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CBI Northern Ireland Annual Energy Forum - CAG vision and goals
 

CBI Northern Ireland Annual Energy Forum - CAG vision and goals

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David Flinn - A&L Goodbody CAG Project ...

David Flinn - A&L Goodbody CAG Project

Optimal operational flows of gas; A single balancing zone is created; A single IT interface for shippers, so that only one set of nominations is required; Planning and investment decisions are taken on an all-island basis either by a single TSO or coordinated among TSOs

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    CBI Northern Ireland Annual Energy Forum - CAG vision and goals CBI Northern Ireland Annual Energy Forum - CAG vision and goals Presentation Transcript

    • CAG Vision and Goals David Flinn A&L Goodbody
    • CAG Vision and Goals
      • CAG Project – Objectives
      • Optimal operational flows of gas;
      • A single balancing zone is created;
      • A single IT interface for shippers, so that only one set of nominations is required;
      • Planning and investment decisions are taken on an all-island basis either by a single TSO or coordinated among TSOs
    • CAG Vision and Goals
      • Aims of CAG
      • Benefits must be shared fairly between the jurisdictions
      • New tariff regime will ensure no-one is worse off as a result of CAG
    • CAG Vision and Goals
      • Benefits of CAG
      • Real benefits are strategic:
      • Competition
      • Investment
      • Security of Supply
      • Interoperability with GB and Europe
      • level playing field
      • Efficient Network planning
    • CAG Vision and Goals
      • Northern Ireland – Present Structure of Industry – Ownership
      • Premier Transmission Limited (a wholly owned subsidiary of NIEH) who own the Scotland to Northern Ireland Pipeline (SNIP) which links Twynholm in Scotland with the Ballylumford power station in Co. Antrim.
      • Belfast Gas Transmission Ltd. (a wholly owned subsidiary of NIEH) who owns the Ballylumford Torytown Pipeline (“BTP”) which runs from Ballylumford power station to the Belfast distribution network. BGTL and PTL will have the same management team but are legally separate companies.
      • BGE (Northern Ireland) who own the North West Pipeline (NWP) which links the Ballylumford Torytown Pipeline (BTP) at Carrickfrgus to the Coolkeeraghk power station in Co. Derry and the South North Pipeline (SNP) which runs from Gormanstown in Co Meath to connect with the North West pipeline at Ballyalbanagh in Co Antrim.
    • CAG Vision and Goals
      • Northern Ireland has two distribution system operators (DSOs):
      • Phoenix Distribution Limited who operate the distribution network in the Greater Belfast and Larne areas.
      • Firmus Energy Distribution Ltd who are licensed for the conveyance of gas within the towns along the route of North West and South North Pipelines.
      • Firmus Energy has exclusivity in these towns.
    • CAG Vision and Goals
      • Options for Single System Operation
      • The Options are:
      • Coordination between multiple TSO/TOs who are responsible for the provision of system operator services in their areas and who coordinate their activities in order to provide certain system operator services on an all-island basis.
      • Multiple TSO/TOs who contract with a Single Service Provider (SSP) for the provision of all-island system operator services.
      • Dual TSOs licensed to provide system operator functions on an all-island basis.
      • A single TSO licensed to provide system operator functions on an all-island basis.
    • CAG Vision and Goals
      • Multiple TSO/TOs with a single service provider (SSP)
      • A licence obligation on the existing TSO/TOs to contract with the same company for system operator services.
      • This model requires contracts between the TSOs and the service provider rather than between TSOs.
      • PTL has a current service provider, BGE, for the operation of the SNIP pipeline.
      • The key difference between this approach and a single TSO approach is that the asset owners remain the licensed TSOs and continue to be legally responsible for performing all operation functions.
      • 5. Regulation of the SSP given that it would not be a licensed entity. The contract between the TSOs and the SSP will ensure that the SSP provides the services specified in the contract and should address any performance issues.
    • CAG Vision and Goals
      • Single TSO
      • Licensing a single TSO for the island to provide those system operation functions which are to be provided on an all-island basis.
      • 2. Single TSO option would require fewer contracts to achieve as sub-contracts between TSOs would not be required.
    • CAG Vision and Goals
      • Dual TSOs
      • Involve assigning a NI TSO to work alongside the RoI TSO as has been done in SEM.
      • Each TSO would be licensed separately in its own jurisdiction. The licences would place an obligation on the dual TSOs to co-ordinate their activities on an all-island basis.
      • Appropriate co-ordinatation mechanisms could be set out in a contractual arrangement between the two TSOs.
      • This option would require:-
      • A decision on who the NI TSO should be.
      • Interface agreements between the Northern Ireland TSOs and the Northern Ireland asset owners would also need to be drafted.
      • 6. A decision on which of the TSOs will be responsible for the operation of the south-north pipeline will be needed.
    • CAG Vision and Goals
      • CAG Network Code Options
      • Multiple Network Codes
      • This option would see all the current codes remaining in place resulting in three
      • transmission codes, one distribution code and a combined transmission and distribution
      • code.
    • CAG Vision and Goals
      • Dual Network Codes
      • This option would involve two network codes – one in the north and one in the south.
      • The current code structure in Northern Ireland would need to be streamlined into one
      • code.
      • Single Network Code (SNC)
      • A single all-island code would be developed to govern the movement of gas on the all
      • island system on a daily basis. This code would replace the existing codes north and
      • south.
      • The final SNC would have to be agreed with all parties and this will require adoption of each section of the code.
      • A unified code would require a set of governance arrangements to co-ordinate decisions between the two Regulators (NIAUR and CER). The SEM committee provides a model for this.
    • CAG Vision and Goals
      • CAG DECISION
      • Final conclusions on the high level design for CAG will be published on 30 January 2009
      • A single TSO for the island
      • Independent TSO
      • a single Transmission Code of Operations with an opt-out for distribution codes
      • A single gas quality standard for the island (based on GB standard)
      • But the project requires legislative change to implement the changes needed
    • CAG Vision and Goals
      • CAG Decision – Tariffs
      • Harmonised transmission tariff methodology for the entire island
      • Final conclusions were published in December 2008
      • RAs favour Entry/Exit regime
      • Provides investment signals for new investment
      • Alignment to Europe
      • Avoids price rises in Northern Ireland
      • Ease of implementation
      • Requires legislative change to implement