Open electricity market – regulators view

Rolands IrklisLatvian Public Utilities CommissionCommissioner05.11.2013.

Opening of Electricity Market in Latvia

Since year 2007 all consumers are eligible to buy electricity in open retail market

Nord Pool Spot in Latvia

January, 2013. June, 2013. June, 2012.

Electricity market in Latvia, conditions and challenges

Traded amount of energy in Latvia (MWh)

Electricity market in Latvia, conditions and challenges

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•Estonia – Latvia•Russia/Belarus – Baltic market

Electricity market in Latvia, conditions and challenges

High vulnerability of the market – since there is highly concentrated market and generation and low liquidity the pivotal market participants has great impact on prices and ability to influence the market.

Every single buy or sell bid can have significant impact to the spot price.

Easy to analyse – since there is small number of market participants it more easy to follow each behaviour and each case.

This brings following effects:

Challenges during investigations

Case in Latvian zone – 25th of June

Case in Latvian zone – 25th of June

July 3, 2013 PUC sent out information request to NPS market surveillance

July 18, 2013 PUC sent information request to 6 Latvian NPS market participants

PUC received first data set from NPS which were not appropriate to carry analysis

PUC carried out consultation on data received with NPS and requested clarifications

PUC request NPS permission to get data from NPS price zone in Lithuania and Estonia

August 22, 2013 all Latvian market participants has submitted required information

PUC proposed to host meeting of regulators, NPS and ACER representatives in Riga

NPS market surveillance prior to the meeting October 3, 2013 send their preliminary assessment

In October 3, 2013  NPS presented outcomes, parties exchanged views, regulators decided to ask additional information to market participants and exchange it by October 21, 2013

Consultation is still taking place among regulators and PUC and NPS staff

PUC will present their finding in regulators meeting day before next Miniforum, November 7, 2013

Latvia - preliminary conclusions

• Data received form NPS requires manual rearrangement to be used for market participant behavior analysis and it is time consuming activity

• In Latvia price zone 2 market participants placed offers for sales and 5 market participants placed purchase offers, no congestion on EE-LV link

• No breach of REMIT rules by market participants in NPS Latvia price zone for case of June 25, 2013  

• Misunderstanding was related who should report UMM about grid limitation which limited availability of power production capacity. 

Findings are that: • in Latvia wholesale (NPS LR price zone) market we have just few market participants and therefore liquidity is low.  • Every single buy or sell bid has significant impact on the spot price. 

Details of findings will be presented in the Baltic Regulators meeting day before

Mini-forum in Tallinn this November 7, 2013   

Thank You

Rolands IrklisLatvian Public Utilities CommissionCommissioner05.11.2013.