May 2009


European Energy Regulators’ News

Issue: May 2009

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World Forum on Energy Regulation WFER IV Athens,
18- 21 October

- early bird deadline is 31 May
- confirmed speakers include:
Energy Commissioner Andris Piebalgs and many more distinguished speakers

- Regulation through cooperation- the role of the European energy (Madrid, Florence etc.) regulatory fora

"G8+" energy regulators' Round Table
- ERGEG workshop on 10-year gas development plan
- ERGEG workshop on draft GGP on grid connection and access
-  ERGEG/DG TREN workshop on electricity balancing

Region in the Spotlight
- Central West electricity region + its public consultation on intraday trade model

Regulators' activities this month included a series of workshops and their preparations for the so-called “Madrid Forum” and “Florence Forum”. The role of these stakeholder fora in EU policy development are the feature article this month.

Regulators were very active in international regulatory cooperation. A  "G8+" energy regulators' Round Table on 24 May concluded with 8 firm commitments by regulators (see international section). 

As part of the current ERGEG public consultation on the new Community-wide 10-year gas network development plan, the regulators held a workshop which was very useful to clarify some sensitive aspects such as the non-binding nature of the 10-year network development plan, the role of regulators/governments in investment decision making and the fact that the new Agency for the Cooperation of Regulators (ACER) shall monitor its implementation and make recommendations to the TSOs and regulators in the case of inconsistencies between the plan and its implementation.

ERGEG held two workshops on 15 May: one as part of its current public consultation on draft Guidelines of Good Practice on electricity grid connection and access; and the other (joinlty with DG TREN) on electricity balancing.  On the latter, participants were in agreement on a TSO-to-TSO approach (a natural option as transmission system operators have a full overview of the system) and the use of marginal pricing (which sends a clearer market signal to market participants). Many participants also felt that as a general rule there should not be the option to reserve capacity for balancing purposes. This workshop ties in to ERGEG's work in revising the current Guidelines of Good Practice on Electricity Balancing Market Integration (GGP EMBMI).
Regulators and other energy stakeholders also participated in the DG TREN workshop on Trading Transparency (covering electricity and gas) of the same date. For presentations of the regulators’ workshops see the events section of the

Finally, we remind our readers to save 300 Euro, by 31 May, with early bird registration for the World Forum on Energy Regulation (WFER IV, Athens 18-21 October, 2009).

Regulation through co-operation – the role of European energy (Madrid, Florence etc.) regulatory fora

Stakeholder fora have been set up at EU level (and also regional level via the ERGEG Regional Initiatives) to enable stakeholder participation in EU energy policy development.

Who has a seat at the stakeholder fora?
For the past 10 years, the annual (or bi-annual) European Electricity/Gas Regulatory Forum (called Florence Forum in electricity, Madrid Forum in gas) has brought together stakeholders in a spirit of cooperation. These stakeholder fora are chaired by the European Commission and participants include Member State governments, producers, network operators, consumer organisations, traders and regulators.  ERGEG, as formal advisory group to the European Commission on energy market issues, plays a central role in setting the agenda and in the substantive issues being discussed (e.g. ERGEG often reports on progress in the Regional Initiatives, presents the results of a public consultation or the results of monitoring compliance with rules).

The role of the stakeholder fora
The fora create a formal structure for the voluntary cooperation of energy stakeholders by putting together all those trying to influence policy but from very different perspectives. These stakeholder fora provide a useful platform for the European Commission to ‘bounce’ policy ideas off participants, and of course for the key stakeholders to present their positions before the EU policy makers.

Voluntary nature of the fora
While much progress has been made through these fora, cooperation within them remains voluntary in nature. Experience (e.g. in the process for developing guidelines on gas storage, or on inter-TSO cooperation mechanism in electricity) has shown that voluntary cooperation on its own is not sufficient. Thus, the need for the 3rd Package of energy legislation which, when implemented, will set up a new EU energy regulatory framework, firmly grounded in legislation.

Success of the fora
As a result of these fora, organisations and bodies that disagree on pretty fundamental aspects of market structure and reform may find themselves reaching agreement on other issues. For example, at the end of May 2009, the European Commission will present at the Madrid Forum draft comitology guidelines for gas transparency. These guidelines build not only upon the regulators advice but also the specific requests of traders, the industry, consumer groups and others presented at previous Madrid Forum meetings.

Further evidence of the success of the fora is the fact that in addition to the original electricity (Florence) and gas (Madrid) fora, there is also a forum for the Energy Community of South East Europe (Athens), the citizens’ energy forum (London) and the energy efficiency and renewables forum (Bucharest).

What is discussed at the fora?
The topics discussed range from the very technical to the very political.

Madrid (gas) Forum, 28-29 May 2009
A heavy agenda of the 16th Madrid Forum includes, inter alia, the 3rd Package (in particular the process to develop EU-wide Network Codes and the 10-year gas development plan), monitoring results on LNG, monitoring results and proposals for new measures for Capacity Allocation and Congestion Management, gas storage and an update on the Gas Regional Initiative. The European Commission will present (for discussion) new draft comitology guidelines on transparency which (if adopted) would amend Chapter 3 of the Annex of the Gas Regulation (1775/2005) and become legally binding.

Florence (electricity) Forum, 4-5 June 2009
Topics for discussion at the 16th Florence Forum includes, inter alia, the 3rd Package, the Regional Initiatives, security of supply and the 10-year investment plan, Inter-TSO Compensation, the Market Integration Design Project and transparency.

