energy exchange

Strategic reserve necessary, exchange reacts satisfactorily

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The end of the Greek energy system’s reliance on lignite, being phased out to help the global climate change effort, needs to be accompanied by a strategic reserve mechanism, which would maintain certain generation capacities outside the electricity market for operation during emergency cases until the ongoing transition to cleaner energy sources has been completed, the extreme heatwave conditions around the country over the past few days have highlighted.

Record-level electricity consumption, combined with power line damages caused by major fires, pushed the grid to the limit, raising fears of widespread power outages.

The government, currently seeking the establishment of a strategic reserve mechanism as part of a Capacity Remuneration Mechanism (CRM), needing European Commission approval, will need to highlight the heatwave-related events that have occurred in Greece over the past ten days.

Sidelined lignite-fired power stations needed to be brought back into action to help the grid meet electricity demand. They offered crucial production contributions representing between 14 and 18 percent of the energy mix.

Lignite-generated output also played a key part in the effort to maintain energy sufficiency last winter, in February, during heavy snowfall that damaged power infrastructure.

The energy exchange has performed rationally during the heatwave conditions, proving its ability to respond to the market’s demand and supply. Day-ahead market price levels rose sharply during the heatwave’s peak and are now subsiding.

 

 

Heatwave pushes up wholesale prices to over €100/MWh once again

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The latest rise in temperatures, prompting further heatwave conditions around Greece, is impacting the wholesale electricity market as the average clearing price in the day-ahead market has risen again to levels of over 100 euros per MWh, following days of more subdued levels, according to energy exchange data.

The average clearing price for today is up to 103.8 euros per MWh, up from yesterday’s level of 93.47 euros per MWh and Sunday’s level of 75.34 euros per MWh.

According to the day-ahead market figures, overall electricity generation today is planned to reach 167,437,017 MWh, with lignite-fired power stations covering just 11,172 MWh, natural gas-fired power stations providing 86,541,739 MWh, hydropower facilities generating 11,829 MWh and all other RES units providing 57,894,278 MWh. Electricity imports are planned to reach 16,159,231 MWh.

Today’s electricity demand is expected to peak at 12.30pm, reaching 8,580 MW, according to data provided by IPTO, the power grid operator.

Three of power utility PPC’s lignite-fired power stations, Agios Dimitrios III, Megalopoli IV and Meliti, will be brought into action today, while five of the utility’s natural gas-fired power stations, Aliveri V, Lavrio IV and V, Komotini and Megalopoli V, will also be mobilized, along with gas-fired units operated by the independent players Heron, ENTHES, Elpedison (Thisvi), Protergia and Korinthos Power.

‘DAPEEP should manage PPAs platform, not energy exchange’

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Preparations for the country’s Market Reform Plan, expected to soon be submitted to the European Commission for approval, have prompted a reaction from RES market operator DAPEEP, asserting it should be appointed operator of green-energy power purchase agreements (PPAs) instead of the energy exchange, as has been stipulated in the plan, now undergoing public consultation.

DAPEEP’s objection to the PPA plan, included in the Market Reform Plan, emerged at a meeting staged by RAE, the Regulatory Authority for Energy, uring discussion on the road map for domestic wholesale electricity market revisions.

DAPEEP’s operator’s chief official Yiannis Giarentis protested that the operator has supported the RES sector’s development for years, being at the helm of this market for 20 years, but has now been sidelined as green-energy PPAs, to facilitate bilateral agreements between RES producers and industrial consumers, are about to come into the picture.

RAE will now examine various proposals and views before taking a stance on the matter.

Energy exchange’s gas market trading details forwarded for public consultation

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The Hellenic Energy Exchange has forwarded for public consultation a list of proposals it has submitted to RAE, the Regulatory Authority for Energy, concerning natural gas market details ahead of the prospective energy exchange trading of gas products.

Matters addressed include the procedure to be applied to determine energy exchange  participation rights, charges and commissions for gas product transactions, professional competence requirements as well as product specification rules.

According to one proposal, an annual subscription fee of 7,000 euros will be set for participants.

Also, daily commission fees of 0.005 per MWh for gas products traded in the day-ahead and intraday markets has been proposed.

The energy exchange’s public consultation procedure is planned to end August 31.

Energy exchange gas platform to be presented Monday

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The energy exchange is nearing an expansion through the addition of a new trading platform for natural gas market products, scheduled to be presented by the Hellenic Energy Exchange and gas grid operator DESFA this coming Monday.

Related public consultation, already in progress, is planned to run until the end of August.

Until now, the Greek energy exchange has only facilitated electricity market trade.

