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1st Technical Workshop: Gas Market Design and Natural Gas Transmission Grid Codes


June 19-21, 2017 // Budapest, Hungary

 Organized by:

Sponsored by the U.S. Agency for International Development (USAID)

Organized by the the Energy Regulators Regional Association (ERRA) and

The National Association of Regulatory Utility Commissioners (NARUC)

Framework and Issues:

In the past ten years, the production of and demand for natural gas have increased dramatically around the world. To accommodate the increased demand for natural gas, countries are building and planning for new pipeline infrastructure and considering reforms to their natural gas sectors to promote competition and bolster the security of natural gas supply through regional cooperation and integration.

Regulators, in collaboration with government officials and stakeholders, are instrumental to developing the necessary regulatory framework to promote investment and set in place the regulations and rules of the road for markets to take shape and prosper.

With the funding support of USAID, NARUC and ERRA are launching a project designed around two of the most instrumental features of any country’s gas sector – the Transmission and Distribution Grid Codes. As part of this project, NARUC and ERRA will hold two interactive workshops in 2017 focusing on gas market design and models, the evolution of gas markets, Transmission and Distribution Grid Codes, and the necessary steps to harmonize grid codes to support regional trade and greater security of supply.

The project will also support the development of detailed Transmission and Distribution Grid Code frameworks to help regulators develop codes that are: 1) tailored to their own country-specific features and context; 2) designed to remove market-related obstacles to competition and trade; and 3) structured to support regional integration.



The regional workshop will engage energy regulators to:

  • Strengthen the understanding of gas market design in the European Union and United States and provide case studies outlining the diverse transition steps countries have taken to reshape and reform gas markets toward greater competition and trade.
  • Review a model outline for a Natural Gas Transmission Grid Code that is compliant with Third Energy Package requirements, with specific presentations and examples on capacity booking, allocation process, nominations and denominations, and balancing.
  • Identify steps and measures necessary to shape Transmission Grid Codes so as to remove market-related obstacles and support regional integration.


DAY ONE, June 19, 2017

THEMATIC FOCUS: Gas Market Design and Transitional Steps to Creating a More Secure and Efficient Gas Sector  

08:45      Registration

09:00      Welcoming RemarksIntroduction of workshop participants

  • Mr. Eric Watnik, Deputy Chief of Mission, U.S. Embassy, Hungary
  • Ms. Jamila Amodeo, USAID
  • Mr. Attila Nyikos, Vice-Chairman, ERRA; Vice-President for International Affairs, Hungarian Energy and Public Utility Regulatory Authority, Hungary 

09:30      Gas Market Design in the European Union – The Current Structures, Features, and Developments in Gas Markets across the European Union

  • Presenter:  Mr. Evangelos Penglis, VIS Consultants

This session will outline the current structures, features, and developments in gas markets across the European Union. Mr. Evangelos Penglis will describe the structure and makeup of gas markets in the EU and outline where EU member states stand with respect to implementing the Third Energy Package requirements in the natural gas sector. NARUC’s project adviser will then highlight the transitional steps that are characterizing countries’ gradual implementation of the Third Energy Package.

10:20      Coffee break

10:40      Transitioning to Third Energy Package Compliance—Facilitated Discussion

  • Moderator: Mr. Evangelos Penglis and Dr. Fotis Thomaidis, VIS Consultants and Mr. Paul Sinton Stack
  • Contributors: Workshop Participants 

Please see ANNEX I for full facilitated discussion topics.

Drawing upon the previous presentation on EU gas market design, this session will feature a facilitated discussion among workshop participants on the structure of gas markets in their respective countries and actions regulators are planning to take in order to accommodate and, indeed, facilitate the changes necessary to be in compliance with the Third Energy Package.

Regarding countries that are not EU member states or signatories to the Energy Community Treaty, participants will be asked about the key drivers reshaping gas markets and the expected changes in their regulatory frameworks needed to address these issues.

