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REMIT

New REMIT Questions and Answers document and quarterly released today – details

With just under a week to go before the first REMIT reporting go live, ACER have issued a new version 10 of their Questions and Answers document (here) and REMIT Quarterly (here). There are eight new answers, with one particularly important question highlighted below in bold.

Questions and Answers Version 10

New answers are as follows:

Registration

Erroneously selecting the option to become an RRM upon registration. (II.4.38) – If this happens email ACER and they will un-check the option.

What is the deadline for registration for market participants who only engage in intra group trades? (II.4.39) – It is the same as when the trade is executed with an external party, i.e. 7th October 2015 if the trades are executed on an Organised Market Place (OMP), 7th April 2016 otherwise.

Does a market participant that only engages in intra group contracts that fall below the 10Mw or 20Mw threshold need to register? (II.4.40) – No, since those who only engage in contracts below the threshold do not need to register, regardless of whether intra group or not.

RRMs

What happens if an RRM in the process of application has power of attorney revoked? (III.3.1)  – ACER should be informed straight away and a new power of attorney put in place.

Reporting

What happens if an OMP does not offer a data reporting agreement in according with the REMIT Implementing Act ? (III.3.21)   OMPs are obliged to offer a data reporting agreement, either directly or in conjunction with an approved RRM. 

How should “final customers” where a single consumption unit has the capability to consume more than 600 GWh/pa (trades with whom must be reported) inform their counterparties of the obligation? (III.3.22)  – Going forward, it is recommended that the obligation be embedded within the contract terms. For outstanding contracts, final customers are obligated to inform their counterparties, although it is recommended that awareness of the issue be raised by counterparties  to their customers.

Do contracts for supply and transportation of Biogas fall under REMIT? (III.23.23) – Yes, if the gas is to be injected into the natural gas system.

How should a new OMP be added to the official list? (III.5.2) – They should register with ACER using the process outlined. The process should be initiated well in advance of the OMP commencing operations.

REMIT Quarterly – Issue 3

The document mainly reviews information that is already known.

On page 1, it is reiterated that 27 RRMs are now approved out of 36 “pre registered” third party RRMs. There have also been 511 RRM applications from market participants.

Page 2 is dedicated to the consultation on how to disclose inside information (also see notes from the last public meeting). A new Manual of Procedures is to be issued soon.

Page 3 reviews the different documents available for reporting, including the new version of the TRUM (Trade Reporting User Manual) which has now been made official.

Page 4 examines the experience gained so far in the RRM application process, and also has a “myths and facts” section.

Page 5 looks at the number of cases in investigation at the moment, of which there are currently 45 (a record). It also reiterates that the Q+A now has 128 answers.

Page 6 concludes with a reminder of the timeline.

Conclusion

While the documents will provide some answers in certain scenarios (especially the one about OMPs having to offer data reporting agreements), with the deadline less than a week away, most market participants will be focused on ensuring that their data reporting agreements are in place, and ensuring that their OMPs and RRMs will comply.

Once the deadline has passed, we can expect the focus to quickly move to the second phase of reporting, which will present a considerable number of challenges.

About avivhandler

Aviv is the Managing Director of ETR Advisory, a niche consultancy focused on energy and commodity regulation. He has more than 20 years of experience in energy and commodity trading, credit, risk and financial technology. He has delivered a series of trading, credit and risk solutions to a wide variety of oil majors, power and gas companies and investment banks. Prior to founding ETR, he was Partner at SunGard Global Services, where he built a Centre of Excellence in European Energy Regulation. Before that, he founded Coherence, a consulting firm specializing in credit risk in commodity and energy trading as well as software product management. The credit practice ultimately became part of Sirius Solutions, where he was the Managing Director of Europe. He has also held management roles at KWI and Iris Financial, among other organizations. Mr. Handler holds a degree in computer science from Imperial College, University of London.

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