230309_MESC minutes draft

Ref: MESC 14-12

Market European Stakeholder Committee (MESC)

Wednesday, 5 July 2023, 10:30-16:00

ENTSO-E premises/ Online

Draft Minutes

Participating Members

Christophe

Gence-Creux

ACER/Chair

Mathilde

Lallemand

Anne

Radermecker

Rickard

Nilsson

Europex

Michele

Stretti

Europex

Annette

Jantzen

Eugine

Marie

Bourrousse

Eurelectric

Donia

Peerhossaini

Eurelectric

Michael

Van Bossuyt

IFIEC

Jerome

Le Page

EFET

Lorenzo

Biglia

EFET

Sonia

Saly

EFET

Valerie

Reif

FSR

Simon

Dupond

SolarpowerEurope

Vidushi

Dembi

WindEurope

NRAs/ NEMOs/ACER/ ENTSO-E representatives

Zeljka

Kössldorfer

E-Control

Sven

Kaiser

E-Control

Lisa

Dallinger

BNetzA

David

Allmann

BNetzA

Maarten

Klijn

ACM

Timon

Dubbeling

ACM

Salauze

Amaury

CRE

Clement

Poet

CRE

Rafael

Gómez-Elvira

All NEMO Committee Chairman

Rodrigo

Escobar Rodríguez

All NEMOs Committee

Viktoria

Sipos

JAO

Cosimo

Campidoglio

MCSC DA NEMO Co-Chair

Andre

Estermann

MCSC TSO Co-Chair

Thomas

Kawam

CREG

Ondrei

Maca

OTE

Pavlos

Natsis

ENTSO-E

Tore

Granli

ENTSO-E

Kjell

Barmsnes

ENTSO-E

Marta

Mendoza-Villamayor

ENTSO-E

Ramona

Grügelsiepe

ENTSO-E

Kristine

Marcina

ENTSO-E

Enzo

Pentasuglia

ENTSO-E

Fabio

Genoese

ENTSO-E

Katharina

Seiter

ENTSO-E

Ulf

Kasper

ENTSO-E

Participating Members

Benjamin

Genêt

ENTSO-E

Dominik

Schlipf

ENTSO-E

Ludivine

Marcenac

ENTSO-E

Julia

Watzlawik

ENTSO-E

Patrick

Luicx

ACER

Mathieu

Fransen

ACER

Christina

Brant

ACER

Marie

Hjorth Slattebrekk

ACER

Martin

Povh

ACER

Martin

Viehhauser

ACER

Ignacio

Muniozguren Garcia

ACER

Ernst

Tremmel

ACER

Marco

Pavesi

ACER

1 Opening

1.1 Welcoming address + Approval of minutes + Draft Agenda (Christophe Gence-Creux, ACER)

The Chair welcomes the participants to the 33

MESC meeting in ENTSO-E premises in Brussels.

Due to several last minutes comments, the minutes of the meeting of 9 March 2023 will be re-distributed shortly including

all the comments, for one week. If no additional comments are received, they will be automatically approved on the 14 July.

1.2 Update on recent developments + forthcoming deliverables (70%, ACER emergency measures report, HCZCAM

and RCC tasks decisions)

The Chair mentioned all the forthcoming ACER deliverables.

1.3 Approval of the new ESC ToRs

The Chair explains that the ToRs shall be slightly amended as already discussed and distributed. No comments are raised, and

the updated ToRs are approved.

2.1 Update from the EC on the EMD reform

Mathilde Lallemand (EC) provides an update on the legislative process of the EMD reform. On the council side, the Swedish

presidency ended without a general approach on the EMD regulation. The Spanish presidency confirmed they will move fast

with it. The main open political topic is the contract for differences, how it would apply to new investments and how the

revenue would be redistributed. On the parliament side, the ITRE vote is expected for 19 July. Trialogues are expected to

start from September.

ENTSO-E, EFET, Europex and all NEMOs present slides during the meeting highlighting the main priorities in the EMD and

their main concerns with the current proposal (see slides ENTSO-E, EFET, Europex).

