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The 2022/1 edition features:
- Exclusive interview with Mr. Garegin Baghramyan, Chairman of Public Services Regulatory Commission, on the occasion of the 25th anniversary of the Armenian regulator
- Updates from 21 member regulators on:
- policy and legislative developments
- regulatory work and decisions
- internal projects
- significant energy news
Energy regulatory cooperation takes various shapes and formats. Sometimes, subject to specific needs, ERRA regulators approach each other more directly than within the framework of the Association and establish bilateral contacts for knowledge exchange. The most recent example is given by the training cooperation between the Hungarian Energy and Public Utility Regulatory Authority (MEKH) and the Azerbaijan Energy Regulatory Agency (AERA). The story describes the cooperation and contains two interviews - with Dr Samir Akhundov, Chairman of the Board of AERA and with Mr. Pál Ságvári, Vice-President of MEKH for International Affairs.
This document provides an analysis for the smart meter questionnaire created by the ERRA Smart Meter Task Force. In total, 22 countries took part in the project and 19 replied to the questionnaire and the results provide some new comparisons on the role of smart meters in different countries’ electricity markets, leading us to identify recommendations and best-practice-examples towards this hot topic.
The questionnaire was targeting the smart meter deployment status together with related strategies & plans in different countries by addressing the following points:
- Overview of the total available number, type and responsible entities for the metering points on the retail customers’ side;
- Cost-benefit Analyses’ results and related data;
- Roll-out plans and strategies;
- Technical requirements and specifications;
- Main drivers and challenges for deployment;
- Services and business models that rely on the chosen roll-out strategy and functionalities of smart meters;
- Additional legislation for the roll-out plan;
- Time-of-use tariff deployments;
- The deployment of smart meters in different sectors than electricity.
The executive summary is provided by the Austrian Energy Agency.
It is a joint work of the ERRA Committees and the Working Group, including: the Electricity Markets and Economic Regulation Committee, the Renewable Energy Committeeand the Customer Protection Working Group.
Data processed by:
- Eng. Khaled Khallaf, Head of Codes and Technical Performance Department, Gas Regulatory Authority (GasReg), Egypt
Executive Summary and Policy Recommendations:
- Gregor Thenius, Austrian Energy Agency
- Karina Knaus, Austrian Energy Agency
The report summarizes the main findings of the survey prepared by the authors. The paper comprises inputs by 17 organisations/countries and is targeting the current status-quo in electricity market deregulation in the individual countries by addressing the following questions:
- Current Market Structures
- Characteristics of Electricity Market
- Unbundling and Concertation
- Prices on Wholesale Market
- Cross-Border Trading
- Balancing and Ancillary Services
The Survey was prepared by: Ms. Valentyna Dyatlovska, Deputy Head of the Strategic Development and International Coordination Department, National Energy and Utilities Regulatory Commission, Ukraine and Mr. Levan Zakareishvili, Leading Specialist of Electricity Department, Georgian National Energy and Water Supply Regulatory Commission, Georgia.
ERRA Renewable Energy Committee survey on the Regulatory Involvement in the Implementation of Different Renewable Technologies.
This report provides the key figures and results of the survey of 2021 and an overview of the regulators’ involvements, their strengths and weaknesses. Furthermore, it analyses not only the existing tasks but also the roles regulatory authorities have or might have in the future regarding innovative technologies and services.
The paper comprises inputs by 22 organisations/countries and is targeting the current situation in individual countries by addressing the following questions:
- the activities of regulators,
- the different tasks, laws, competences and unspecified duties
- strengths and weaknesses
- the financial support systems in place
- introduction of new services/technologies
- regulators’ involvement in new services/technologies
- the role of the market.
The Survey was prepared by: dr. Katalin Véhmann, Hungarian Energy and Public Utility Regulatory Authority, Hungary and Dr. Harald Proidl, Committee Chairman, E-control, Austria.
