Questions & Answers

Questions and Answers

Questions in the context of the KOMBI consultation

From the point of view of the German TSOs, the costs of the instruments have to be recognized as permanently non influenceable costs (dnbK). The German TSOs will come to this on an own written statement.

In the planned test phase, the German TSOs will offer firm entry capacities, even if BNetzA initially only considers the costs of any instruments as volatile. The costs of the instruments are shared to an agreed key between the TSOs.

There is a common overbooking concept that is the subject of the definition of the KAP+ procedure. The amount of overbooking capacity which will be offered by the TSOs, will be the responsibility of the individual companies.

General Questions & Answers concerning the market area merger

The joint nationwide market area to be established in Germany will presumbly start operations on 1 October 2021. This is the date the German TSO have agreed with the Federal Network Agency (Bundesnetzagentur), the national regulatory authority. The TSOs believe that the planned timing is the most convenient solution for market participants, as it coincides with the start of the gas year and is therefore in alignment with the timescales of all products and processes related to the gas year.

All market participants can continue to actively follow the development of the journey toward the single German market area. To provide information on the current status, the transmission system operators have launched the event series “Market dialog”. The first information event took place in February on the fringes of E-world in Essen, the second in July in Berlin. The next Market dialog event is scheduled for 5 November in Düsseldorf.

Following the amendments to the German Gas Third-Party Access Regulations, the German TSOs have been cooperating closely and intensively, and have set up a joint project. The aim is to merge both the existing market areas and the market area managers GASPOOL and NCG, and to turn the new market area into Europe’s most attractive and liquid gas hub.

The TSOs have to develop an organisational and procedural structure for the new entity that is to act as market area manager. Moreover, decisions will have to be made as to the corporate form the new market area manager is to take. All these processes take place in parallel with normal business operations, for until the launch of the single German market area GASPOOL and NCG have to ensure that they continue to run their businesses in a reliable way.

A number of working groups have been set up in which the TSOs and market area managers are working intensively on a range of topics, including the selection of the necessary IT systems, the aggregation of large amounts of data and the development of a new capacity model, all of which are matters that pose huge organisational and operational challenges.

Yes, the new market area will encompass the networks for both types of gas currently used in Germany. The market area manager will carry out balancing for highcalorific as well as low-calorific gas, both of which market participants will be able to trade and have converted.

The TSOs, who are also currently the shareholders of the existing market area managers, will be the joint shareholders of the single German market area manager.

Market participants will be informed in time about the fees and charges of the market area manager as usual. Until the merger takes effect all fees and charges will continue to be determined separately. The final fees and charges to be applied in the new market area will be determined in the summer of 2021.

The new market area manager will be named Trading Hub Europe, which was announced on 13 September 2019.

The network operators in the two current market areas use different approaches to determine the available transportation capacity to account for the existing operational and topological network conditions in each market area. These different approaches must be harmonised as part of the market area merger process in order to ensure that the maximum amount of transportation capacity can be made available.

The aim is to retain the capacity available today to the extent possible, both in terms of the actual amount of capacity available as well as the type of capacity product offered. Given that the new market area will be significantly larger, the network operators do not currently expect to be able to ensure this without additional investments or without taking other commercial measures. Given the current regulatory and permitting timescales, it is unlikely that significant investments can be carried out within the timeframe available, which is why the network operators are examining in close cooperation with the Federal Network Agency what other commercial measures could be taken to maintain today’s capacity level both quantitatively and qualitatively and how this could be achieved. In this process it must be ensured that additional costs remain as low as possible and a negative regulatory impact on the network operators involved can be ruled out.

Following the merger of the two market areas, only one joint VTP will then be operated. In terms of the trading transactions to be handled here, however, it will be comparable with the current VTP. It is therefore up to the contractual handling of the market participants to ensure that fulfilment of the trading transactions is also guaranteed after the market area merger. This depends – as is already the case today – on various factors, such as the portfolio structure. The price, as also on the old VTP, will be a stock market product and cannot be predicted.