dr. G.J. Zijlstradr. G.J. ZijlstraProgramm manager Platform Programm manager Platform

Energy LiberalizationEnergy Liberalization

Dutch grid administrators: Dutch grid administrators: Administrative cornerstoneAdministrative cornerstone

in the marketin the market

CIRED 2003, Barcelona 15 May

Impact of deregulation on the Electricity distribution business

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Dutch electricity supplyDutch electricity supply

10 grid operators/administrators

7.5 mln. connected customers

TSO: TenneT

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Dutch gas supplyDutch gas supply

12 grid operators/administrators

6.8 mln. connected customers

TSO: GasTransport Services (GTS)

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Liberalization of Electricity and Gas Liberalization of Electricity and Gas marketmarket

1999 2002 2004

Very large customers

> 10 mln. M3

> 2 MW

Large customers

> 1 mln. m3

> 3x80 Amp

Consumers and small business

Electricity 650 60.000

7.5 mln

Green market:

1-7-2001 (1.5 mln.)

Gas 200 2.000 6.8 mln.

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Working committees

Proposals

Working committees

Proposals

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June 2000 start of Platform Energyliberalisation (PVE)June 2000 start of Platform Energyliberalisation (PVE)

Platform

Government (Ministry of Economic Affairs)

TSO electricity (TenneT)

TSO gas (Gasunie)

Associations of Energy companies (EnergieNed and VOEG)

Representative organisations of customers (VNO, MKB, LTO)

Agreement

Platform

Government (Ministry of Economic Affairs)

TSO electricity (TenneT)

TSO gas (Gasunie)

Associations of Energy companies (EnergieNed and VOEG)

Representative organisations of customers (VNO, MKB, LTO)

Agreement

Market forumCustomer organisationsSuppliers organisationsProducers organisationsGrid operators

Consultation

Market forumCustomer organisationsSuppliers organisationsProducers organisationsGrid operators

Consultation

Programm team

Organisation

Programm team

Organisation

Company programm managers

Implementation

Company programm managers

Implementation

A Platform Agreement is a gentleman’s agreement between government, suppliers, grid operators and customers.

Provisions of the agreements are implemented in law making, codes and contracts by the partners

A Platform Agreement is a gentleman’s agreement between government, suppliers, grid operators and customers.

Provisions of the agreements are implemented in law making, codes and contracts by the partners

Operating conditions for making the Operating conditions for making the “rules of the game”“rules of the game” Electricity Law 1998: regulated T.P.A.; Gas Law 2000: negociated

T.P.A.

Little focus with energy companies on market “rules of the game”- Mergers- Separation grid operation from energy company

Changing political priorities from “market solves all problems” to “market generates problems”

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Products of PlatformProducts of Platform Green electricitymarket

- green certificate system- phasing of the market (open 1-7-2001)

- preliminary market procedures (administration)

Retailmarket gas and elektricity

- retail model- supplier switch procedure- customer home moving procedure- profiles and reconciliation systems

- supplier of last resort

Wholesale market gas

- allocation of gas volumes

Free meteringmarket (per 1-8-2002)

- Metering Code Elektricity- Metering Code Gas

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Principals for PlatformPrincipals for Platform

The market operations should be effective, clear and low costs (common standards and automation of procedures)

Supplier is the main player for the customer in the energy market

No barriers to switch

Respecting the difference between monopoly (grid operators) and market (suppliers/metering companies)

The commercial proces should not influence the security of supply

Simular procedures for the gas and elektricity market

The grid operator is the administrative cornerstone

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Roles in the marketRoles in the market

Customer- choses supplier- choses metering company

Customer- choses supplier- choses metering company

Supplier- supplies energySupplier- supplies energy

Metering company- supplies metering services- supplies metering data

Metering company- supplies metering services- supplies metering data

Grid operator- supplies transports- registers- physical security of supply

Grid operator- supplies transports- registers- physical security of supply

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Structure Dutch electricity marketStructure Dutch electricity market

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PR

CUSTOMER

TenneT

RGO RS

I

I

PRc

I

Tc+ Cc

I

Tc

Ec

Tennet = System operator/national gridRGO = regional grid operatorRS = retail supplierP/I = production or importPR = Programma responsible party