The stakeholders raised additionally the following concerns during the meeting:

- on the introduction of a single legal entity for market coupling in the EMD (Europex, All NEMOs);

- on the need of a proper impact assessment on the forward market’s proposal – virtual hubs (Eurelectric, EFET,

Europex) in particular Eurelectric argued for a study of the zone to hub risk as well as the allocation of this basis risk

(who will take the risk), and that regulation must provide for the implementation of virtual hubs only if the results of

the cost-benefit analysis are positive;

- on the introduction of the unit-based bidding for all regions on the parliament proposal (Eurelectric, EFET, Europex).

2.2 Update from the EC on the UK-EU arrangements

The European Commission (EC) explains that by 10 July, the EC expects to receive the report from the EU and the UK TSOs

as well as an ACER informal opinion on the set of questions on the implementation and feasibility of the MRLVC, and that

the Specialised Committee on Energy is expected to take place in October.

EFET asked whether there is a discussion between EU and UK authorities regarding the implementation of the EU (and

potentially UK) CBAM. Mathilde will check this.

Ref: MESC 14-12

2.3 Update on the EnC

Lisa-Marie Mohr (Energy Community Secretariat - EnCS) provides an update (see slides) on the current process of

transposition and implementation of the CACM Regulation, on the main conclusions of the Athens Forum (see conclusions)

and main important deadlines (by end of the year Contracting P, the contracting parties need to finalise the transposition not

only of the CACM Regulation but of the entire Electricity Integration Package adopted in the Energy Community in December

2022.

Stakeholders (MC SC Chair) question the feasibility of the timeline, for example on the designation of NEMOs or the

notification in case of monopoly NEMO. Lisa explains that the timelines are based on the legal obligations defined in the

CACM Regulation, are followed up/monitored by the EnCS and that it is correct that recent ones (e.g. NEMO designation 15

June 2023) were not yet met by all Contracting Parties. EFET asks whether there is a possibility that Commission may change

the deadline, considering that the timeline – both for market coupling as such and the CBAM exemption – is very tight.

Mathilde specifies that the deadline is for the CBAM exemption only, and there is no discussion on a deadline extension for

the moment.

The Energy Community will publish in the next days the CBAM readiness tracker. The Energy Community will publish in

the next days the CBAM readiness tracker.

ACER and the EnCS agree that, in line with the Athens Forum conclusion, the upcoming amendment of the definition of

Capacity Calculations Regions (CCRs) in accordance with Article 15 EU CACM should include the definition of EnC CCRs.

2.4 Update on the new DSR rules

The Chair of the Drafting committee presents the slides on the DSR Network code.

The presenters highlight that this is a learning process, that is the first time that that the TSOs and DSOs jointly draft a network

code, and that the timeline is very challenging. They also highlight the important efforts ongoing to involve and communicate

with all stakeholders.

The drafting committee expresses its satisfaction that the draft text will be shared fully before end July with them. The

explanatory document will only be ready from the beginning of next year. The public consultation will start by the end of

September for a period of 6 weeks.

The DSOs mention that the framework guideline by ACER sets a clear scope of what will be there and what not, but that they

are also considering the EMD discussions.

2.5 Update on the prioritisation of projects

The Chair introduces the topic explaining that following the adad-hoc meeting in May, positions seem to be aligned. The

Chair explains that with this exercise, he wants to involve all parties in this prioritisation process and be fully transparent. He

also highlights that legal implementation deadlines have to be established.

Thomas Kawam (CREG) presents the topic (see slides), explains the main comments received and that the discussion on the

alignment on the guidance note is expected for the MESC in October. ACER will have external support on this project.

There is a general discussion on how to deal with uncertainties and fixed deadlines, how to have reasonable deadlines and

avoid any blame if there are justifications for the delay.

ENTSO-E explains that the main concerns from the TSOs is that they are asked to implement unproven and untested processes,

so setting regulatory deadlines is not realistic. Moreover, there are limitations at national level on cost recovery, and resources

coming from the NRAs. This is a broader discussion that needs to take place.

EFET and Eurelectric note that the project does not seem to address their initial request, i.e. managing the existing and

congested pipeline of projects. With this in mind, they still agree on the need to work on realistic deadline setting as a target

for the future. Further discussion needed on scope (beyond CACM), congested pipeline, criteria, urgency and added value on

the selection and prioritisation of the projects. The stakeholders urge ACER to involve them from the beginning.

