Elia Group SA/NV · EURONEXT:ELI

Elia Group SA/NV — Investor Presentation (September 2015)

45 slides from Elia Group SA/NV's investor presentation, Sep 2, 2015

  1. Slide 1: TF Implementation of Strategic Reserve for Winter 2016-2017

    TF Implementation of Strategic Reserve for Winter 2016-2017 2nd of September 2015

  2. Slide 2: Agenda

    Agenda • Introduction: scope and practical arrangements (10 min) • Short feedback and status 2015-2016 (15 min) • Result consultation volumes and feedback Pöyry study (30+45min) • Implementation SR 2016-2017: (30 min) • Planning • Wrap up of current design • Experience feedback & first overview main

  3. Slide 3: 1. Introduction: scope and practical arrangements

    1. Introduction: scope and practical arrangements

  4. Slide 4: Introduction

    Introduction In anticipation of a potential ministerial decision to constitute strategic reserves for winter 2016-2017, Elia starts preparing – in consultation with the Task Force - the tender procedure that may be organised in the next months, using as a starting point the mechanisms set-up for win

  5. Slide 5: Internal rules & practical arrangements

    Internal rules & practical arrangements President: Emeline Spire Secretary: Liesa Ottevaere - Language: - Supporting material will be prepared in English + the meetings will be primarily held in English as well, however, participants are free to express themselves in the language of their choice (NL

  6. Slide 6: 2. Short feedback and status 2015-2016

    2. Short feedback and status 2015-2016

  7. Slide 7: Strategic Reserve needs for winter 2015-16

    Strategic Reserve needs for winter 2015-16 Power Plants 3.500 MW 700 2.700 Import 2.700 MW 1.500 3.500 In November 2014 the need for strategic reserves was estimated at 3500MW for winter ’15-’16. iSR - Winter 2016-17 - TF n°1 7

  8. Slide 8: Strategic Reserve needs – Winter 2015-16

    Strategic Reserve needs – Winter 2015-16 3.500 Contracted -750 SR 2.750 Power plants returned to -800 MW the market Evolution of -600 peak-load 1350 1.350 Ministerial Remaining Needs decree needs 11/2014 15/01/2015 06/2015 iSR - Winter 2016-17 - TF n°1 8

  9. Slide 9: Tender Results Strategic Reserve 2015-2016

    Tender Results Strategic Reserve 2015-2016 15/01 22/05 30/07 Decision Minister Elia’s report on Communication on Volumes selection award 15/04 26/06 01/11 Deadline Start of CREG’s opinion on operations Submission offers reasonability Today Signature of contracts ongoing in order to start operations

  10. Slide 10: Remaining Strategic Reserve needs

    Remaining Strategic Reserve needs MW 3.500 -750 2.750 -800 -600 1.350 Pending 805 CHPs under offers for SR discussion 130 Deficit in SR 545 Doel 1 430 Needs Ministerial Remaining 11/2014 decree needs 15/01/2015 06/2015 iSR - Winter 2016-17 - TF n°1 10

  11. Slide 11: Conclusions for winter 2015-16

    Conclusions for winter 2015-16 The combination of measures taken by the governement, market actors and Elia: • Life extension for Doel 1 and Doel 2 – 866 MW • Return to the market of more or less 900 MW centralized production and CHPs • Recommendation to secure offered volumes of strategic reserves

  12. Slide 12: 3. Preparation Volumes 2016-2017 - Result consultation volumes - Feedback Pöyry study

    3. Preparation Volumes 2016-2017 - Result consultation volumes - Feedback Pöyry study

  13. Slide 13: Volume calculation 2016/2017

    Volume calculation 2016/2017 Request from market: transparency on the calculation method of the volume Key requirement to improve the buy-in and good understanding of Elia’s adequacy assessments : 3 step approach Step 1: Step 2: Step 3: Consultation Communication Reporting iSR - Winter 2016-17 - TF

  14. Slide 14: Timeline

    Timeline 8/10 TF 2 Communication >15/11 01/06 – 26/06 input & Communication Consultation methodology results & report 2/09 TF 1 15/10-15/11 Communication Calculation results consultation volume SR 2016/2017 iSR - Winter 2016-17 - TF n°1 14

  15. Slide 15: Step 1: Consultation

    WHO? STEP 1: CONSULTATION  CREG, WG Belgian Grid, TF iSR WHAT?  Input, methodology, format results, communication, reporting HOW?  UG: 01/06 presentation – 02/06 email  TF iSR: 03/06 email  CREG: 02/06 phone – 02/06 email Consultation period: 01/06 – 26/06  4 responses: publication to be discu