The second of two benchmarking reports on gas transmission topics by ERRA Natural Gas Markets and Economic Regulation Committee analyses the following:
- Revenue setting methodologies
(RAB, planned investments and investment deferrral, RoR, line pack, OPEX review, efficiency and quality factors)
- Calculation of unit charges
(transmission charges, pricing models, technical parameters & additional charges referred)
The paper comprises inputs by 14 Members and was compiled by the Committee Chairs:
- Mr. Mehmet Kürkcü, EMRA, Turkey – Committee Chair
- Mr. Viesturs Kadikis, PUC, Latvia – Committee Vice-Chair.
The Hungarian Energy and Public Utility Regulatory Authority (MEKH) presents the article which tells the story of preparation for the Interim Coupling Project (ICP), its implementation, surpassed obstacles and market observations based on a comparison of 100 trading days before the go-live of the project and 100 trading days after. The article is concluded with a number of lessons learnt from the process.
The first of two benchmarking reports on gas transmission topics by ERRA Natural Gas Markets and Economic Regulation Committee analyses the following:
- Capacity allocation mechanisms
- Congestion management procedures
- Cooperation Among TSOs
- The role of the regulators
The paper is based on input received from 14 ERRA Member Organisations.
Mr. Mehmet Kürkcü, EMRA, Turkey – Committee Chair
Mr. Viesturs Kadikis, PUC, Latvia – Committee Vice-Chair.
Conclusions and recommendations by Dr. Péter Kaderják, ERRA’s Former Chairman
The ERRA Secretariat launched a survey to assess the current status of members’ engagement in domestic climate action/decarbonization goals’ and targets’ imposition. The survey also served the purposes of verifying members’ interest in the field, in order to be able to further develop future program agendas. This report presents the results and findings stemming from the submitted answers.
In terms of the scope of the survey, the document first inquired about regulators’ mandates towards national climate action plans/goals and then focused on exploring specific regulatory engagements (roles, decisions, achievements, plans) in the area of decarbonization. The latter translated into an analysis of regulatory involvement in particular actions, technologies and solutions: network planning and development; renewable energy sources; mini-grids/energy communities; demand-side management; digitalization; alternative fuels and energy efficiency. Lastly, the survey allowed for sharing organization’s anticipated challenges and/or obstacles hindering decarbonisation, current or future role in carbon pricing schemes and proposals towards the decarbonization agenda within ERRA’s framework.
Authors: Karl Hausker, PhD, and Karen Palmer, PhD
The report looks at the need for new market designs to support the transition to clean energy and examines the way in which potential market designs can support decarbonization.
As part of the NRRI Insights series, authors Karl Hausker, PhD, and Karen Palmer, PhD, explore the role of decarbonization on power markets; specifically, the need for long-term market redesign. Although current market designs have adequately managed system operations and resource adequacy with a conventional generation mix, there is increasing concern that they are inadequate in an environment with substantial renewable generation and demand response. The growing mix of new technologies and the push for decarbonization have created challenges that necessitate a review of prevailing market design approaches.
“Power Market Design for an Era of Rapid Decarbonization” examines three different approaches to wholesale a redesign: energy-only markets, energy and capacity markets and the energy market plus state-level cost-of-service regulation. The paper focuses on detailed analyses of various designs for long-term markets. Considerations addressed in these analyses include resource planning, transmission needs, distributed resources, bid mechanisms and more.
Carl Pechman, NRRI direction notes that, “Electric markets are now faced with three new challenges, incorporation of renewables, electrification, and decarbonization. These challenges alter the fundamentals of the organized markets. It is time to investigate new approaches to wholesale market design. This paper will play an instrumental role in jump-starting that conversation.”
The 2021/2 edition of the ERRA Members' Newsletter features:
- exclusive interview with Dr. Wolfgang Urbantschitsch, Executive Director of E-Control, on the occasion of the 20th anniversary of the Austrian regulator.
