FAQs on transaction reporting – Question III.4.2.23

According to Art. 21 Paragraph 3 Commission Regulation (EU) 2017/459 (CAM NC), the European Gas TSOs are obliged to offer a capacity conversion mechanism for their network users to enable them to convert unbundled capacities in bundled capacities. Some TSOs have already started to offer such service as an early implementation approved by their NRAs.
ENTSOG has prepared a model describing the minimum functions of the capacity conversion service (see attached document CAP0717-17 ENTSOG’s Capacity conversion model, 24 July 2017) and especially in its annex 2 the possible conversion scenarios.

However, the model leaves some discretion how to implement the conversion of the transportation contracts legally, especially how the national civil law arrangements/GT&Cs are structured to complete the conversion in a legal manner. Therefore, we as European TSOs like to propose a way, how to properly report these contractual changes under REMIT, taking into account the different possible conversion scenarios and the different national legal implementations.


Answer:

Generally, there are two basic approaches regarding the reporting of a fully converted contract, depending on national implementation:

A) The original contract with unbundled capacity is modified and a new contract is reported.

The capacity amount of the old unbundled contract is reduced to zero and this reduction is reported within the REMIT reporting as a change of the existing contract.

In addition, a new (bundled) contract is reported. This bundled contract contains the whole amount of the capacity. (Please note that reporting data with the approach described in this option does not necessarily imply that a new contract has been concluded under national law.)

OR

B) The original contract with unbundled capacity is modified.

The full conversion is done without reporting a new contract. Such a conversion of capacity is reported as a modification of the existing contract of the unbundled capacity. In this case, the following information should be updated (note that some fields are filled with the existing information):

All relevant information covering the allocation process (TRUM table 4, Data Field No 2-13) as well as information on the lifecycle reporting (TRUM table 4, Data Field No 14), on the premium price (TRUM table 4, Data Field No 21), on the specifications of bundling, and on the counter TSO (TRUM table 4, Data Field No 26).

Regarding the conversion of only part of the unbundled capacity into bundled capacity the following applies:

  • The original contract is modified by reducing the capacity amount by the part of the capacity that is converted into bundled capacity (updating the information in TRUM table 4, Data Field No 15).

AND

  • The part of the capacity that is converted into bundled capacity is reported as a new contract for bundled capacity.

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FAQs on transaction reporting – Question III.4.2.20

In response to Q4.2.19 in the FAQ on REMIT transaction reporting it states that “transportation capacity which allows market participants to flow the gas from a non-balancing area to a balancing area is not a reportable contract. “  Does this mean that secondary transportation capacity transactions are only reportable where the capacity allows flow between balancing zones?  As transportation contracts in REMIT involve two or more locations or bidding zones I had believed that they were reportable regardless of whether the locations are bidding or balancing zones. However, this appears to be contradicted by the answer to Q4.2.19.

We have entry capacity to flow gas into a national transmission system from an LNG terminal.  If we transfer this capacity to another party, is this a reportable transaction?


Answer:

An LNG regasification terminal is not a balancing zone in itself. In the Agency view, the transportation contract from the regasification terminal to the gas terminal does not need to be reported. There are currently no requirements for the reporting of transportation contracts involving locations that are not balancing zones.

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FAQs on transaction reporting – Question III.4.2.21

Market Participant (MP) “A” owns a pipeline business in the UK that transports gas from Point “X” (Exit point of the National Grid´s National Transmission System – certified TSO) or Point “Y” (Entry terminal) to four customers (two oil refineries and two Combined Cycle Gas Turbines).

Qualification of reporting obligations for transportation contracts concluded as a result of primary capacity allocation by or on behalf of the TSO:

MP “A” is not a TSO under Art. 2(11) REMIT and hence, is not obliged to report the transportation contracts with its customers as transportation contracts concluded as a result of a primary explicit capacity allocation by or on behalf of the TSO in sense of Article 6(2) in conjunction with Article 3(1)(b)(i) REMIT Implementing Regulation. This conclusion is based on the following points:

  • Article 2(11) REMIT refers to the TSO definition laid down by Article 2(4) Directive 2009/73/EC and Directive 2009/72/EC.
  • According to Article 10 of the above Directives, each TSO shall be designated and certified as a TSO by the National Regulatory Authority (NRA). MP “A” is not certified as a TSO by the respective NRA (Ofgem).
  • The gas pipeline, owned and operated by MP “A”, has a named license exemption from requiring a TSO certification under the UK Gas Act 1986. Not being certified as a TSO, MP “A” remains out of the scope of the obligations posed on the TSOs. The latter includes the reporting obligations pursuant to Article 6(2) in conjunction with Article 3(1)(b)(i) REMIT Implementing Regulation which stipulate that TSOs or third parties acting on their behalf shall report contracts relating to transportation of natural gas in the Union concluded as a result of a primary explicit capacity allocation by or on behalf of the TSO.