The energy exchange, in association with DESFA, has been working on the new gas market platform since last year, the aim being to launch it within 2021.

The exchange’s new gas platform is expected to help establish Greece as a trading hub of geostrategic and geopolitical significance.

Suppliers request revisions to alleviate cash-flow pressure

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Electricity suppliers, facing steep and lasting wholesale electricity cost increases, which have resulted in cash-flow issues, are seeking revisions that could alleviate the pressure, in recommendations submitted to RAE, the Regulatory Authority for Energy.

Rising wholesale electricity costs have created major cash flow problems for non-vertically integrated electricity suppliers as they are being forced to pay increasing amounts for electricity and related guarantees ahead of payments, to them, by consumers.

Consumers have also felt the pinch as suppliers, seeking protection against the rising wholesale prices, have activated wholesale cost-related clauses incorporated into their supply agreements.

Solutions for both sides seem elusive at present as market forecasts do not see any price de-escalation ahead, only further increases.

In one of the recommendations forwarded to RAE, suppliers called for their cash collateral payments made to the Hellenic Energy Exchange, as a form of guarantee, to be replaced by letters of guarantee representing equivalent amounts.

Suppliers have also requested a reexamination of the clearing price and payment formula in the day-ahead and intraday markets.

They also requested extensions for surcharge payments to power grid operator IPTO and the distribution network operator DEDDIE/HEDNO.

 

Energy Exchange Group (EnEx) celebrates its 3-year anniversary

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Founded in June 2018, EnEx is comprised of the Hellenic Energy Exchange S.A. (HEnEx) and the EnEx Clearing House S.A. (EnExClear). Since its designation by the Greek Regulatory Authority for Energy (RAE) as the Nominated Electricity Market Operator (NEMO), HEnEx has evolved in line with the European agenda for a single and integrated European energy market.

As a designated NEMO, HEnEx successfully performed the necessary market transformations for the preparedness and operation of the Greek power market under the new model. All changes were completed in time and by the 1st of November 2020, the Greek power market was integrated with the European Target Model for electricity markets. HEnEx now operates the Day-Ahead Market, the Intraday Market and an energy Derivatives Market.

A very important milestone for HEnEx was the market coupling of the Greek Day-Ahead market to the European markets – over the border between Greece and Italy on December 15th 2020. On May 11th 2021, HEnEx achieved its second market coupling with Bulgaria. These interconnections enable cross-border trading, optimal capacity allocation and congestion management – all of which, facilitate a European Union-wide market in electricity with optimal welfare and resource allocation.

EnExClear plays also an important role in the flawless operation of the spot electricity markets in Greece. It provides clearing, risk management and settlement services for the Day-Ahead Market and the Intraday Market, and is also responsible for the clearing, settlement and shipping of implicit cross border transactions with the coupled markets. Furthermore, EnExClear is also responsible for the risk management and the settlement of positions of the balancing market, which is run by the Greek Transmission System Operator (IPTO).

Both HEnEx and EnExClear are directing their efforts towards the next important steps:

The establishment of a gas trading platform is the next major milestone. In collaboration with the Greek Gas TSO (DESFA), RAE and the Ministry of Environment, EnEx is designing the model for the new gas trading platform which is expected to be operational in fall 2021.

This year, HEnEx will also start operating three Complementary Regional Intraday Auctions (CRIDAs) and foresees its inclusion in the European Cross-Border Intraday (XBID) initiative in Q1 2022. Furthermore, following the connection of the island of Crete to the mainland electricity network, HEnEx is also leading the integration of the island to the existing Day-Ahead and Intraday Markets of mainland Greece.

In this dynamic and evolving energy environment, EnEx is committed to contributing to sustainability and providing high quality, transparent and non-discriminatory services to its markets participants. With confidence, EnEx will continue developing with vision and determination, while learning from its positive experiences, and strengthening the relationship with its partners and stakeholders.

 

RAE scrutinizing greater lignite use, IPTO may need to clarify

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RAE, the Regulatory Authority for Energy, is considering to seek clarification from power grid operator IPTO on a series of electricity market issues, including differing formations adopted for the day-ahead and ISP markets.

A first presentation, last week, of the target model’s new wholesale market, energy exchange market results and the energy mix has shown an increase in the use of lignite-fired power stations, despite their higher cost.

Power utility PPC’s lignite-fired power stations are still deemed necessary for electricity supply security, even when capacity levels are sufficient, to counter instability issues at the grid’s northern section, where interconnections facilitate electricity exports.

The use of lignite-fired power stations, such as Agios Dimitrios, Megalopoli IV and Meliti, despite the higher cost of CO2 emission rights, has significantly increased energy costs for suppliers and industry.

