The Capacity Allocation Mechanisms Network Code (CAM NC) harmonises how Transmission System Operators (TSOs) offer and allocate available gas transmission pipeline capacity to network users. With Europe’s decarbonisation goals and the evolving gas market, the network code, last amended in 2017, now needs to be updated.

To address this, ACER initiated the revision process earlier this year. In autumn, ACER will hold a final public consultation to collect stakeholders’ feedback on its draft proposals.

The revision process

The revision process is informed by new regulatory elements from the hydrogen and gas decarbonisation package, ACER’s initial analysis of the network code's achievements and areas for improvement, alongside continuous dialogue with stakeholders:

• ACER conducted a preliminary analysis (from October 2023 to January 2024) to identify main achievements and potential improvements to the CAM NC (see the scoping consultation and the workshop).
• These findings were shared with the European Commission, which prompted ACER to initiate the revision process.  
• In spring 2024, ACER developed a policy paper proposing potential improvements to the CAM NC, and sought feedback through a public consultation.
• A technical workshop was held in July 2024 to further discuss the proposed revisions with the consultation respondents.

What are the next steps?

ACER will hold a final public consultation from 26 September to 25 October 2024 to ensure the proposed amendments effectively address market needs and deliver the expected improvements.  

The CAM NC revision process will conclude with ACER’s recommendations to the Commission (expected by December 2024), which is responsible for revising the text of the network code.

On 31 July 2024, ACER received a proposal from Transmission System Operators (TSOs) to amend the harmonised methodology for cross-zonal capacity allocation for the exchange of balancing capacity or sharing of reserves.

What is the methodology about?

This methodology provides a harmonised approach for effective allocation of cross-zonal capacity for the exchange of balancing capacity or sharing of reserves. Having an optimised allocation of cross-zonal capacity is important to:

• Foster the integration of balancing capacity markets.
• Lower the costs of procuring balancing capacity (hence the costs for tariff payers).
• Ensure the security of electricity supply.

The methodology harmonises the processes (i.e. market-based and co-optimisation) that compare the market value of cross-zonal capacity between balancing capacity and day-ahead electricity markets. These processes then allocate the available cross-zonal capacity to each market in a way that maximises overall welfare.

Why amend the methodology?

The current methodology was approved by ACER in July 2023.

Amending the methodology is necessary to clarify the governance of the market-based process, covering both its implementation and operation. This aims to ensure the process runs efficiently and encourage more TSOs to apply it.

Additionally, TSOs proposed to:

• Establish a process and governance framework to set different maximum limits for exchanging balancing capacity or sharing reserves.
• Amend the provisions to distribute congestion income among TSOs.
• Allow the possibility of delaying the implementation of the harmonised market-based process beyond 31 July 2026.

What are the next steps?

ACER expects to:

• Run a public consultation from 16 September to 14 October 2024 to collect views from stakeholders and inform its decision-making process.
• Reach a decision by 31 January 2025.

Update as of 30 January 2025: with its Decision 01-2025, ACER adopted the amended methodology.

Today, ACER publishes its report on the Danish non-transmission tariffs proposed by Energinet, Denmark’s Transmission System Operator (TSO). These tariffs cover the costs of Denmark’s emergency supply services, such as filling gas storage and providing emergency gas supply to non-protected consumers.

The proposed methodology includes:

• An ex-ante tariff, calculated using a postage stamp reference price methodology (RPM), which distributes emergency service costs equally among all non-protected consumers.
• An ex-post compensation, which adjusts cost allocation after gas is delivered based on the actual gas volumes received by each non-protected consumer during an emergency.

What are the key findings?

ACER evaluated the compliance of the proposed methodology with the requirements of the Network Code on Harmonised Transmission Tariff Structures (NC TAR) and notes:

• The ex-ante postage stamp tariff does not consider the varying risks of supply interruption among different non-protected customers.
• Non-protected consumers receive equal protection for the first 72 hours after emergency measures begin. After this period, the risk of gas supply interruptions may depend on the remaining gas volumes.
• Designing a cost-reflective ex-ante tariff is highly challenging due to information confidentiality and the uncertainty of supply emergencies.
• In the event of a supply emergency, the ex-post compensation increases cost reflectivity by adjusting the initial tariff to reflect the actual level of interruption for each non-protected customer.
• The consultation document lacks sufficient information on the functioning of the ex-post compensation mechanism.

ACER concludes that the proposed non-transmission tariffs comply with the NC TAR and recommends the Danish regulatory authority to ensure greater transparency by providing more detailed information on the ex-post compensation mechanism in their next decision.

Access all ACER reports on national tariff consultation documents.

REMIT (Regulation on Wholesale Energy Market Integrity and Transparency) provides an EU framework for the transparency and integrity of energy markets and aims to deter market participants from manipulating the market. It plays an important role in protecting the interests of companies and consumers and ensuring trust in energy markets. The Regulation was revised this year to ensure it keeps pace with evolving market dynamics.

What is in the latest REMIT Quarterly?

The REMIT Quarterly is ACER’s main channel of communication with stakeholders on REMIT-related matters, providing updates on ACER’s REMIT activities.

The 37th edition covers the second quarter of 2024 and features:

• Key takeaways from the ACER and European Commission joint workshop on REMIT II implementation, held on 11 June 2024.
• Further details on ACER’s public consultation on new data reporting requirements of the REMIT Implementing Regulation’s Annex, running until 6 September 2024. Have your say here.
• The announcement of a joint roundtable meeting on proposals for REMIT II delegated acts for Registered Reporting Mechanisms (RRMs) and Inside Information Platforms (IIPs), scheduled for 17 and 18 September 2024.
• Updated overview of the sanction decisions under REMIT for 2024, with 345 cases under review at the end of the second quarter.
• Statistics for RRMs’ contingency reports.
• Overview of trading on organised market places in the second quarter of 2024.
• Other REMIT updates.