Qualification of reporting obligations for transportation contracts concluded between market participants on secondary market:

The gas transportation contracts that MP “A” has with its customers do not meet the criteria of a secondary capacity allocation foreseen under Article 3(1)(b)(ii) REMIT Implementing Regulation read in conjunction with the reporting format of Table 4 and TRUM pp. 133-155. This assessment is based on the following points:

  • REMIT or REMIT Implementing Regulation do not define what means secondary market for the purposes of Article 3(1)(b)(ii) REMIT Implementing Regulation.
  • A definition of the above term can be found in Article 2(6) Regulation 715/2009 which defines secondary market as “the market of the capacity traded otherwise than on the primary market”. Primary market is defined in point (22) of the same Article as “the market of the capacity traded directly by the TSO”. REMIT or REMIT Implementing Regulation do not make a reference to the above mentioned definitions of primary and secondary market contained in Regulation 715/2009 and these definitions do not therefore directly apply for the purposes of REMIT.
  • Table 4 and the respective passages in the TRUM (pp. 133-155) are designed on the presumption that the contracts concluded between market participants on secondary markets in sense of Article 3(1)(b)(ii) REMIT Implementing Regulation are contracts that govern a secondary allocation of a capacity which was previously and primarily allocated by a TSO, e.g. price paid to a TSO [for the primary capacity allocation] is a mandatory field when reporting secondary capacity allocation.

Questions:

1)    Primary Capacity Market: Are the transportation contracts in question between MP “A” and its four customers reportable under REMIT regulation as transportation contracts concluded as a result of primary explicit capacity allocation by or on behalf of the TSO? Who should be identified as the TSO since MP “A” is NOT a designated and certified TSO in sense of Article 2(11) REMIT?

2)    Secondary Capacity Market:

a. Considering no primary capacity allocation through a TSO has occurred, are these transportation contracts reportable under REMIT regulation as transportation contracts concluded between market participants on secondary markets?

b. How should MP “A” and its customers report fields #25 TSO 1 identification, TSO 2 identification and #34 Price paid to TSO (underlying price) in Table 4, which in the case of the contracts in question are neither applicable nor available?

Business Case:

Market Participant (MP) “A” owns a pipeline business in the UK that transports gas from Point “X” (Exit point of the National Grid´s National Transmission System – certified TSO) or Point “Y” (Entry terminal) to four customers (two oil refineries and two Combined Cycle Gas Turbines).

MP “A” is not considered a TSO and the gas transportation obligations (subject of the contract) are not issued out of primary capacity market (i.e. not traded with a TSO).

Secondly, the nature of the contracts do not satisfy the requirements to report the contracts as secondary capacity since there is no TSO involved, hence a number of key attributes cannot be reported.

Our interpretation is that the above described gas transportation contracts fall outside of the scope of REMIT trade reporting since these contracts are not concluded on a primary market (between TSO and Market Participant), neither do they qualify under the definition of a secondary capacity allocation.

We would be grateful for ACER’s immediate response on this matter please.


Answer:

There are currently no requirements for the reporting of transportation contracts involving locations that are not balancing zones.

If the transportation contracts between MP “A” and its four customers allow to flow gas from points X to Y which are in a non-balancing zone, the transportation contracts are not reportable. The same will apply if the transportation contracts between MP “A” and its four customers would allow to flow gas from points X (balancing area) to Y (non-balancing area). This is in line with FAQ 4.2.19.

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FAQs on transaction reporting – Question III.4.2.22

The question is about how to handle gas capacity contract transaction reporting to ARIS when a Market Participants on shipper side (contract holders) either exit the market (on voluntary basis or e.g. because they run bankrupt) or change their company structure affecting the contract holders name (e.g. split of a company transferring the capacity to the legal successor of the former contract holder) or if a company simply change their names (but the contract holder in fact is the same, no new legal entity). The question does only refer to possible cases in the future and does not affect already reported cases under back loading.

