Difference Allocated”) \\ Compute the sum of the previous quantities (Labelled afterwards as “EU Bill Difference Allocated”) \\ Compute the unallocated part of the EU Bill (Labelled afterwards as “EU Bill Difference Unallocated”)  Compute the unallocated part of the EU Bill (Labelled afterwards as “ EU Bill Difference Unallocated ”)  Compute the unallocated part of the EU Bill (Labelled afterwards as “ EU Bill Difference Unallocated ”) EU Bill Difference Unallocated = EU Bill Difference − EU Bill Difference Allcoated Step 2: Allocation of the unallocated part based on the marginal prices  For each Zone, compute the maximum possible consumer surplus Zone Max Consumer Surplus = demand ∗ ∆(Zone marginal price)  For each Zone, compute the key to allocate the remaining part of the EU Bill difference Zone Key Split = Zone Max Consumer Surplus − Zone direct allocation (Step1)  Compute the sum of the previous quantities (Labelled afterwards as “Total Key Split”)  For each Zone, compute the bill difference allocated i ir l Zone indirect allocation = EU Bill Difference Unallocated ∗ Zone Key Split Total Key Split Finally E Bill ifference nallocated = EU Bill Difference − EU Bill ifference Allcoated Step 2: Allocation of the unallocated part based on the arginal prices  For each Zone, co pute the axi u possible cons r surplus Zone ax Consu er Surplus = demand ∗ ∆(Zone marginal price)  For each Zone, compute the key to allocate the remaining part of the EU ill difference Zone ey Split Zone ax Consu er Surplus − Zone direct allocation (Step1)  Compute the sum of the previous quantities (Labelled afterwards as “Total Key Split”)  For each Zone, compute the bill difference allocated indirectly Zone indirect allocation E Bill ifference nallocated ∗ Zone ey Split Total Key Split Finally U Bill Diff U ll a e ill iff ill Diff ll : ll i ll rt d on th m i l ic , m m im m i l l M l e i l i  For each , ll i ing rt f ill iff Z ne Ke li = Zone Max Consumer Surplus − Zone direct allocation (Step1) f i i i ( ll f l Split”)  For e h Zon , bill difference allocated i i l Zone indirect allocation = EU Bill Difference Unallocated ∗ Zone Key Split l li Finally  For each Zone, compute the maximum possible consumer surplus Zone Max Consumer Surplus = demand ∗ ∆(Zon marginal price)  For each Zone, compute the key to llocate the remaining part of the EU Bill difference Zone Key Split = Zone Max Consumer Surplus − Zone direct allocation (Step1)  Comput the sum of the previous quantities (Labelled afterwards as “Total Key Split”)  For each Zone, compute the bill difference allocated indirectly Zone indirect allocation = EU Bill Difference Unallocated ∗ Zone Key Split Total Key Split Finally For each Zone, compute th bill differenc Z n bill difference = Zone direct allo ation + Zone indirect allocation Step 2: Allocation of the unallocated part based on the marginal prices \\ For each Zone, compute the maximum possible consumer surplus \\ For each Zone, compute the key to allocate the remaining part of the EU Bill difference \\ Compute the sum of the previous quantities (Labelled afterwards as “Total Key Split”) \\ For each Zone, compute the bill difference allocated indirectly Finally For each Zone, compute the bill difference Page 30 of 31 Detailed process In the following description, the term Page 30 of 31 For each Zone, compute the bill difference For each Zone, co pute the bill difference For each Zone, comput the bill difference

Ten-Year Network Development Plan 2017 Annex F: Methodology | 25