- updates from 29 member regulators on:
- policy and legislative developments
- regulatory work and decisions
- internal projects
- significant energy news
The ERRA Customer Protection Working Group issued a Benchmarking Analysis on Available Price Comparison Tools (PCTs) among ERRA Members. These web-based applications enable customers to compare available offers by retail electricity /gas suppliers, as well get clear, comprehensive, and up-to-date information on electricity prices, supply contract duration, invoicing and other services related to electricity/gas supply.
The report is based on answers from 14 member regulators and aimed to detect availability and features of PCTs as prerequisite for efficient electricity and gas retail markets functioning.
The Albanian Energy Regulatory Authority (ERE) approved the balancing rules for electricity sector with Decision Nr. 106, dating back to 02.07.2020. For the period between July 2, 2020 and March 31, 2021 the rules were applied in a ‘dry run’, without any financial impact for market participants.
The article describes the motivations behind establishment of the ABM, approval process and principles that govern it, main challenges along the way and the observed impact on the electricity market and renewables' integration.
This methodological study was prepared to measure barriers to efficient price formation and easy market entry and participation for new and small players in the EU electricity wholesale markets. The study proposes a set of indicators and a methodology that will enable ACER to fulfil more effectively its new monitoring responsibilities set by the Clean Energy Package.
The report describes:
13 barriers to efficient price formation and nine barriers to easy market entry and participation for new entrants and small actors.
More than 70 qualitative and quantitative indicators to measure these barriers.
The methodology to combine these indicators and create two composite indicators:
ACER index on efficient price formation
ACER index on easy market entry for new players and small actors
A pilot study conducted to test the data collection process, as well as the robustness of the composite indicators´ calculation tool.
The study has been conducted with the support of the consultancy DNV.
22 regulators of the ERRA Customer Protection Working Group (CP WG) provided data to map their duties and powers, with emphasis on consumer protection, and to offer a quick glimpse into their retail markets of electricity and natural gas.
Author: dr. Viktor SZILÁGY, Vice-Chairman of the ERRA Customer Protection Working Group, International Expert for Energy, Hungarian Energy and Public Utility Regulatory Authority (HEA), and co-author Ms. Tata PIRASHVILI, Chief Specialist of the Consumers’ Complaints Department, Georgian National Energy and Water Supply Regulatory Commission (GNERC).
Dubai's multiple urban centres are ideal for high efficiency district cooling systems.
It has long been thought that the sector is in need of regulation to ensure that it is exploited to its full economic potential, and that customers of district cooling systems are adequately protected.
In March 2021, Dubai’s Executive Council issued a resolution introducing regulation to the District Cooling sector in the Emirate. The Regulatory and Supervisory Bureau will regulate Service Providers – those that own and operate District Cooling Systems.
by Mr. Csaba MLINKÓ, Head of Department, National Dispatch Service, MAVIR Ltd.
ERRA would like to express gratitude to the Hungarian Independent Transmission Operator Company Ltd. (MAVIR) and Mr. Csaba Mlinkó for their contribution on this educational video.
See the video presentation on February 2021 Texas Power Outages – Key Findings and Regulatory Lessons by Mr. Elliott Nethercutt, Principal Researcher, National Regulatory Research Institute (NRRI), USA during the ERRA Chairmen Meeting on May 19, 2021.
Topic discussion during the ERRA Chairmen Meeting on May 19, 2021.
- Introduction to the topic by Ardian Berisha, ERRA Regulatory Specialist
- Power Purchase Agreements for differences transitioning towards liberalised markets by Andreas Gunst, Partner, DLA Piper
- Case Study of Turkey by Mustafa Gözen, Senior Energy Specialist, Former Head of the Market Monitoring & Legislation Group, EMRA Turkey
- Nordic PPA: Effects on renewable growth and implications for electricity markets by Samuel Ciszuk, Founding Partner, ELS Analysis
The Webinar was held on May 11, 2021 and approached the topic from regulatory perspectives of LNG infrastructure access and tariffs. In order to look into the practical dimension of LNG supply, the webinar also explored case study examples from specific LNG facilities presented by representatives of the terminals and/or regulators (Turkey, Croatia, Lithuania, Thailand, Egypt).