General rule: In general we propose to report these cases depending on what is from a legal point of view happening between the Market Participants (TSO and shipper). In the following cases applying this general rule would mean:

a) Market exit of market participant (=shipper, = contract holder), no matter whether on voluntary basis or because of insolvency/bankruptcy;

b) Legal succession cases (e.g. change in company structure).

Two cases to be distinguished:

  • A new company is established. When the former contract holder is still ‘alive’ he transfers the capacity contract to the new company on secondary market.
  • A new company is established, but there is no special handling between the old and the new company regarding the contract via secondary market but simply all the legal rights and obligations are shifted from the old company to the new one (either by a special contract or – depending on the national civil law – simply by law).

c) Simple change of a name of a company, no new legal entity is established.


Answer:

With regard to point a), the answer depends on:

a) If the contract is Suspended, then there is no need to report anything; or

b) if the contract is cancelled, it should be reported as any other cancellation of a contract.

The cancellation of the contract that has been already reported to the Agency,  through the Gas Transportation Contracts / Edig@s REMIT GasCapacityAllocations_Document schema should be submitted by setting the XML fields as follows:

  • Appropriate report file naming (according to the mandatory naming convention);
  • CREATIONDATETIME – should be set according to the date and time of the creation of the new report file;
  • PROCESS_TRANSACTION.ACTION_STATUS.CODE attribute = 63G (Cancelled, the report is no longer valid);
  • TIMEINTERVAL – delivery end (field 11. End date and time) shall reflect when the termination of the contract takes effect.

Following the cancellation of the contract, the capacity can:

a) be re-allocated to the market and this should be reported as any other allocation; or

b) not allocated to the market and there is no need report it.

With regard to point b):

1. This case should be reported as any other secondary market transaction (reporting obligation lies with the market participants = shippers transferring the capacity contract amongst them).

The TSO should not report any transaction modification through Gas Transportation Contracts through Edig@s REMIT Gas Capacity Allocation schema.

2. The modification of a contract that has been already reported to the Agency, through the Gas Transportation Contracts / Edig@s REMIT GasCapacityAllocations_Document schema should be submitted by setting the XML fields as follows:

  • Appropriate report file naming (according to the mandatory naming convention);
  • CREATIONDATETIME – should be set according to the date and time of the creation of the new report file;
  • PROCESS_TRANSACTION.ACTION_STATUS.CODE attribute = 66G (Changed, the report is valid after having been updated);
  • PRIMARY_MARKETPARTICIPANT.IDENTIFICATION – CODINGSCHEME attribute content modified and filled with the EIC of the “New company;
  • TIMEINTERVAL – delivery start (10.Start date and time) shall reflect when the first delivery of the contract takes place.

The new company has to register with the National Regulatory Authority as a Market Participant.

With regard to point c):

Since the name of the PRIMARY_MARKETPARTICIPANT.IDENTIFICATION is never reported to the Agency through the Gas Transportation Contracts / Edig@s REMIT GasCapacityAllocations_Document, the TSO should not undertake any actions for reports modification. In the reports submitted by the gas TSOs (or on their behalf), the PRIMARY_MARKETPARTICIPANT.IDENTIFICATION is done though the EIC of the Market Participant.

It is the Market Participant’s obligation to properly modify its CEREMP profile and inform the relevant NRA and the Agency about the change in its name. In addition the MP should inform the LIO that maintains its EIC code.A) If the contract is cancelled, it should be reported as any other cancellation of a contract.

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FAQs on transaction reporting – Question III.4.2.19

Does the definition of Secondary Gas Transportation also included zero priced entry assisted capacity that is often bundled with the purchase of beach gas, and therefore is reportable under REMIT?

A certain transaction for us is the purchase or sale of physical gas at a Beach location with other Market Participants. As part of that contract is the inclusion of free (i.e. zero priced) entry assisted transportation capacity which allows us or the Market Participant to flow the gas from the Beach location into the UK National Transmission System (NTS).

Is the embedded transportation in such contracts reportable under Table 4?

We deem such transactions not to be reportable under Table 4 as the purpose of the underlying transaction is not to trade capacity. In addition, the capacity part of the deal cannot be separated and traded in isolation in these deals.

Could ACER confirm this view is correct?