  16. Slide 16: Results consultation: Methodology & Process

    RESULTS CONSULTATION0N Methodology & Process Add a technical analysis (based on € and market) In case of fundamental analysis: recalculation on the moment of contracting (latest hypotheses) In case of fundamental analysis: put a cap on volume of SR (limit interference with market to a strict minimum

  17. Slide 17: Results consultation: Communication & Reporting

    RESULTS CONSULTATION0N Communication & Reporting Permanent publication of details on generation plants (capacity, date of closure, …) Publish evolution of demand flexibility Publish more information on output (missing MW per hour, how often shortage driven by FR, …) Publish information neighbouring

  18. Slide 18: Improvements calculation SR 2016/2017

    Improvements calculation SR 2016/2017 Implementation of flow based Improved load data (DSR, growth, temperature) Collection data surrounding countries … Presentation 8/10 on input and methodology 18

  19. Slide 19: Overview of Net Off-Take Reduction Potentials in Belgium

    OVERVIEW OF NET OFF-TAKE REDUCTION POTENTIALS IN BELGIUM 02.09.2015

  20. Slide 20: Contents

    CONTENTS  Introduction  Approach  Response rate and participants to survey  Overall results of questionnaire and interpretation OVERVIEW OF NET OFF-TAKE REDUCTION POTENTIALS IN BELGIUM 20 02.09.2015

  21. Slide 21: Market Response Estimation Questionnaire

    MARKET RESPONSE ESTIMATION QUESTIONNAIRE Overall objective of the survey is to better understand how the Belgian market participants would react in extreme situations This survey intends to better understand how the demand side of the whole energy market and all market participants would react to ex

  22. Slide 22: Contents

    CONTENTS  Introduction  Approach  Response rate and participants to survey  Overall results of questionnaire and interpretation OVERVIEW OF NET OFF-TAKE REDUCTION POTENTIALS IN BELGIUM 22 02.09.2015

  23. Slide 23: Survey Approach

    SURVEY APPROACH The market response estimation combines two sources of information – survey of Belgian market players and collection of international estimates for DSR potential Develop Carry out Analyze and questionnaire survey interpret replies  Complement  Development of  Circulate  Collect a

  24. Slide 24: General Information from Survey

    GENERAL INFORMATION FROM SURVEY For the estimation of total net off-take potentials it is distinguished between TSO- and DSO-connected consumption Market response potentials [MW] Information on market response potentials from survey participants Grid Users  TSO-connected part of the net off-take1)

  25. Slide 25: Approach to Calculation – Potentials in the TSO Grid

    APPROACH TO CALCULATION – POTENTIALS IN THE TSO GRID For potentials on a winter weekday peak at TSO level GU information is the leading source of information and is validated and extended by BRP and AGG information Source of information 1 2 (Directly Contract1) (internal) double connected) counting

  26. Slide 26: Contents

    CONTENTS  Introduction  Approach  Response rate and participants to survey  Overall results of questionnaire and interpretation OVERVIEW OF NET OFF-TAKE REDUCTION POTENTIALS IN BELGIUM 27 02.09.2015

  27. Slide 27: Response Rates

    RESPONSE RATES Response rate Grid Users Response rate BRPs Response rate Aggregators No of sites No of respondents No of respondents 17% 33% 39% 61% 67% 83% Replied Not Replied ~75% of the ~85% of total volumes of belgian load* Elia Grid Users* *asynchronous peaks COPYRIGHT©PÖYRY OVERVIEW OF NET OFF

  28. Slide 28: Contents

    CONTENTS  Introduction  Approach  Response rate and participants to survey  Overall results of questionnaire and interpretation OVERVIEW OF NET OFF-TAKE REDUCTION POTENTIALS IN BELGIUM 29 02.09.2015

  29. Slide 29: Contract-Based Net Off-Take Reductions

    CONTRACT-BASED NET OFF-TAKE REDUCTIONS*  BRPs use their contracted amounts to self-optimize their portfolio 174 MW  The amount refers to the questionnaire replies from BRPs, declared as contract- volumes contracted to use for self-optimization based with BRPs  Such contracts are characterized by

  30. Slide 30: Price-Based Net Off-Take Reductions

    PRICE-BASED NET OFF-TAKE REDUCTIONS*  The Grid Users – all connected to the TSO grid – stated in their questionnaire 438 MW replies an actual reaction of 378 MW to Belpex prices, of which 137 MW reacting price-based also to imbalance prices from TSO GU and gen.  A small part of this volume comes f