- Introduction to ERRA
- Introduction of the Moderator
- EU LNG policy considerations in the context of the new Gas Directive
- Regulatory Aspects of LNG Terminals
- Terminals’ regulation for the transition
- Case Study 1: Turkish LNG
- Case Study 2: Croatia – Allowing LNG to boost liquidity
- Case Study 3: Lithuania – FSRU Terminal
- Case Study 4: Thailand – PTT LNG
- Case Study 5: Egypt
- Panel Discussion
The objective of this primer is to assist energy regulators working in emerging economies with building their understanding and knowledge of key concepts related to depreciation, and to support effective decision making when developing cost-reflective tariffs.
This primer presents key factors affecting allowed depreciation costs as well as alternative approaches and regulatory considerations when determining allowed depreciation in the context of cost-reflective tariffs for regulated entities operating in monopolistic market segments (e.g. network companies).
Background: With funding support from USAID, the NARUC is developing a Cost-Reflective Tariff Toolkit aimed at supporting policymakers, regulators, and utilities on the design and implementation of cost-reflective tariffs through effective engagement of the public and key stakeholders in the decision-making process. The Toolkit consists of several short primers providing practical information and guidance on specific elements and topics of cost-reflective tariffs to utility service regulators in emerging economies.
The paper is based on input received from 21 ERRA Member Organisations from the Natural Gas Markets and Economic Regulation Committee.
Authors: Mr. Mehmet Kürkcü, EMRA, Turkey – Committee Chair and Mr. Viesturs Kadikis, PUC, Lativa – Committee Vice-Chair.
Authors: Rahmatallah Poudineh, Anupama Sen, Bassam Fattouh
As much of the world pushes ahead with the deployment of renewable energy, resource-rich MENA economies are lagging behind. For the region to catch up, new policies are required to remove barriers of entry to the industry and create investment incentives. This paper contends that while the main obstacles to deployment of renewables are grid infrastructure inadequacy, insufficient institutional capacity, and risks and uncertainties, the investment incentives lie on a policy instrument spectrum with two polar solutions:
- the incentive is provided entirely through the market (removing all forms of fossilfuel subsidies and internalising the cost of externalities); or
- the incentive is provided through a full government subsidy programme (in addition to the existing fossil fuel subsidies).
However, there is a trade-off between the two dimensions of the fiscal burden and political acceptance across the policy instrument spectrum, which implies that the two polar solutions themselves are not easily and fully implementable in these countries. Therefore, we propose a combinatorial approach in which the incentive for renewables deployment is provided through a partial renewable subsidy program and partial fossil fuel price reform in a way that balances the fiscal pressure on the government against political acceptability. Additionally, the paper argues that the fact resource-rich countries are behind advanced economies in electricity sector reform gives them a last-mover advantage in the sense that they can tap into years of international experience to avoid design mistakes and create a sustainable solution that is compatible with renewables deployment and their own context.
Recording of the ERRA webinar (February 10, 2021) dedicated to gathering and drawing conclusions from impacts observed after 1 year by TSOs and DSOs and also consultants, researchers and regulators. Topics discussed:
- Data analysis of COVID-19 energy market impacts
- The impact of COVID-19 on global power markets
- Assessing the impact of COVID-19 on energy market forward price curves, and effect on investor behaviour in the medium term
- Impact on distribution systems
- COVID-19 reversing progress on energy access in Africa
- Impact on LNG markets
- COVID-19 impact on the energy sector and prospects for impact on energy transition
This paper comprises two parts. In the first section the implemented reforms and achievements as well as existing challenges of Georgian energy sector are discussed from modern and historical perspective. Paper is focused on one of the key acute issues such as energy balance, level of electrification and gasification, utilization of energy resources, energy efficiency, environment and regulation of sector.
