Technical profile

Long-term transmission rights pursuant to article 30 of EU Commission Regulation 2016/1719, establishing a guideline on forward capacity allocation 110/2017/R/eel

March 06, 2017

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With consultation document  110/2017/R/eel the Italian Regulatory Authority for Electricity, Gas and Water illustrates its guideline on forward capacity allocation with reference to long-term transmission rights, in order to make the national regulation fully compliant with European rules, and in particular with EU Regulation 2016/1719 which came into effect on the 17th October 2016.

In particular, article 30 of the Regulation imposes the obligation for TSOs to issue long-term transmission rights on the borders between bidding zones, i.e. "zone-to-zone" rights, with the aim of offering a hedging instrument against the risk represented by the variability of the price differential between the same zones as a result of the day ahead market (day ahead market coupling).
With reference to the Italian system, the allocation of such rights occurs exclusively on the borders between domestic and foreign zones, while - in consideration of the specific characteristics of our market and in particular the presence of a single national purchase price - it is not envisaged to be carried out with reference to the borders between domestic zones; the document therefore presents:
  • The intention to derogate from the obligation, required of TSOs, to offer zone-to-zone hedging rights on the bidding zones "inside" the Italian market. This is possible as envisaged by the same EU Regulation if, by the 17th April 2017, the Regulator adopts a decision not to offer these rights, following consultation with market operators and the other competent regulatory authorities for the  Capacity Calculation Region (CCR) to which the bidding zone borders belong (in this case it is only RAE, the Greek regulator);
  • The intention to safeguard the national specific characteristics mentioned above by maintaining the issuance, by TERNA, of instruments for hedging the differential between the SNP (single national price) and zonal selling prices (CCC).
The parties concerned are invited to submit their observations to the Regulator by the 3rd of April 2017. 

This sheet is for disclosure purposes only; it is not a regulatory measure.