ACER finds still existing contractual congestion in European Gas Networks

29/05/2015

Contractual congestion, a situation where gas capacity demand exceeds the technical capacity, has been detected at about 15% of entry and exit sides at interconnection points (IPs) across the EU. The Agency’s annual congestion report​’s main outcome is reflected in a list specifying at which interconnection points the so-called Firm Day-Ahead Use-It-Or-Lose-It (FDA UIOLI) mechanism will have to be applied as a congestion management procedure (CMP) from July 2016 on, if congestion is still found in next year’s report.
The report analyses transport, Congestion Management Procedures and capacity booking data from ENTSOG’s Transparency Platform (TP) for the period 2014 until 2016, as well as 2014 auction data from the PRISMA capacity booking platform.
 
ACER’s main findings

•    How much congestion? Contractual congestion was identified at 32 IP sides and 4 bundles (i.e. a combination of exit and entry), for 13 of the IP sides for a second time. Congestion was mainly found by the non-offer of firm products with duration of at least one month, but also by the occurrence of auction premia.
 
•  Where? Most contractual congestion was found in the -South/South-East region, followed by the South region. In the North-West region the detected congestion is mitigated by active secondary trading and CMP application resulting in firm day-ahead capacity offers.
 
•    Is there progress? CMPs are increasingly applied at IPs in the European Union. Together with the use of interruptible capacity and secondary capacity trading, contractual congestion was alleviated in some cases.
 
•    What comes next? 24 congested individual IP sides (and 2 bundles) of the 257 IP sides assessed, have not yet implemented the FDA UIOLI and should potentially do so depending on the outcome of next year’s congestion report.
 
ACER’s main recommendations

•    Improve data reliability: Although progress on transparency and data availability on ENTSOG’s TP - as far as relevant for the congestion report - has been made, TSOs and ENTSOG are requested to ensure that all data are fully available on the TP, reliable, checked and consistent (e.g. with PRISMA auction data).
 
Refining congestion definition: ACER requests the Commission to consider clarifying the case of “congestion” when firm monthly capacity is not offered every month, since the current reading of the CMP Guidelines suggests that an IP is not considered congested if at least one single monthly product is offered.