Also, when IPTO issues grid distribution orders to lignite-fired power stations, the grid-contribution programs of other units are consequently canceled out and remunerated by the energy exchange, even for energy amounts not contributed to the grid.

Meanwhile, lignite-fired power stations are remunerated through the balancing market at price levels that usually exceed 100 euros per MWh.

RAE’s intervention is intended to ensure the electricity market’s smooth functioning and efficiency, for the benefit of participants and consumers.

Strict schedule for Crete target model transition plan

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The European Commission has offered preliminary approval, still unofficial, of a Greek proposal concerning a transitional framework for Crete’s electricity grid link with target model markets.

This development will now enable RAE, the Regulatory Authority for Energy, to conduct public consultation for a temporary plan concerning the island’s participation in the target model’s wholesale markets.

RAE is expected to begin the public consultation procedure this week, sources said. It will feature a strict road map for the model’s implementation, from forthcoming steps all the way to legislation.

The plan’s framework will include two alternative methods for the island’s electricity supply transactions through a small-scale interconnection, with the Peloponnese.

The solution to be selected will greatly depend on the results of the public consultation process.

As previously reported by energypress, a transitional framework is necessary as Crete’s electricity needs will only be partially covered, at a level of about 30 percent, through the small-scale interconnection.

The framework will expire once the island’s full-scale grid interconnection, all the way to Athens, begins operating in 2023.

Authorities gearing up for intraday market entry of traders

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Authorities are picking up the pace on moves needed to also enable traders to begin participating in Greece’s intraday electricity market, one of the new wholesale markets emerging with the target model’s recent introduction.

The Greek energy exchange will forward its proposal for necessary market regulation amendments to RAE, the Regulatory Authority for Energy, within the next two months, energypress sources informed.

These revisions will take finalized shape through ongoing discussions between the energy exchange, as operator of the intraday market, power grid operator IPTO, managing international grid interconnections, and RAE.

The authorities are seeking to establish an optimal formula for the intraday market entry of electricity traders.

The talks, until now, have indicated that intraday day interconnection rights will not be required for transboundary trade between intraday markets that have not undergone coupling.

Therefore, traders will be able to participate in the intraday market by utilizing the amount of daily interconnection rights they have secured and not used for transboundary transactions in the day-ahead market.

The addition of traders to the intraday market promises to boost its liquidity, currently low. This will help liberate market players by offering them greater flexibility, limiting the pressure on the balancing market.

DG Comp motives for restart of older PPC probe unclear

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The European Commission has brought back to the fore a Directorate-General for Competition investigation of power utility PPC and power grid operator DEDDIE/HEDNO over market dominance abuse, despite major market changes that have taken place since 2017, when the probe began.

The direction the investigation’s restart remains unknown. Negotiations between Greece and Brussels for new mechanisms being negotiated could be impacted, some pundits suspect.

Also, the government and state-controlled PPC are currently seeking compensation for the power utility’s need to keep lignite-fired power stations and related mines operational for grid sufficiency needs.

No findings of the investigation’s first round have been released. The probe included raids by DG Comp officials, both local and Brussels-based, of the PPC and IPTO headquarters in Athens that lasted several hours, resulting in confiscations of USB flash drives, documents and hard drives.

PPC’s then-administration, in an announcement at the time, informed that the raid concerned a check on the utility’s “supposed” abuse of market dominance in the wholesale market for electrical energy produced from 2010 onwards.

Prior to the investigation, Brussels suspected levels of the wholesale electricity price – known as the System Marginal Price (SMP), at the time – were being manipulated by PPC through its lignite and hydropower facilities.

In 2017, PPC held an 87 percent share of the retail electricity market and 57 percent of overall electricity generation, now down to approximately 67 and 39 percent, respectively.

Four years ago, PPC’s lignite facilities still dominated the corporation’s portfolio and the energy exchange and new target model wholesale markets did not exist.

The current market setting bears little resemblance to back then. Lignite has regressed into an unwanted, loss-incurring energy source that is being phased out by PPC until 2023, while the energy market is undergoing drastic transformation, as was acknowledged by the European Commission Vice-President Margrethe Vestager, also Brussels’ Commissioner for Competition, in an announcement yesterday.

 

PPC extends industrial tariff negotiations until June

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Power utility PPC has extended by three months its negotiating period for new high-voltage industrial tariffs following a request by a number of energy-intensive producers, energypress sources have informed.

The negotiating sides acknowledge pandemic-related problems have prompted the need for additional time, during which  compromise solutions will be sought.