Answer:

According to REMIT, transportation contracts should involve two or more locations or bidding zones concluded as a result of a primary explicit capacity allocation by or on behalf of the TSO.

It is the Agency’s view that entry assisted transportation capacity which allows market participants to flow the gas from a non-balancing area to a balancing area is not a reportable contract.

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FAQs on transaction reporting – Question III.4.2.12

Contractual changes of the original capacity contract in case of application of CMP measures (e.g. ‘successful surrender’; ‘successful reallocation of capacity in case of withdraw’ (=LT UIOLI); ‘secondary sale’)

The TSOs shall submit the contractual changes of the original contract acc. to Art. 7 Para 5 Implementing Regulation (EU) No 1348/2014.

Example: Shipper A holds a capacity contract of 100 amount of capacity. Shipper A sells 40 to Shipper B on the secondary market (full sale, no sublet of use). OMP (in case of OTC TSO) will report: Shipper A sold 40 to shipper B, price XYZ. TSO reports to ACER: contractual change of the original contract: Shipper A contracted amount is now 60. ACER will not know the reason for the modification of the contract (why the quantity amount was changed), which could be due to:

  • the shipper surrendered 40 to the TSO;
  • the TSO withdrawn 40 from the Shipper because he systematically did not use the capacity (LT UIOLI);
  • the Shipper sold the capacity at the secondary market?

Does ACER need to know the reason for the modification of contract (changed quantity amount) when the contractual change is reported?

In case that ACER needs to know the reason for a contractual change is it possible this reason to be specified and reported through the current Gas Capacity Allocation schema. If yes – which elements and codes shall be used for this purpose?

Which codes shall be used for reporting of capacity change due to surrender and LT UIOLI mechanisms, secondary market transactions etc?

In case that the current Gas Capacity Allocation schema does not allow to specify the reason for a contract modification, does ACER intend to request a change of EASEEgas Gas Capacity Allocation schema?


Answer:

The Agency currently does not plan to add such an additional field to the schema.

The changes should be visible since the modifications need to be reported and the capacity right identification remains the same.

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FAQs on transaction reporting – Question III.4.2.13

According to the schema for gas transportation transactions reporting: urn-easee-gas-eu-edigas-remit-gascapacityallocationsdocument-5-1.xsd, the only currency code allowed is EURO.

Please see the document Edig@s Message Implementation Guidelines, schema: Gas Capacity Allocation, element 3.1.3.15 Currency.Code.

Does ACER intend to change this schema/element in order to be able to accept reports for transactions performed in other currencies (valid for UK, and the EU countries outside the monetary union Eurozone)?

Or does the Agency require conversion from the different currencies to EURO? If yes, what are requirements for this conversion?

What exchange rate shall be used?


Answer:

The Agency, after consulting relevant parties, established procedures, standards and electronic formats based on established industry standards for reporting of information referred to in Articles 6, 8 and 9 of the Implementing Acts. The current schemas foreseen for data reporting to the Agency under REMIT are the result of extensive consultations with stakeholders during 2014 and 2015.

This includes the accepted values for the currency code in the above-mentioned schema. The Agency will base data collection as of 7 April 2016 on the currently applicable schemas in order to facilitate reporting for all reporting parties. This is why the Agency, for reasons of legal certainty and consistency, will currently not modify the schema in the near future. The Agency is currently aiming at reviewing the current schemas for data reporting in early 2017. The Agency will consult relevant parties on material updates of the referred procedures, standards and electronic formats.

In the light of the above, the only currency code allowed for the relevant schema is EUR. Prices which were originally not expressed in EUR should be converted to EUR.

The Agency recommends using the last available ECB reference rate for the currency conversion at the time before the trade is concluded. Please refer to https://www.ecb.europa.eu/stats/exchange/eurofxref/html/index.en.html for further details on the ECB’s reference rate updates.

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FAQs on transaction reporting – Question III.4.2.14

According to the schema for gas transportation transactions reporting: urn-easee-gas-eu-edigas-remit-gascapacityallocationsdocument-5-1.xsd, the only Primary Market Participant identification coding scheme allowed is 305 (EIC). Please see the document

Edig@s Message Implementation Guidelines, schema: Gas Capacity Allocation, element 3.1.4.2.

In case that a TSO shall report data about a transportation contract concluded outside an OMP and the respective client of the TSO (Primary Market Participant) is not registered as Market participant, neither possess EIC, how shall it be identified in the report file when the only allowed coding scheme is 305?


