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FAQs on transaction reporting – Question II.3.4.7

Reference to documents: TRUM 2.0 page 20

We  would like to discuss a trading example and ask you how to report it:

Scenario:

  • Company A sells electricity (bilateral, physical settlement) to Company B for the whole year to spot market conditions
  • Company B pays twelve equal monthly payments to Company A. The amount of the payments is estimated before the beginning of the year. The estimation is based on the volume that was sold the year before and the estimated prices in this year. The monthly bills therefore don’t display a volume.
  • At the end of the year, there is a final invoice. The final invoice is offset with the twelve payments. The final invoice displays the sold volume in this year (it is calculated after the whole year) and the calculation of the difference between the twelve monthly payments and the sold volume to a specific price (derived by the spot market). The final invoice can be positive or negative depending on whether the sum of the monthly payments is above or below the sold volume x sold price.

In our understanding we should use REMIT Table 2 scheme to report the contract (no quantity and price is known before the final invoice). And for the execution it is our understanding that we report the transaction for the whole year using the final invoice with the defined price and volume at the end of the year (table 1)?

In our understanding we shouldn’t report the monthly payments (TRUM 2.0 page 20) because there is no specifying of an outright volume and price.


Answer:

Based on the information provided above, it is our view that the contract should be reported by using Table 2 and one EXECUTION at the end of the year. Please note that this would apply only to contract with pre-payments.

Last update: 10/07/2017   RSS_Icon Subscribe to this Page’s RSS