PPC had given industrial enterprises until February 28 to accept a new high-voltage tariff pricing formula. The previous system’s validity expired December 31.

Industrial electricity charges for the first two months of 2021 have been based on the terms of expired agreements.

According to sources, tariff levels are of secondary importance in these negotiations, the prime concern being a new pricing system sought by PPC, which, if implemented, would bring an end to fixed tariffs and volume discounts.

PPC contends that the target model and its accompanying energy exchange markets, such as the balancing market, need to be taken into account for new pricing formulas.

The negotiating sides appear determined to reach agreements that would bolster the competitiveness of industrial producers without obligating the state-controlled power utility to supply high-voltage electricity at below-cost levels.

Transitional hybrid plan for Cretan participation in markets

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RAE, the Regulatory Authority for Energy, has decided on a transitional hybrid model for Crete’s participation in target model energy markets, covering production and consumption, once the island’s small-scale grid interconnection to the Peloponnese is soon launched.

The fundamentals of the transitional model – to be applied until Crete’s full-scale grid interconnection, all the way to Athens, is completed – have been agreed on by the participating market operators. But details still need to be worked out.

Power grid operator IPTO, distribution network operator DEDDIE/HEDNO and the energy exchange are currently shaping the finer details of the transitional plan, expected to be finalized over the next few days.

Under the transitional hybrid solution, Crete – whose grid will continue being managed by DEDDIE/HEDNO until IPTO takes on the responsibility when power utility PPC, DEDDIE/HEDNO’s parent company, has transferred its network ownership on the island to IPTO – will purchase electricity transmitted through the small-scale grid link at target model energy markets.

As for electricity flowing in the opposite direction, production of Cretan units will be represented by IPTO.

The transitional model, when ready, will be forwarded for public consultation. European Commission approval will be needed for the finalized plan. RAE has already briefed Brussels officials on its proposed transitional model.

Finding a solution for Crete has proven to be a challenge as the small-scale grid link to the Peloponnese will not fully cover the island’s energy needs, meaning it will not automatically cease to be a non-interconnected island once the small-scale grid link begins operating. However, a considerable part of Crete’s energy needs, approximately 30 percent, will be served by the small-scale interconnection.

Normally, when grid links for non-interconnected islands are completed, IPTO assumes responsibility of their electricity networks. However, Crete, Greece’s biggest and most populous island, represents a much bigger interconnection project that is being developed over two stages. The project’s second stage, to reach Athens, is anticipated in 2023.

Failure to find a transitional solution would threaten to leave the small-scale link unutilized.

CO2 right prices up 39% in 45 days, adding to wholesale market price ascent

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CO2 emission right prices have hit new records, trading at levels of over 30 euros per ton in recent days for a rise of 39 percent over the past month and a half that has contributed to the wholesale market price ascent.

These elevated CO2 right levels peaked on Tuesday, at 32.02 euros per ton, well over a price of 23.05 euros per ton recorded just weeks ago, at the end of October.

The upward trajectory of CO2 emission right costs is also contributing to even higher prices in Greece’s wholesale electricity market.

Last Wednesday, the day-ahead market’s average price exceeded 80 euros per MWh, rising further to 93 euros per MWh hour yesterday.

If CO2 emission right trading prices persist at levels of more than 30 euros per ton, power utility PPC will activate a related wholesale price clause incorporated into its supply agreements.

Besides the increase in CO2 emission right costs, the Greek day-ahead market has followed the upward trajectory of other European markets, where the combination of higher demand and deteriorating weather conditions is pushing price levels higher.

According to Greek energy exchange data for today’s day-ahead market, the price will average 82.31 euros per MWh, peaking at 114.1 euros per MWh and dropping as low as 44.38 euros per MWh.

 

Industry opposes bilateral contract restrictions

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EVIKEN, the Association of Industrial Energy Consumers, has expressed opposition to an energy exchange proposal, delivered through public consultation, calling for the imposition of restrictions on bilateral contracts reached by suppliers.

In its letter, EVIKEN notes that an upper limit restricting supplier bilateral contracts to 20 percent of total sales, if suppliers hold a retail electricity market share greater than 4 percent, ensures conditions of liquidity in the day-ahead market and prevents a squeeze on prices.

The association, in its letter, proposes that this regulatory measure be abolished in the day-ahead market given the extremely high price levels registered, noting its maintenance over an extended period threatens to create oligopolistic conditions in the market.

Legal action, even at an EU level, could be taken over the matter, crucially important for the industrial sector, EVIKEN indicated.