Answer:

The Agency, after consulting relevant parties, established procedures, standards and electronic formats based on established industry standards for reporting of information referred to in Articles 6, 8 and 9 of the Implementing Acts. The current schemas foreseen for data reporting to the Agency under REMIT are the result of extensive consultations with stakeholders during 2014 and 2015. As a result of the aforementioned consultations, only EIC codes are accepted for identifying the reporting parties when reporting gas and electricity transportation contracts.

All reporting parties need to make sure to apply for an EIC code if they do not have one. The EIC codes can be obtained from the local issuing office. Since the EIC code will be used for reporting, it must be registered by the market participant’s registration as market participant according to Article 8 of REMIT.

Please note that it is the market participant’s responsibility for the completeness, accuracy and timely submission of data to the Agency and, where required so, to national regulatory authorities. Where a market participant reports those data through a third party, the market participant shall not be responsible for failures in the completeness, accuracy or timely submission of the data which are attributable to the third party. In those cases the third party shall be responsible for those failures, without prejudice to Articles 4 and 18 of Regulation (EC) No 543/2013 on submission of data in electricity markets. Market participants using a third party for reporting purposes shall nevertheless take reasonable steps to verify the completeness, accuracy and timeliness of the data which they submit through third parties. This includes the completeness and accuracy of the market participant identification through a relevant identification code.

Potential sanctions for the breach of reporting obligations as laid down in Article 8 of REMIT are defined at national level. In case reporting parties are facing technical issues when reporting data to the Agency, the Agency has established a contingency plan for Registered Reporting Mechanisms which provides all instructions on what reporting parties have to do in case of different scenarios that may impact the reporting. Any such possible technical issues should not be confused with possible breaches of the reporting obligations under REMIT.

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FAQs on transaction reporting – Question III.4.2.15

Reference to Articles 6(2) and 7(2) of the Implementing Acts

Article 6(2) of the Implementing Acts state that TSOs or third parties acting on their behalf shall report details of contracts referred to in Article 3(1)(b)(i) of the Implementing Acts including matched and unmatched orders.

Article 7(2) of the Implementing Acts state that in the case of auction markets where orders are not made publicly visible, only concluded contracts and final orders shall be reported. They shall be reported no later than on the working day following the auction.

How should TSOs understand the provisions of Articles 6(2) and 7(2) of the Implementing Acts?

Shall the TSOs or third parties acting on their behalf report all orders (matched and unmatched) or only information about the concluded contracts as the result of successful orders?


Answer:

It is the Agency’s current understanding that each auction rounds can impact the final price for transmission capacity.

Accordingly, all orders matched and unmatched which were taken into consideration for the calculation of any auction round need to be reported.

Please note that orders (matched or unmatched) are not relevant for back loading.

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FAQs on transaction reporting – Question III.4.2.16

Reference to Article 7(5) of the Implementing Acts  in case of Over-nomination.

Article 7(5) of the Implementing Acts stipulate that details of contracts referred to in Article 3(1)(b)(i) shall be reported as soon as possible but no later than on the working day following the availability of the allocation results. Any modification or the termination of the concluded contracts shall be reported as soon as possible but no later than on the working day following the modification or termination.

Over-nomination:

(According to Article 3(12) Regulation (EU) No 984/2013, CAM NC):

Network user nominates more than transport customer has booked.  According to CAM rule this constitutes a booking of interruptible within-day capacity.

How to understand the provisions of Article 7(5) of the Implementing Acts  in case of Over-nomination?

Should the cases of Over-nomination be reported?

If yes, as a new contract or as a modification of existing one?

What PROCESS_TRANSACTION.TYPE (corresponding to TRUM field 9 Transportation transaction type) shall be used in case of process not included in the Edig@s coding scheme such as:

  • over-nomination;
  • open Subscription Window;
  • open season;
  • storage allocation;
  • non-ascending clock pay-as-bid auction?

Answer:

The Agency, after consulting relevant parties, established procedures, standards and electronic formats based on established industry standards for reporting of information referred to in Articles 6, 8 and 9 of the Implementing Acts. The current schemas foreseen for data reporting to the Agency under REMIT are the result of extensive consultations with stakeholders during 2014 and 2015. As a result of the aforementioned consultations, the accepted values are limited to the relevant EDIGAS Code list document for valid codes.

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