Bucharest Forum (energy efficiency and renewables), 8-9 June 2009
Participants of the Bucharest forum (which replaces the former Amsterdam Forum) will be keen to listen to the plans of Mr. Christopher Jones, the newly appointed DG TREN Director in this area. Topics for discussion include the new energy efficiency action plan, the challenges of reinventing the grid to meet the challenges of 2020 and what is needed to make the European and offshore grid a reality. ERGEG will make presentation on energy efficiency and the impact on the grid of the 2020 targets.

CEER/ERGEG Publications

   Proceedings of Events (see events section of website):
• "G8+" Energy Regulators Statement, Round Table, 24 May 2009
• ERGEG workshop on 10-year gas development plan, 26 April 2009 (E09-PC-37)
• ERGEG Workshop on draft GGP on grid connection and access, 15 May 2009 (E09-PC-38)

Calendar of current and future public consultations

Area Issue Consultation publication date
Gas ERGEG recommendations on the 10-year gas network development plan 25 March - 29 May
  Input to Framework Guidelines on Gas Transparency July 2009
Electricity Draft Guidelines for Good Practice on Electricity Grid Connection and Access 25 March - 2 June
  Input to Framework Guidelines for Energy Efficiency September 2009
  Input to Framework Guidelines on Joint Grid Planning, Infrastructure and Generation Adequacy September 2009
Customer Indicators for Retail Market Monitoring October 2009
Cross Sectoral

Work Programme 2010 consultation

September 2009

Coherence and Convergence issues in the Regional initiatives

November 2009

The standard period for ERGEG public consultation is 8 weeks. For further information (including ERGEG’s newly revised public consultation guidelines) visit the public consultations section of the website.   


See all dates of Regional Initiatives meetings (RCC, IG, SG) on the ERGEG online Calendar.  For example, the next SG meeting of the North-West region is in Paris on 9th June 2009 or the ERRA Summer School on an Introduction to Energy Regulation (13-17 July).  

The World Forum on Energy Regulation is the leading international conference on energy regulation, held only once every three years.  The upcoming World Forum on Energy Regulation IV, from 18-21 October,which is co-hosted by CEER and the Greek Regulatory Authority promises to be a major event. See the programme on Avail of early bird registration  until 31 May 2009 and save €300.

Regional Initiatives Update

The European Energy Regulators' Newsletter presents Quarterly updates of the 7 electricity regions and 3 gas regions. For the months in between these quarterly updates, the activities in one region will be presented in the "Region in the Spotlight" section. For continued information on activities in each region, please consult the Regional Initiatives website and the regions' dedicated subpages.

Region in the Spotlight - Central West electricity region

The Central West Region is currently running a public consultation (until 15 June) on cross-border intraday trade for the region to determine the exact features of the model to be implemented in the region.

The Central West regulators' proposals stem in part from a specific workshop which took place in the Hague on 20th January 2009, which raising many questions related to a regional solution. Currently, different, non-coordinated, explicit cross-border intraday allocation mechanisms are in place, and regulators are concerned that this has a negative and inefficient impact on the market. While some countries conduct explicit allocation by improved pro-rata with allocation and nomination gates, others have explicit allocation on a continuous 'first-come-first-served' basis, which make trading across borders difficult. In the short-term, a regional solution is urgently needed to facilitate intraday trade on all the borders inside the CWE Region, i.e. Belgium-France, Belgium-Netherlands, France-Germany and Germany-Netherlands. In the medium to long-term, a more enduring solution should be developed, in which a flow-based solution will be the basis for the day-ahead and intraday markets.

In an effort to launch a discussion on how to resolve this market barrier, the consultation paper proposes two options: continuous implicit allocation of capacities for the intraday timeframe (continuous implicit model - which is used in Nordic markets) and implicit auctions, with socio-economic welfare maximisation and a clearing, performed at several gates (implicit auction model - which is used in the Iberian market).

International Activities

At the invitation of the Italian Presidency of the G8 summit of energy ministers in Rome, 24-25 May, the energy regulators held a “G8+” regulatory roundtable.

The roundtable concluded with 8 firm commitments (see the "G8+" Energy Regulators Statement) by the regulators to:
1. respond to climate change and integrating new and best available technologies;
2. mitigate energy poverty, supporting vulnerable energy consumers and empowering energy consumers, in line with market mechanisms;
3. bridge the cross-border regulatory gap by developing tools for regulatory consistency
at regional level;
4. facilitate convergence of interconnected regional markets;
5. improve energy market monitoring and transparency;
6. share best regulatory practices
7. achieve professional excellence through training and education
8. cooperate with regulators from developing countries including cooperation aimed at improving capacity building.

The next World Forum on Energy Regulation (WFER IV) was identified as an ideal opportunity to increase regulatory cooperation on these issues. The "G8+" regulators concretely committed to preparing a report, following the World Forum (WFERIV) in mid October, on the promotion of energy efficiency and perhaps other issues that will be presented next year to the G8 Energy Ministers..

Separately CEER also met bi-laterally with the Russian regulator, the Federal Tariff Service (FTS), to identify areas of mutual interests and potential areas of collaboration and also with the Indian regulator.

About the European Energy Regulators' News

Reported content is given for information purposes only and does not legally bind any of the involved parties. Where third-party sources are mentioned, CEER/ERGEG is not responsible for the accuracy of the information. Your feedback on European Energy Regulators’ News is welcome, so as to improve future issues.

European Energy Regulators' News is a free, electronic newsletter and covers the period from the previous issue to the date of publication. It is your gateway to the news from Europe’s energy regulators, press releases, public consultations, advice to the European Commission, news from the Regional Initiatives, and regulation and policy developments at a national level.

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