Minister urges target model readiness for smooth launch

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Energy minister Costis Hatzidakis has urged all target model officials – including RAE, the Regulatory Authority for Energy; power grid operator IPTO; the energy exchange and EnExClear – to have resolved any pending issues so that a smooth launch of the model may be achieved on November 1.

Describing the upcoming date as historic for Greece’s energy sector, the minister was essentially conveying concerns of energy producers, traders and suppliers, not yet fully convinced that all market systems will be in full working order for the imminent launch.

The balancing market, in particular, remains a concern. The energy exchange is overseeing the day-ahead and intraday markets and IPTO will manage the balancing market.

Simulated dry-run testing of these markets, conducted for a period of over two months to test their limits and operating ability ahead of the target model launch, was completed about a fortnight ago.

Greece’s lead-up to the EU target model has been affected by a series of delays. Hatzidakis, the energy minister, is clearly determined to see the target model procedure through, not only because it is an EU commitment but also because of its prospective market and consumer benefits.

The target model will result in market coupling, or harmonization of EU wholesale markets, the intention being to eliminate market distortions and intensify competition.

A final full-scale test of all market systems is scheduled for October 27 while all is anticipated to be ready on October 30 ahead of the November 1 launch.

New market dry-run testing to end this week, target model launch on Nov. 1

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The dry-run testing procedure for market systems ahead of the forthcoming target model launch, scheduled for November 1, will be finalized at the end of this week, RAE, the Regulatory Authority for Energy, the energy exchange and power grid operator IPTO have jointly decided.

Dry-run testing of the day-ahead, intraday and balancing markets began on August 3 to test their limits and operating ability ahead of the target model’s launch, aiming for market coupling, or harmonization of EU wholesale markets.

Market coupling, to increase competition and lower wholesale energy prices, will ultimately lead to energy union, the EU strategy seeking to offer consumers secure, sustainable, competitive and lower-cost energy.

All domestic parties involved, as well as the energy ministry, have ascertained the Greek launch will take place on November 1 following previous delays.

Even during these final days of simulated testing, day-ahead market prices have, at times, continued to display discrepancies with Day-Ahead Schedule price levels.

This has been attributed to the absence, from dry-run testing, of many traders who participate in the Day-Ahead Schedule, meaning the price levels of the two situations are based on different data.

Though balancing market prices have improved considerably as the simulated testing has progressed, following discrepancies, conclusions cannot be made until actual market conditions come into effect.

Meanwhile, public consultation by RAE on a market monitoring mechanism and a market surveillance mechanism for the new markets is due to be completed next Monday.

The market monitoring mechanism will seek, through structural and performance indicators, to evaluate levels of concentration and the market power of each participant, while the market surveillance mechanism will focus on identifying and combating strategies detrimental to competition.

The next step, once the new markets are launched, will be to market couple, initially with the Italian market, by the end of the year, followed by the Bulgarian market, in the first quarter of 2021, Greek energy minister Costis Hatzidakis recently informed.

 

 

Target model ‘dangerous without monitoring mechanism’

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The launch of target model markets without a fully functional market monitoring mechanism from the very first day, if not sooner, threatens to undermine the entire effort, two industry associations, ESAI/HAIPP, the Hellenic Association of Independent Power Producers, and ESEPIE, the Hellenic Association of Electricity Trading & Supply Companies, have reiterated in warnings to RAE, the Regulatory Authority for Energy.

RAE is currently preparing a market monitoring mechanism, with support from a specialized consultant from abroad, for the target model markets, but the project is still a long way off, energypress sources have informed. RAE is believed to have received an initial draft of the monitoring mechanism plan now being processed in detail for a finalized version.

The market monitoring mechanism, needed to ensure healthy electricity market competition, will accumulate data from power grid operator IPTO and the Greek energy exchange to identify possible market manipulation practices.

The target model, aiming to harmonize Greece’s electricity market with wholesale electricity markets in the EU, faces a delay of a few weeks. Authorities identified pending issues in the lead-up to the previous launch date, scheduled for September 17.

Even the smallest of flaws in a market as limited in size and depth as the Greek market can prompt major financial consequences for participants, ESEPIE warned in its letter to RAE.

The implementation of an effective monitoring mechanism can prevent such setbacks and is essential for creating a climate of confidence in the new markets, the association stressed, adding the mechanism should have been applied during dry testing staged in the lead-up to the target model launch.

Extra week for dry-run tests ahead of target model launch

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A dry run procedure offering simulated testing of all market systems and resolving any glitches ahead of the target model launch, scheduled for September 17, has been extended for another week until September 6.