11:30      Gas Market Design and Developments in Hungary - A Perspective from the Hungarian Energy and Public Utility Regulatory Authority

  • Presenter: Ms. Edit Farkas, Head of Department, Department of Gas Supervision and Price Regulation, Hungarian Energy and Public Utility Regulatory Authority, Hungary  

Ms. Farkas will provide an overview of the Hungarian gas market and recent developments from the perspective of the Hungarian Energy and Public Utility Regulatory Authority.

12:30      Lunch

13:30      United States – Overview of the US Natural Gas Sector and Markets

  • Presenter:  Mr. Andreas Thanos, Massachusetts DPU

From full regulation to gas supply deregulation and the introduction of an open access regime in transmission in the late 1970s, the US gas sector has undergone a significant transformation in the past forty years. Mr. Andreas Thanos will discuss the evolution of the natural gas sector in the US, outlining the key steps and regulations that reshaped both the gas transmission system and the current US gas sector as a whole. Mr. Thanos will also present the lessons learned and challenges that were confronted by US regulators and stakeholders over the course of this transition.  

14:20      Coffee break

14:40      Case Study on Gas Market Transitions - Greece and Italy

  • Presenter: Mr. Evangelos Penglis, Dr. Fotis Thomaidis VIS Consultants

The regulatory frameworks for natural gas in Greece and Italy provide two perfect examples showcasing the different structures, methods, and timelines for implementing the Third Energy Package in the European Union. NARUC’s project adviser will examine the gas market transitions that have taken place in both Italy and Greece and highlight the key takeaways and relevance of those transitions to workshop participants’ respective countries. 

15:40      Gas Market Evolution in Turkey

  • Presenter:  Mr. Koray Kalaycioğlu, Energy Market Regulatory Authority, Energy Expert

Mr. Koray Kalaycioğlu will discuss the regulators’ role in facilitating Turkey’s transition from having a fully regulated gas sector to a more competitive framework with the eventual introduction of the natural gas exchange within EPIAS.

16:30      Roundtable Discussion - Developing a Roadmap for National Gas Market Structure Development

  • Moderator: Mr. Paul Sinton Stack, NARUC
  • Contributors: Workshop Participants 

This session will include a wrap-up of the day’s activities, including key takeaways and recommendations from the day’s session, and a moderated discussion on both the challenges and next steps that workshop participants envision in the natural gas sectors of their respective countries. Workshop participants will be asked to draw parallels and cite differences in the case studies discussed in the day’s presentations.

16:45      Wrap-up and Key Takeaways from the Day 

17:00      Adjourn

19:00   Group Dinner - First Strudel House

DAY TWO, June 20, 2017

THEMATIC FOCUS: Natural Gas Transmission Grid Code Structure and Essentials  

9:00        Natural Gas Transmission Grid Code Structure and Essentials – What are the Key Components for a Successful Transmission Grid Code?

  • Presenter: Dr. Fotis Thomaidis, VIS Consultants

The Transmission Grid Code is one of the most fundamental documents governing the natural gas sector. It outlines the technical and commercial rules governing the transportation of gas through the transmission system and records the rights and responsibilities of the system operator in relation to parties seeking access and use of the system.

In this session, NARUC’s project adviser will describe the basic function of a Transmission Grid Code; the relevant EC directives, regulations, and decisions that set the requirements for EU Grid Codes; key principles for the development of a successful and efficient Grid Code; and a draft Grid Code structure that details the similarities of Grid Codes across EU member states.  

10:00      Gas Transmission Grid Code Development – Case Studies of Serbia

  • Presenter: Ms. Branka Tubin-Mitrović, Senior Natural Gas Expert, AERS

During this session, Ms. Branka Tubin-Mitrović of the Energy Agency of the Republic of Serbia (AERS) will provide a brief overview of the Serbian natural gas gas sector and describe the key factors, including both the primary legislation and market model, which gave shape to the present Transmission Grid Code in Serbia. The presentation will outline the role of the regulator and network operator in drafting the Grid Code, the past and ongoing challenges to make the Grid Code compliant with the Third Energy Package, and future developments envisioned in the Serbian gas sector.