ACTION: between now and next MESC, a small group will be created that will work together towards next MESC on the

guidance document for prioritisation of projects. ACER will lead the organisation of this group. Please send a mail to Thomas

KawamThomas Kawam if you wish to participate.

2.6 Update on ACER 70% report

Ignacio Muniozguren Garcia (ACER) presents the main results on ACER monitoring work on the 70% (see slides).

The implementation of the Core DA Flow Based has been a key achievement last year. He highlights that there is still room

for improvement. Derogations and action plans are delaying the implementation of the 70%.

Julia Watzlawik (ENTSO-E) presents the slides explaining the ENTSO-E findings on the 70% which are part of the ENTSO-

E Market Report 2023 (chapter 2.8). ENTSO- E report is available on the ENTSO-E website: The ENTSO-E is publishing

the ENTSO-E Market Report 2023 and ENTSO-E Capacity Calculation and Allocation (CC&A) Report 2023 (entsoe.eu).

EFETEFET highlights that the 70% is not a target but a minimum requirement. The goal is to maximise capacity, 70% of

MACZT being the floor. EFE, IFIEC and Europex raise concerns on having 2 reports with contradicting messages from ACER

and ENTSO-E, and remind the Committee about the work performed by market participants in advising how to bridge the

gap between these reports, back in 2021/2022

The Chair explains that ENTSO-E report is focused on the compliance with national target, not on the final target. ENTSO-E

replies that compliance is a national task. ENTSO-E offers ACER to continue the discussion to further align positions and

reports.

ACTION: The Chair agrees that the goal in the next months shall be to be able to deliver a common message from ACER and

ENTSO-E on the minimum 70% requirement. He also explains that he does not see that by 2025 we can arrive to the target

of the minimum 70% requirement.

3.1 Update on SDAC & SIDC (including the 15’ MTU)

Andre Estermann, Cosimo Campidoglio and Ondrej Maca (Market Coupling Steering Committee) present the slides on the

update of the SDAC and SIDC, including the 15 min MTU timing, SIDC roadmaps, operation and IDA products.

Marie Bourrousse (Eurelectric and EFET) presents the slides on the 15 minutes MTU implementation project.

EFET/Eurelectric ask for a public consultation and impact assessment including all the information available before decisions

on changes on any planned process are taken in Q4 2023. Market participants ask to consider as well the impacts on the

balancing timeframe.

The TSOs and NEMOs confirm that they will analyse the options, come back to market participants and ensure proper

information at the next MCCG meeting in October.

Ondrej Maca (OTE) presents the slides representing the MC SC.

Kjell Barmsnes (All TSOs/ENTSO-E Chair) makes a statement from the All TSOs that he asks to be recorded:

All TSOs are working with NEMOs on amending the algorithm methodology introducing co-optimisation requirements. TSOs

confirm that no amendment to the requirements will be made, and no additional inputs will be provided. All TSOs recognise

that the amendment to the algorithm methodology is therefore restricted to its minimum and will not suffice to move to the

implementation phase.

Rafael Gómez-Elvira (NEMO Committee) confirms that the current version of the algorithm methodology received considers

very high-level amendments. They cannot implement co-optimisation with the provided level of detail, as it is not sufficient

for the implementation phase.

EFET and Eurelectric support putting the co-optimisation project on hold. Both ENTSOE and ACER consultations were held

but there is no clarity on the decision and next steps.

The Chair notes the statements and informs that the discussion will continue in bilateral phases with TSOs and if required

NEMOs.

3.2 Second auctions in SDAC – update on the survey

CREG presents the main outcomes of the surveys they had performed on the SDAC second auctions (see slides).