Authorities met last Friday for a latest review of dry-run results. ESAI/HAIPP, the Hellenic Association of Independent Power Producers, in its observations, primarily focused on the balancing market.

The association also objected to integrated programming process revisions proposed by power grid operator IPTO, as well as the timing of these proposals, just days ahead of the official launch of markets.

ESAI/HAIPP is expected to forward its views on the issue, in writing, to the energy ministry, later today or tomorrow. The matter essentially concerns the calculation of reserves to be covered by the system for its security.

The Energy Exchange, to operate the day-ahead, intraday and forward markets, and IPTO, operating the balancing market, are both scheduled – based on a ministerial decision – to deliver an interim report this week for the energy ministry and RAE on the progress and level of readiness of market systems.

These systems have been undergoing continual testing since August 3. The number of dry-run participants has increased in recent days, while price levels are now at far more rational levels, especially in the day-ahead market.

All market participants, approximately 60 in total, have until September 4 to submit required supporting documents to the Energy Exchange in order to receive membership registration certificates by September 11.

 

Safety mechanism to limit energy exchange fluctuations

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Sizeable electricity price discrepancies – compared to day-ahead scheduling market levels – observed by officials in ongoing dry-run testing of Energy Exchange markets ahead of the target model launch scheduled for September 17 and attributed to unrealistic offers made by participants, are expected to narrow as more participants become involved.

Even so, officials supervising the simulated testing of all four Energy Exchange markets – day-ahead, intraday, forward, balancing markets – plan to introduce a safety mechanism enabling participants to make improved follow-up offers if price levels fluctuate beyond upper and lower limits.

Officials at related agencies and the energy ministry are confident the dry run will be completed on time despite being up against a very tight schedule.

The head officials of RAE, the Regulatory Authority for Energy, the energy exchange, and power grid operator IPTO held a summit meeting yesterday with energy minister Costis Hatzidakis and the ministry’s secretary-general, Alexandra Sdoukou, to discuss the progress of the dry run. Other officials meet on a weekly basis to discuss the effort.

To date, any technical issues that have arisen have been resolved. Both the Energy Exchange and IPTO appear ready for the real-life launch. Market systems have been undergoing continual testing since August 3.

However, a shortage in the number of dry-run participants, especially traders, has been observed. This is concerning as current evaluations of the market system performances cannot be considered entirely accurate. All key players – gas-based electricity producers, suppliers, traders, RES producers and aggregators – must be involved in the simulated testing for a dependable picture.

Once the Energy Exchange and IPTO have declared their readiness, RAE will need to offer its approval of the dry run on September 11, a week before the target model’s scheduled September 17 launch.

The aim is for all players to have entered the market systems on September 15 to prepare their orders for the launch two days later.

Crucial week for target model’s dry-run tests of market systems

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Though any glitches that have emerged during ongoing simulated testing of all energy exchange market systems ahead of a target model launch scheduled for September 17 have been quickly resolved, officials remain concerned about the venture’s level of readiness.

The number of participants for the dry run’s virtual transactions, especially traders, has been insufficient, while participants are submitting unrealistic offers, officials have observed.

This has prompted major fluctuations as well as sizable electricity price discrepancies compared to day-ahead scheduling market levels.

Market systems at the Energy Exchange, to operate the day-ahead, intraday and forward markets, and at the power grid operator IPTO, operating the balancing market, have been undergoing continual testing since August 3.

This week will be crucial as an increase in the number of participants is anticipated, while heightened maturity in bidding methods is also expected, all of which should result in safer conclusions.

For the time being, a deferral of the target model’s September 17 launch date is not being considered. All operators must declare complete readiness to RAE by September 11 if this launch date is to be maintained.

Electricity price levels, once the target model is launched, cannot be forecast at present. This could be possible within the next few days.

Officials at the energy ministry, RAE, the Regulatory Authority for Energy, the energy exchange and IPTO, all monitoring the effort, are scheduled to stage their next weekly meeting tomorrow.

Greek wholesale electricity prices topping European levels

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Greek wholesale electricity prices are currently among Europe’s highest, energy exchange data covering the past few days has shown.

On August 11, the System Marginal Price, or wholesale price, in Greece’s day-ahead market reached 52.3 euros per MWh, Europe’s second-highest level following Poland.

On the same day, Germany’s SMP was significantly lower, at 36.3 euros per MWh, the level in Italy was 41.15 euros per MWh, Bulgaria registered 41.17 euros per MWh and Romania 40.82 euros per MWh.