10:50      Coffee break

11:10      Gas Transmission Grid Code Development – Case Study of Georgia

  • Presenter: Mr. Irakli Galdava, Deputy Director of Gas, Georgian National Energy and Water Supply Regulatory Commission (GNERC), Georgia 

Mr. Irakli Galdava will provide a brief overview of the Georgian gas sector, focusing on key physical, legislative, and market design characteristics of the sector that will influence the development of the Georgian Transmission Grid Code. In his presentation, Mr. Galdava will also discuss Georgia’s challenges to make the Grid Code compliant with the Third Energy Package and its timeline and plan for implementation.

11:40      GNERC’s Development of the Metering and Connection Chapters

  • Presenter: Mr. Irakli Galdava, Director of Natural Gas Department, GNERC

In many ways, metering and connection are two of the first chapters that regulators draft, as they are the least affected by market design and model changes. In light of this, Mr. Irakli Galdava will discuss GNERC’s development of the Metering and Connection Chapters of the Transmission Grid Code.

The presentation will outline how metering and connection currently are conducted in Georgia, key considerations for GNERC and Georgian stakeholders in drafting the Metering and Connection Chapters, and the challenges and implementation plan for the two chapters envisioned by GNERC.

12:00   Transmission Grid Code Development Roundtable

  • Moderator: Moderator: Dr. Gábor Szörényi, former Secretary General and Mr. Paul Sinton Stack, NARUC

This session will feature an interactive discussion on the process and stages of Grid Code development, both in EU countries and across the region.

12:15      Lunch

13:15      Capacity Booking in the US and EU Transmission Systems

  • Presenters: Mr. Eric Matheson, Pennsylvania PUC and Dr. Fotis Thomaidis, VIS Consultants

During this session, Mr. Eric Matheson of the Pennsylvania PUC will provide an overview of the capacity booking products in the US and procedures and rules governing the capacity booking process at the transmission system level. Mr. Matheson will discuss the role of marketers and traders in securing capacity, and the importance of a transparent electronic information platforms (e.g., Electronic Bullet Board).

In a follow-on presentation, NARUC’s project advisers will provide a presentation comparing the regulatory framework for capacity booking in the EU to that of the US.

14:20      Coffee break

14:40      Congestion Management in the US Transmission System

Presenter: Mr. Eric Matheson, Pennsylvania PUC

Regulators and transmissions system operators alike play a critical role in determining how bottlenecks and congestion will be managed. As a response to capacity hoarding, many EU countries have a use-it or lose-it policy, and the EU Network Codes envision the introduction of market mechanisms to efficiently alleviate congestion in the network.

Given the importance of congestion management, Mr. Eric Matheson of the Pennsylvania PUC will examine the processes and procedures of congestion management in the US transmissions system, and he will also discuss the relationship between the electricity and gas sectors and how can congestion management at the transmission system level be administered to secure reliability of both gas and electricity supply.

15:25      Nominations and Programming of System Operation

  • Presenter: Dr. Fotis Thomaidis, VIS Consultants

The nomination of gas quantities to flow through the transmission system is crucial for the programming of system operation. NARUC’s project adviser will focus on interconnection points and present the process of gas quantity nomination and matching that is in line with requirements of the EU Network Codes.

16:05      The Allocation Process

  • Presenter: Dr. Fotis Thomaidis, VIS Consultants

Allocation refers to the process of apportioning delivered gas volumes among system users. NARUC’s project adviser will outline the methodology and process used by TSOs in the allocation process across different EU member states.

16:45      Wrap-up and Key Takeaways from the Day 

  • Session Facilitator: Ms. Jamila Amodeo, USAID

The wrap-up session will address the key takeaways from the day’s presentations and discussions.