The second section envisages the essential issues and activities necessary for the development of Georgian energy sector, in particular, energy security, optimization of energy balance, establishment of competitive energy market, energy saving, environment protection and external cooperation. Justified opinions and proposals needed for the improvement of energy sector regulation are also envisaged by this paper.
The main contents and results of the survey:
- Background and role of NRAs.
- The contents and results of the survey.
- The share of RES in total electricity production:
- The individual targets
- Supporting Systems for RER
- Additional measures
- Duties and activities
- Challenges and barriers
- Most important technologies and services
The paper is based on input received from 28 members organisations!
Authors: Mr. Harald Proidl, E-Control, Austria – Committee Chair and Mr. Mustafa Celebi, EMRA, Turkey – Committee Vice-Chair.
ERRA's internal survey on e-mobility elaborates on the following topics:
- legal/regulatory framework for e-mobility;
- current status and plans regarding deployment of electric vehicles and the related infrastructure;
- electricity system effects of e-mobility;
- role of the NRA regarding e-mobility.
The key findings of the issue include the analysis of the feedback provided by 15 ERRA Members coupled with conclusions and policy recommendations.
ERRA would like to deeply thank dr. Gábor SZÖRÉNYI, former ERRA Chairman and former ERRA General Secretary, who led the drafting efforts to complete the report.
See the presentation by Mr. Nick Haralambopoulos – the Director of Economic Consulting Associates (ECA) – who lead the drafting team dedicated for developing the Study on Regulatory Approaches to Revenue Setting for Electricity Transmission and Distribution System Operators among ERRA Member Organizations. In his delivery, Mr. Haralambopoulos describes key findings of the report and provides insights on how the analysis was conducted.
The TSO/DSO revenue study provides a comprehensive overview of the cost and revenue determination of regulated electricity transmission and distribution system operators, and their subsequent adjustments, among a sample of 20 ERRA Member Organizations (MOs). The analysis is complemented with insights on regulatory governance regimes in place and overall frameworks for tariff setting applied by MOs for the regulated entities. The report is based on a detailed questionnaire through which the authors extracted the targeted information and data from the MOs. In the main part of the study, the authors provide a benchmarking analysis in order to present the findings in graphs and tables and point out the solutions that are applied for a given regulatory issue together with specific indicators/ models and the values defining them in particular regulatory context. This is further coupled with general regulatory insights on applied methods with necessary theoretical descriptions, pointing out examples of best practices among the sampled MOs. The report is concluded with an identification of general tendencies in the development of regulatory frameworks among MOs as well as possible areas of improvement.
Core chapter breakdown is as follows:
- Regulatory governance
- Overall tariff framework
- Cost and revenue determination
- Other revenue determinants
- Revenue adjustments
The Study was prepared in collaboration with ECA - Economic Consulting Associates.
In the podcast Zsuzsanna Pató, Senior Research Associate, Regulatory Assistance Project (RAP) looks at the New Energy Policy Package for 2030. Headlines of the podcasts are: more market, more regionalisation, more demand side resources and more active customers.
Over the past few years, states across the country have seen increased consumer adoption of electric vehicles (i.e., vehicles with an electric motor, or EVs), thereby increasing electricity demand from the transportation sec-tor. This change is quickly becoming a trend, which provides utilities with an opportunity to increase electricity sales while providing customers with the possibility of lowering emissions and overall vehicle ownership costs compared to traditional internal combustion engine (ICE) vehicles. Electric utilities are at different stages of ex-ploring their role in both building EV charging infrastructure and managing grid impacts, including through rate design and managed charging. As a result, many Public Utility Commissions (PUCs), the state agencies tasked with regulating utilities, are being asked to make decisions in this unfamiliar industry, sometimes without direct legislative guidance.
This issue brief provides data about the trends in EV adoption, a synopsis of the types of decisions Commissions are facing, and examples of recent State regulatory approaches to EV questions.