In yesterday’s day-ahead market, Greece’s SMP was 52.3 euros per MWh, once again virtually topping European levels, exceeded only by the Polish price. Elsewhere, Germany registered 35.86 euros per MWh, Italy’s level was 42.96 euros per MWh, Bulgaria registered 39.13 euros per MWh, Romania 38.25 euros per MWh, while Spain and Portugal both registered 39.27 euros per MWh.

Greece’s SMP was once again second-highest, behind Poland, in the day-ahead market for today, registering a level of 42.5 euros per MWh. Germany registered 38.59 euros per MWh, Italy was at 41.34 euros per MWh, the Czech Republic’s level was 39.02 euros per MWh, Bulgaria registered 39.33 euros per MWh, Romania registered 40.14 euros per MWh, while the SMP level in Spain and Portugal was 40.52 euros per MWh.

Energy exchange dry run starts, target model launch nearing

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Simulated testing of all energy exchange market systems, the dry run, began yesterday, as officially scheduled, putting the launch of the target model on the final stretch.

Market systems linked to power grid operator IPTO, the Greek energy exchange, as well as EnexClear, an energy exchange subsidiary tasked with clearing transactions, are now operating under conditions of virtual reality, signaling the beginning of final-stage testing to be completed at the end of this month.

During the dry run, participating producers and buyers will be making simulated offers and purchases, the objective being to identify possible operational faults or insufficiencies for correction ahead of the official launch of the target model, scheduled for September 17.

All four energy exchange markets – the day-ahead, intraday, forward and balancing markets – are being tested. The energy exchange is in charge of the first three while IPTO is operator of the fourth.

Following August 11, EnexClear will take on a more active role for transaction clearances, a procedure to be performed on a weekly basis.

The overall procedure’s schedule was formalized by a ministerial decision signed on July 10.

High-voltage power demand up during lockdown, exchange data shows

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Industrial high-voltage electricity demand during lockdown in Greece registered an unanticipated increase, rising by 12.46 percent in March, 21.86 percent in April, 30.62 percent in May and 19.71 percent in June, all compared to the equivalent month a year earlier, according to figures provided by the energy exchange.

Prior to lockdown, high-voltage electricity demand registered a milder 2.46 percent increase in February compared to the same month a year earlier.

Overall, in the first half of 2020, demand for high-voltage electricity rose by 14.87 percent compared to the equivalent period a year earlier, the energy exchange figures showed.

On the contrary, demand for mid-voltage and low-voltage electricity between February and May fell to lower levels compared to last year, according to the energy exchange data, reflecting inequalities in the impact of the pandemic on various economic sectors.

Mid-voltage electricity demand slumped 18.89, 22.43 and 22.08 percent in April, May and June, respectively, compared to the equivalent months a year earlier.

In the low-voltage category, concerning households, electricity demand fell considerably during the five-month period from February to June, registering drops of 6.08, 10.96, 19.1, 12.77 and 18.45 percent, respectively.

Figures provided by power grid operator showed an overall decrease, for all categories, of 4.3 percent in the first half of 2020 and a high-voltage demand decrease of 9.4 percent.

Natural gas, electricity imports most influential for Greek SMP levels

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Natural gas and electricity imports are playing an increasingly important role in shaping System Marginal Prices, or wholesale prices, while the influence of more traditional energy sources is waning, latest monthly data provided by the Greek energy exchange has shown.

Natural gas’s influence on SMP levels grew between January and May this year, compared to other fuels and electricity imports and exports, the data showed.

Throughout the five-month period, natural gas-fueled power stations consistently ranked first in number of hours used for SMP levels, peaking in May with 491 hours. Electricity imports consistently followed as a the second most influential factor for all five months.

Lignite-fired power stations, previously a key factor for SMP levels, are now limited to a marginal role, their lowest contribution, one hour in an entire month, recorded in April, the January-to-May figures showed.

Greece’s international grid interconnections are playing an increasingly influential role in shaping the country’s SMP as well as covering energy demand, the data showed.

Power grid operator IPTO has increased capacities for electricity imports via Greece’s grid interconnections in the north.

Safety measures vital for target model markets, producers stress

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The introduction of energy exchange spot markets, in September, when they are scheduled to begin operating, without the adoption of safety measures facilitating competition and preventing manipulative methods, primarily by power utility PPC, the market’s dominant player, could lead to undesired results and strengthen the market’s monopolistic character, independent electricity producer representatives have told energypress.

The officials expressed their concerns as a monitoring mechanism being prepared by RAE, the Regulatory Authority for Energy, with consultancy support, may not be fully functional at the time of the target model’s launch.

The monitoring mechanism is considered the basic tool in the effort to ensure healthy competition in electricity markets as it will be used to collect data from power grid operator IPTO and the Greek energy exchange and identify any manipulative practices in the wholesale market.