  31. Slide 31: Voluntary Net Off-Take Reductions

    VOLUNTARY NET OFF-TAKE REDUCTIONS* 150 MW voluntary  150 MW of voluntary market response based on voluntary reactions of DSO-grid reduction connected consumers based on BRP replies to the questionnaire from DSO  This amount was cross-checked with results from international benchmark GU * As the qu

  32. Slide 32: Conclusion

    CONCLUSION 174 MW  The presented MWs are aggregated results coming directly from contract- answers received in the survey (high response rate) after cross-checks based with and logical corrections/ extrapolations in a limited number of cases. BRPs  The flexibility of those MWs is subject to a vari

  33. Slide 33: www.poyry.com

    COPYRIGHT©PÖYRY www.poyry.com

  34. Slide 34: 4. Implementation SR 2016-2017

    4. Implementation SR 2016-2017: • Planning • Wrap up of current design • Experience feedback & first overview main design topics for evolution 2016-2017

  35. Slide 35: Strategic Reserves: Prep. Winter 2016-2017 Overall timeline

    Strategic Reserves: Prep. Winter 2016-2017  Overall timeline Min. Call for Advice CREG SoS Analysis decree candidates 15/01 01/07 1/11 13/11 15/02 1/12 11/12 29/01 15/03 15/04 20/05 2/9 FR to DRAFT FR approval Tender Report Elia Call for CREG PdC Offers tender Consultation PdC Sept-Oct-Nov 4 Wks 2W

  36. Slide 36: Wrap-up design 2015-2016

    Wrap-up design 2015-2016 Market design: - Detection: Economic or Technical Trigger - Notification, Verification, Injection, Stop - Impact on imbalance Prices: SSI - Available information on Elia’s website Product design: SGR - availability : remuneration and penalties - activation : remuneration and

  37. Slide 37: High level market design

    High level market design 1. Detection 2. Notification 3. Verification 4. Injection & Balancing • Economic • Select & • Verify the • SR actually trigger based inform SR for need for SR injects on Belgian warming before going • Impact on curtailment over to balancing in Belpex actual prices • Technica

  38. Slide 38: Structural shortage – Real-time indicator

    Structural shortage – Real-time indicator • Total offtake > total injection (SI≤0) and all units at their max • Reserves (R2 + R3 + interTSO) contracted for residual imbalances and FO Window Where the 4500€ risk is ACTIVE “start of need – stop signal” 16h 22h SI Available Ibids No SSI and/or no “nee

  39. Slide 39: Strategic Generation Reserve (Principles 15-16)

    Strategic Generation Reserve (Principles 15-16) • Who: Power Plants which closure is announced or already effective (art. 7 quinquies ) • Contractual obligations: - SGR service available during the 5 months winter period(s); - reserved capacity remains out-of-market throughout the validity period of

  40. Slide 40: Strategic Demand Reserve (Principles 15-16) (1/2)

    Strategic Demand Reserve (Principles 15-16) (1/2) • Reduction of consumption at the level of a (group of) delivery points: • AP to Elia grid Head meters used for invoicing • AP to DSO grid • Point in a CDS connected to Elia grid Sub-meters (existing or to install ) compliant with specifications • Po

  41. Slide 41: Strategic Demand Reserve (Principles 15-16) (2/2)

    Strategic Demand Reserve (Principles 15-16) (2/2) Activation Characteristics Reaction time (6,5 +) 1,5 hours Duration 4 / 12 hours • Activations are limited: Number 40 / 20 times Max. duration 130 hours Max. duration 60 hours Recuperation 4 / 12 hours • Depending on the nature of the delivery point

  42. Slide 42: Overview of main design topics

    Overview of main design topics Market design: - Detection: Economic or Technical Trigger - Notification, Verification, Injection, Stop - Impact on imbalance Prices: SSI - Available information on Elia’s website New for 2015/2016: Product design: • SGR:  technical limitations of power plants taken i

  43. Slide 43: Evolutions for winter 2016/17

    Evolutions for winter 2016/17 • Consultation • Methodological improvements: SoS analysis: market reaction assessment, flow- based… • Communication Market design: Adaptations of web site in order - Detection: Economic or Technical Trigger to facilitate the follow up of he - Notification, Verification

  44. Slide 44: 5. Stakeholder feedback

    5. Stakeholder feedback: • Synergrid • FEBEG • BDRA • Febeliec

  45. Slide 45: Many thanks for your attention!

    Many thanks for your attention! ELIA SYSTEM OPERATOR Boulevard de l'Empereur 20 1000 Brussels +32 2 546 70 11 info@ elia.be www.elia.be An Elia Group company

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