E07-PC-19: Secondary Markets

ERGEG Public Consultation 2007/05/10 - 2007/07/04

Background

On 10th May 2007 ERGEG launched a public consultation on Secondary Markets – the way to deal with contractual congestion on interconnection points

Secondary markets for capacity rights are an important vehicle for capacity re-trading and thus provide for access to natural gas transmission systems within the borders of the EU.Effective secondary markets can be considered an important congestion management tool.
A study by regulators in the North West gas Regional Energy Market of the Gas Regional Initiative (GRI) shows that there are no liquid secondary markets for transmission capacity at North West European cross-border interconnection points. This is backed up by the findings of the Energy Sector Inquiry of the European Commission (January 2007), which covers the whole EU.
The objective of this ERGEG public consultation paper is to invite the views of stakeholders on: 

  • Whether the findings of the study for the North-West Region of the GRI with regard to the performance of the secondary market could or should reflect the performance of secondary markets in the rest of Europe
  • If yes, whether the recommendations provided in this paper are applicable to the Europe Union.

This ERGEG public consultation paper suggests the following solutions for improving secondary market liquidity:

  • establishment of a platform for the trade in secondary capacity rights which facilitates auctions of secondary capacity rights (e.g. (e.g. pilot project at the Bunde and Ellund interconnection points).
  • stricter application of firm Use It or Loose It (UIOLI) on the primary market for all contracts including legacy contracts.

ERGEG invites all interested parties to comment on issues raised in the text.  Any comments should be received by 4th July 2007 and should be sent by e-mail to: secondarymarkets@ergeg.org

Any question to this document should in the first instance be directed to: 

             Mrs Fay Geitona
             Email: fay.geitona@ceer-eu.org
             Tel. +32 2 788 73 30
             Fax +32 2 788 73 50

Consultation Documents

E07-GFG-22-14a / E07-PC-19-01
Secondary Markets - the way to deal with contractual congestion on interconnection points

E07-GFG-22-14b / E07-PC-19-16
Secondary Markets - the way to deal with contractual congestion on interconnection points, 18 October 2007

Public Responses

E07-PC-19-02
BG International

E07-PC-19-03
Centrica

E07-PC-19-04
Edison

E07-PC-19-05
EFET

E07-PC-19-06
ENI

E07-PC-19-07
Eurogas

E07-PC-19-08
Exxonmobile

E07-PC-19-09
GasTerra

E07-PC-19-10
GEODE

E07-PC-19-11
GTE

E07-PC-19-12
Merrill Lynch Commodities

E07-PC-19-13
RWE Gas Midstream

E07-PC-19-14
Shell Energy Europe

E07-PC-19-15
Statoil