Interventions needed, according to independent electricity producers, include restricting PPC’s ability to establish two-way agreements; offering support to the new target model market with a supplementary market offering capacity availability; and protecting markets, overall, through powerful, consistent and independent monitoring mechanisms.

 

Energy exchange launch date rescheduled for September 17

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The energy ministry is set to reschedule the energy exchange market’s launch date for September 17, two-and-a-half months beyond the original June 30 date, following commitments made yesterday, during a virtual conference, by the power grid operator IPTO and Hellenic Energy Exchange (HENEX) administrations on the delivery of information systems and time required for trial runs.

The energy ministry is now expected to soon deliver a related ministerial decision, probably next week, setting the new schedule for the target model, or, more specifically, the energy exchange’s spot markets.

The compatibility of platforms and other applications being co-developed by the Greek energy exchange and IPTO for the balancing market is seen as crucial to the success of the new schedule.

As has been previously reported, a delay in the delivery of a balancing market platform to IPTO by General Electric, commissioned this project, has been a key factor behind the inability of officials to meet the original June 30 launch date.

A GE team that was stationed in Athens for this project left the country without notice, citing the possibility of greater pandemic danger ahead, in reaction to the outbreak.

IPTO, now closely coordinating with GE for a specific delivery date following the relaxation of lockdown measures, has promised to gradually deliver required information systems as of this month, prompting Greek authorities to set a new launch date.

According to the new schedule, certain trial runs testing combined energy exchange and IPTO systems will begin on June 22. Simulated testing, or a dry run, of all systems is expected to start on August 3 and last until markets are actually launched on September 17, given no issues arise.

Energy exchange preparing spot market for natural gas

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The Greek energy exchange has started working on the creation of a modern gas trading platform, energpress sources have informed.

A related study taking into account the needs and interests of companies has been completed as part of the preliminary work. A finalized decision on the effort’s schedule is soon expected.

At present, Greece does not possess an organized wholesale market for natural gas. Commercial transactions are mainly based on two-way agreements between producers and suppliers.

The Greek energy exchange, combining its efforts with gas grid operator DESFA, intends to create a spot market offering conditions that will determine natural gas prices through supply and demand amid a transparent environment to be trusted by all parties involved.

Energy exchange officials believe Greece’s geopolitical role will be pivotal in establishing the country as a central natural gas supply route to markets in southeast Europe.

Target model, energy exchange plans shaped by meeting today

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The energy ministry intends to set new launch dates for the target model and energy exchange markets once it has drawn conclusions from a crucial meeting today with representatives of RAE, the Regulatory Authority for Energy, the Greek energy exchange, and power grid operator IPTO.

A previous June 30 target model launch date will definitely be missed as a result of various delays, including a pandemic-related hold up in the delivery of a balancing market platform by General Electric to IPTO.

The revised target model schedule, to be included in a related ministerial decision, will be based on the new feasible launch date for energy exchange markets.

No pending issues remain concerning the operating regulations to apply for the new markets. All rules have been approved.

Certain formula details, including a much-debated formula concerning the percentage of production each producer will be able to secure through contracts, are expected imminently, prior to June 22, when the tenure of RAE’s head official is set to expire.

A GE team that was stationed in Athens for the balancing market platform project left the country without notice, citing the possibility of greater pandemic danger ahead.

IPTO is now closely coordinating with GE for a specific delivery date, following the relaxation of lockdown measures.

Well-informed authorities insist that the energy exchange’s spot markets cannot be launched before mid-September.

 

Monitoring mechanism ‘needed prior to target model markets’

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A monitoring mechanism enabling RAE, the Regulatory Authority for Energy, to protect target model electricity markets from abusive, non-competitive behavior by electricity producers, must be ready before target model markets are launched, the European Commission has stressed in its latest post-bailout report on the Greek economy.

Legislation ratified by the Greek government late in 2019 strengthened RAE’s powers by giving it authority to raid company offices and impose fines for abusive behavior.

The crucial role of the monitoring mechanism has also been pointed out in Greece’s revised National Energy and Climate Plan.

The monitoring mechanism, to collect data from power grid operator IPTO and the Greek stock exchange, will be able to identify wholesale trade irregularities.

The European Commission report projects Greece’s target model will be launched in the third quarter of this year, beyond a June 30 target date. The pandemic has negatively impacted the delivery date of a trading platform by General Electric.

Earlier this week, market officials contended that a launch of spot markets at the Greek energy exchange is not possible until September, rejecting IPTO claims of an earlier target model start within August.