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TAR NC Implementation Document – Second Edition September 2017
BINDING RESERVE PRICES
Responsibility: update of the reserve prices within the tariff period is subject to
NRA decision
Default date for annual yearly capacity auctions
As of 2018, the Amended CAM NC sets the default date of the annual yearly capacity
auction as the first Monday of July, and not the first Monday of March
1)
. Rescheduling
from March to July should provide more time to gather the accurate information
needed for calculations required for publication.
ENTSOG believes that the timing of 30 days before the annual yearly auctions strikes
an appropriate balance between:
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Allowing network users enough time to plan their booking strategies;
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Providing enough time to enable tariff calculations that are as accurate as
possible, and that can consider forecast contracted capacity in conjunction
with estimates of under-/over-recovery from previous years.
Detrimental effect on revenue and cash flow
The TAR NC requires tariff calculations to set binding tariffs for IPs, and for non-IPs
where the CAM NC applies, prior to the annual yearly capacity auctions. Compared
to the current scenarios, transmission tariffs for IPs will be calculated a few months
in advance. Accelerating the calculation of tariffs will reduce their accuracy, exposing
the TSO to greater uncertainty regarding revenue recovery. In the recitals, the
TAR NC expresses the desire to minimise TSO exposure:
‘In order to promote stabil-
ity of transmission tariffs for network users, to foster financial stability and to avoid
detrimental effects on the revenue and cash flow positions of transmission system
operators, principles for revenue reconciliation should be set out.’
The sentence
covers TSOs functioning under all types of regulatory regimes, including price cap
and non-price cap regimes.
Binding reserve prices ‘for the subsequent gas year’ for
floating payable price approach
Under the floating payable price approach, the TAR NC foresees that the reserve
prices published in June for the annual yearly capacity auctions in July must be
binding for ‘the subsequent gas year’, meaning the gas year beginning in October of
the same calendar year as when the auction takes place. Further to stakeholder
feedback, ENTSOG notes that for the cases where the tariff period does not coincide
with the gas year, this TAR NC rule may result in binding reserve prices further than
the end of this gas year, i. e. until the end of the second tariff period starting within
such a gas year.
1) See Article 11(4) of the Amended CAM NC.
ARTICLE 12(3)