Provisioning of dispatching resources

On 31 December 2009, the Ancillary Services Market reform came into force. This new reform innovates some aspects relating to the process and means for presenting bids by operators.
The most important new feature, however, is linked to the producer bid dynamic. In the past, operators could present 6 bids throughout the day (a purchase offer and a sales offer for each of the three time-bands into which the day was divided). These would apply both during the programming stage of the Ancillary Services Market and during the real time phase.
Two new features have been included in the new Ancillary Services Market:

  • a bid structure that is differentiated according to time, power steps (up to 3 steps in purchasing and 3 steps in selling with specific offers for switching off and the minimum production plant) and type of service (use of secondary reserve, provisioning and use of other dispatching services);
  • an infra-day balancing market articulated into 5 sessions, in four of which operators can update their offers. Operators thus enjoy greater flexibility in their bid strategies. In particular, the possibility of a better reflection of the cost incurred associated with the service.

Following the new Ancillary Services Market mechanism, during the scheduling phase, which is held on the day prior to that of the actual flow, Terna bought and sold energy respectively for about 7.0 TWh and 14.8 TWh (respectively 12.5 TWh and 14.8 TWh in 2009), corresponding to a net outlay of € 823 million (€ 1,385 million in 2009, down 41%). Volumes bought and sold in relation to the balancing stage in real time came in respectively as 7.0 TWh (in the same period of 2009, equal to 7.8 TWh, -10%) and 8.1 TWh (in 2009 10.5 TWh, -22%), corresponding to a net expense of € 440 million (in 2009, € 429 million, +3%).

provisioning_of_dispatching_resources_gr

After the real-time phase, Terna verifies the proper execution of commercial obligations by the market participants, both in terms of generation and demand. To that end, the measurements at each point of input and withdrawal are taken, with the help of the distribution firms, and the differences from the schedules are calculated. These differences (imbalances) are measured using algorithms established by the regulatory framework. The net charge resulting from the measurement of these imbalances and of the buying and selling transactions executed by Terna on the Ancillary Services Markets are billed on a pro rata basis to each consumer with the uplift fee.

provisioning_of_dispatching_resources_gr

As established in AEEG Decisions 111/06 and 314/06, commencing from January 2007 this fee is determined by Terna during the first month of each quarter, based on the forecast charges and withdrawals for the quarter concerned. This calculation includes the differences between estimate and actual for the previous quarter, as well as the balance deriving from the settlement of the transport capacity usage fee (CCT), the hedges against volatility in the transport capacity usage fee, the transport capacity interconnection fee and the virtual importation service.