17:00      Adjourn

DAY THREE, June 21, 2017

THEMATIC FOCUS: Natural Gas Transmission Grid Code, Balancing Models and Implementation, and Harmonization of Codes to Promote Competition and Trade


9:00        U.S. Network Development Planning 

  • Presenter: Mr. Eric Matheson, Pennsylvania PUC

In the US, the transmission system network is mostly built through contracts and not necessarily through long-term integrated resource planning as envisioned in the European Union, although transmissions system operators do employ forecasting models to anticipate interstate pipeline expansion needs. In back-to-back presentations, Mr. Eric Matheson and NARUC’s project adviser will examine natural gas transmission network development planning in the US and EU, respectively. 

9:30        EU Network Development Planning in the US versus the EU

  • Presenter: Mr. Evangelos Penglis, VIS Consultants

In contrast to the U.S., European Union TSOs are generally required to develop ten-year network development plans (TYNDP), which are reviewed, approved, and monitored by regulators. Mr Evangelos Penglis will briefly touch upon the administrative process of TYNDPs and discuss the technical and economic considerations that go into prioritizing investment programs through modeling and net benefit assessments.

10:30      Coffee break

10:50      European Union Balancing Design and Models – Balancing Essentials, Balancing Models in the EU, and Developing a Transitional Plan for Balancing 

  • Presenter: Dr. Fotis Thomaidis, VIS Consultants

The EU Network Code on Balancing provides a high degree of flexibility to regulators and TSOs for implementation.

Fotis Thomaidis will present an overview of the balancing procedure and a comprehensive example of estimating the balancing position of a shipper. Dr. Thomaidis will also discuss the main design elements of the Network Code on Balancing and present the case of how Greece transitioned from a TSO-based balancing regime to the application of interim measures that are in line with EU requirements.

11:50  Balancing Models and Implementation—Facilitated Discussion  

  • Moderator: Mr. Paul Sinton Stack, NARUC
  • Contributors: Workshop Participants

Drawing upon the previous presentation on EU balancing design and models, a facilitated discussion take place among workshop participants on how balancing is structured and implemented their respective countries and the different steps envisioned to transition towards aligning with the Network Code on Balancing. 

12:15      Lunch

13:15      United States - Balancing Design and Models

  • Presenter: Mr. Andreas Thanos, Massachusetts DPU

Mr. Andreas Thanos will outline how commercial and physical balancing are dealt with at the transmission system level in the US. Since balancing is mostly conducted through terms and conditions of balancing agreements, Mr. Thanos will provide examples of the general key terms and conditions are in those agreements and provide a few examples or case studies outlining how balancing works and the imbalance settlement process.

14:10      Coffee break

14:30      Cross-Border Cooperation – TSO-NRA Collaboration on Balancing and the Steps to Harmonize Balancing Regimes

  • Presenter: Dr Fotis Thomaidis, VIS Consultants

For coordination of balancing in the European Union, cross-border cooperation involving TSOs and regulators will have to take place on the following issues:

  • Nominations-renominations
  • Interconnection agreements and provisions for IPs
  • Short Term standardized products
  • Within-day obligations
  • Implementation of a trading platform, gas day and units
  • Trading possibilities within an adjacent market for balancing purposes
  • Interim Measures

15:30      Reviewing Next Steps and Wrap-up

  • Moderator: Ms. Jamila Amodeo, USAID; Ms. Krisztina Kasza, Program Director, ERRA and Mr. Paul Sinton Stack, NARUC
  • Contributors: Workshop Participants 

The moderators will invite regulators to share their key takeaways from the day’s presentations, as well as from the workshop as a whole.

This session will also discuss the next steps for the project and how the sessions can be tailored to fit the needs and circumstances of participating countries.

16:15      Adjourn

Course registration

In case you are interested in participation, please drop an email to the ERRA Secretariat:



Hungarian Energy and Public Utility Regulatory Authority (HEA)
Bajcsy-Zsilinszky út 52., H-1054 Budapest, Hungary