I

P/I

Ec + PRc

Ec + PRc

I

National grid

Regional grid

Cc= Connection contract

PRc= PR contract

Tc= transport contract

Ec= energy contract

I= information to determine

energysupplie andunbalancing

Structure Dutch gas marketStructure Dutch gas market

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shipper

CUSTOMER

GTS

RGO RS

Tc

I

Cc+ Tc

I

SA

E (Tc)

GTS = system operator/national grid RGO = regional grid operatorRS = retail supplierP/I = production or import

I

P/I

E

E (Tc)I

National grid

Regional grid

Cc= Connection contract

SA= system agreement

Tc= transport contract

Ec= energy contract

I= information to determine energy

supplie and unbalancing

(Tc) = including national transport costs

I

The grid connection is a crucial The grid connection is a crucial transaction pointtransaction point

Registration Unique connection number Customer Supplier Programm responsible party or shipper Metering company Metering data Transport capacity

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Regional grid administrator has a central registration role:

he “owns” the connection register

Regional grid administrator has a central registration role:

he “owns” the connection register

Supplier model retailmarketSupplier model retailmarketSupplier is the main player for customer in the energymarket

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Metering companyMetering company

CustomerCustomer SupplierSupplierenergy contract

Met

erin

g s

ervi

ces

con

trac

t

Grid operatorGrid operator

Customer contractsCustomer contracts

transport contract

connection contract

Grid operatorGrid operatorInvoice metering services

CustomerCustomer

MeteringcompanyMeteringcompany

Invoices ( supplier model)Invoices ( supplier model)

Invoice energy, transportand metering services

SupplierSupplier

Invo

ice

tran

sp

ort

an

dM

eter

ing

ser

vice

s

Switching of supplierSwitching of supplier1) Customer signs a contract with supplier

2) New supplier informs grid operator

3) Grid operator checks data and registers

4) Grid operator informs old and new supplier, PR/shipper and metering company of the switch

No charge for the customer Easy to initiate by the customer Short leadtime

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Regional grid operator/administrator checks, registers and informs

Regional grid operator/administrator checks, registers and informs

Profiles and reconciliationProfiles and reconciliation

Profiles are necessary for the determination and allocation of supplied volumes

Reconciliation is important as a correction proces on the volumes determined through profiles

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Regional grid operator/administrator calculates the supplied volumes and informs supplier (billing) and system operator (balance control)

Regional grid operator/administrator calculates the supplied volumes and informs supplier (billing) and system operator (balance control)

Supplier of last resort Supplier of last resort

The failure of a supplier to fullfill the programm responsibility or shipper contract triggers the proces

Central role for the system operators Supplier choice for the customer Minimal societal and customer costs

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Regional grid operator/administrator implements the required administrative changes (connection register) and informs the supplier of last resort

Regional grid operator/administrator implements the required administrative changes (connection register) and informs the supplier of last resort

ImplementationImplementation Translating procedures in IT-processes and IT-messages

Implementing and changing IT-processes * New systems for profiles, reconciliation,

and allocation* New system for connectionsregister* Changing systems to implement new procedures

Design and implementation of IT-messages* language: Edine - Edigas* connections and servers* testing

Changing working procedures

Changing organizational structures

Updating datafiles

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Simplified handling of metering data (gas)Simplified handling of metering data (gas)

Shipper

Makes forecast

Receives caloricvolumes

Receives unbalance

Customer

Supplies metervalues

Recieves metervalues,

caloric volume and bill

Retailsupplier

Receives metervalues

Recieves caloric

volumes

Determinesbill

Meteringcompany

Reads meterand transmits

data

GTS

Supplies caloricdata per grid area

Receives caloricvolumes

per shipper

Receivesforecasts

per shipper

Determines unbalance per shipper

Grid operator

Recievesmetervalues

Recievescaloric data

Determines caloric volumes

per shipper/supplier

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Lessons learnedLessons learned Unnecessary differences in regulations for electricity and gas lead

to complex procedures and delay

Unclear lawmaking leads to confusion and delay (meteringmarket and position of supplier)

A convergence of actions at the same time lead to uncertaincy and mistakes (opening energymarket and meteringmarket and adjusting of metering)

A lack of awareness for the central role of procedures in the market leads to a lack of commitment and capacity reservation

The souvereign will of the people is difficult to match with the requirements of procesmanagement

Stick to your principles, stick to your time schedule, communicate and gain commitment

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