Regional Market MonitoringMini Forum CWE REM

Paul GiesbertzDTe

Brussels, 20 June 2006

2

Legal framework

DTe is responsible to monitor energy markets. This

requirement was included in the Dutch Electricity Act

(article 5) and came into force on July, 14 2004 and follows

Article 23 of the European Directive 2003/54/EU.:

– These regulatory authorities shall … at least be responsible

for … monitoring in particular …. the level of transparency

and competition

3

Market Monitoring in Power Markets is particularly relevant, difficult and important

Electricity is non-storable Each 15 minutes defines a new product! Low demand elasticity European energy markets are concentrated Existence of transmission constraints can cause local market

power problems A large consumer with some load shedding potential can have

significant market power in certain periods European market design is NOT mandatory pools with bids on a

per generation unit basis Multiple markets entail risk of cross-market gaming Effective monitoring can establish threat and reduce risk of abuse

and improve market confidence

4

Regional markets require regional market monitoring

Market participants are international parties that act in

several markets and optimise their portfolio as a whole National markets are closely and increasingly linked Market coupling implies further close interaction between

national markets Further market integration may reduce regulatory threat on

“national champions” The Roadmap FR-BE-NL therefore foresees set-up of joint

monitoring Task Force

5

Pentalateral Energy Forum – Report June 8th

The 5 Ministers invite:– the relevant legislators … to amend … legislation in

order to enable regulatory authorities … to exchange …

confidential information– Regulators to draft a multilateral agreement on

confidentiality that will facilitate the information

exchange between themselves.

6

What is next?

Regional market monitoring is much more than sharing

confidential information But also: joint analysis and joint reporting Market structure and possible power mitigation measures

require regional perspective