Next steps:

o A 3rd survey is currently organised among NRAs to determine the general position of NRAs with regards

to the auctions + the preferred way forward as the legal framework is currently blurry.

o On the medium term: there is a chance that 2nd auctions will be discarded because of the challenge due to

the implementation of 15min MTU in SDAC

Ref: MESC 14-12

o On the long term: 2nd auctions could be defined in CACM 2.0

3.3 Update on amendment of the CCR definition

Martin Povh (ACER) provides an oral update on the Capacity Calculation regions (CCRs). There are 3 open topics that are

related to the determination of the CCRs:

- Merger of Italy North and Core region: ACER explains that the demonstration of benefits is postponed but will

happen before go-live to allow a common methodology and common IT tools. ACER will send a formal letter

providing by the end of November to request the start of this merger process. Timeline for the go live of the merger

is expected by ACER by mid-2027. TSOs inform that they do not find this timeline feasible.

- Inclusion of the Celtic interconnector (Ireland and France) in the Core CCR – proposal under consultation.

- Clarification of the Energy Community Regions.

EFET asks if any impact assessment will be carried for the Italy North-Core merger to avoid “exporting” Italian constraints

(seasonal capacity reductions) to the whole Core region. ACER mentions that a test of the Italy North/Core merger will be

performed before go-live is decided to see if there are benefits. The allocation constraints methodology will have to be

approved by the local NRAs.

Eurelectric asks whether Swissgrid would be involved in the Italy North/Core merger. ACER recalls that Switzerland cannot

join market coupling, but they hope that Swissgrid can be part of the capacity calculation processes. ACER does not think

that they need a green light from the Commission on capacity calculation (only for allocation/market coupling), but would

welcome reassurance about this.

EFET also asks if there is any plan to integrate Hansa in the Core or Nordic CCRs. ACER responds that for Hansa, nothing

will happen before CACM 2.0 but half of it could go to Core, and another half could go to the Nordic CRR if TSOs will want

it.

ENTSO-E explains that a public consultation on the CCRs will start shortly on the Celtic interconnector to include the

upcoming SEM-FR Bidding Zone Border into Core CCR.

3.4 Update on the BZR process

ENTSO-E explains that there is a new provisional target date for delivering the BZR for Q4 2024. The Nordic region aims to

deliver results by February 2024 (but still unclear whether this closes the review process for the Nordics, or whether this will

have to wait until the Core results are available, a legal assessment is ongoing). Slides available.

Clarity on the CE timeline depends on computational run times which is still not clear yet. We are talking about months.

One stakeholder asks if there will be a presentation to stakeholders during the public consultation expected for autumn 2023.

ENTSO-E confirms it and there will be a workshop too.

4.1 Update on HAR

ENTSO-E presents the slides with the process and timeline of the HAR. Jerome Le Page (Eurelectric and EFET) presents the

slides. Current projections show that LTFBA will lead to less/zero capacities at certain borders. Minimum capacity volumes

at certain borders are the most sensible solution at this late stage in the process. Collateral requirements will also significantly

increase. Bid filtering will be the start of de-optimisation. Finally, the remuneration of LTTRs in case of DA decoupling

cannot be changed according to FCA and an amendment to that effect cannot be introduced via the EU HAR.

ENTSO-E mentions that we are in the implementation phase and cannot avoid LTFBA. They will discuss with market

participants before the approval by ACER of elements on collateral and bid filtering.

5.1 Update on balancing platforms (including balancing energy prices incidents in PICASSO and MARI)

Ulf Sebastian, Dominik Schlipf and Enzo Pentasuglia (ENTSO-E) present the slides. They highlight the economic surplus

provided by each of the balancing platforms and go deeper on the achievements of each of them as well as present the main

updates of each project. One year of operation of the platforms makes the TSOs confident that they will be able to manage

massive accession waves of TSOs in 2024.

Eurelectric asks for visibility on possible mitigation measures with possible changes on PICASSO. It’s better to first analyse

further the curious points than change the design of PICASSO.

AA decision on possible mitigation measures by the TSOs has not been reached yet. TSOs are still processing Market

Participants feedbacks on that incident, and they will come back to them for the next EBSG.

6. AOB: Survey on structural congestions (ACER)

ACER explains that that they are working with external consultant on a study providing more clear legal definitions of

physical/ structural congestions. The results will be provided in a report that will be published in autumn. It is not meant to

lead to an official decision. There will also be a workshop in autumn.

Next meetings dates:

• 18th October (online)

• 7th December (online)