namibia market structure msb: final design … › images › docs › economic_regulation › ...1....
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Namibia Market Structure
MSB: Final Design Amendments
JUNE 2019
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1. To present final changes to the Market Design following feedback from MME
2. To show calculations for the wheeling tariff for Distributors
3. To demonstrate wheeling model and example results
20 June 2019 MSB Presentation - Distributors Workshop 2
INTRODUCTION
Purpose of this Workshop
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TRADING
ARRANGEMENTS
20 June 2019 MSB Presentation - Distributors Workshop 3
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19 June 2019 MSB Presentation - Funders Workshop 4
TRADING ARRANGEMENTS
1a
Contestable Customers
MSB(SO/MO)
IPPs (Existing)
Imports (NP)
Generation (NP)
REDs, LA, & RC
Distribution Customers
Embedded IPPs
Exports (NP)
IPP
NP Tx Connected Customers
Captive Generation
Off-grid & mini-grids
Eligible Sellers
Exporter
Transactionall Flows from Seller to Buyer
Existing arrangementNew optional arrangement
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19 June 2019 MSB Presentation - Funders Workshop 5
TRADING ARRANGEMENTS
1b
Contestable Customers
MSB(SO/MO)
IPPs (Existing)
Imports (NP)
Generation (NP)
REDs, LA, & RC
Distribution Customers
Embedded IPPs
Exports (NP)
IPP
NP Tx Connected Customers
Captive Generation
Off-grid & mini-grids
Eligible Sellers
Exporter
Trader Trader
Transactional Flows from Seller to Buyer
Existing arrangementNew optional arrangement
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1. Phase 1a: Sep 2019 - June 2021; Tx Customers only
2. Phase 1b: July 2021 – June 2026; Tx + Dx ≥ 1MVA
3. Two stage approach to allow Distributors to unbundle sufficiently to enable wheeling
for their customers
4. Phase 2: July 2026 – onwards; Tx + Dx (as determined by Regulator); Imports
allowed
5. Imports only allowed from 2026 to support government policy of self-sufficiency and
to align with unwinding of current import contracts
19 June 2019 MSB Presentation - Funders Workshop 6
TRADING ARRANGMENTS
Phase 1 vs. Phase 2
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19 June 2019 MSB Presentation - Funders Workshop 7
TRADING ARRANGEMENTS
2
Contestable Customers
MSB(SO/MO)
IPPs (Existing)
Imports (NP)
Generation (NP)
REDs, LA, & RC
Distribution Customers
Embedded IPPs
Exports (NP)
IPP
NP Tx Connected Customers
Captive Generation
Off-grid & mini-grids
Eligible Sellers
Exporter
Trader Trader
Transactional Flows from Seller to Buyer
Existing arrangementNew optional arrangement
Importer
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ELIGIBILITY CRITERIA
20 June 2019 MSB Presentation - Distributors Workshop 8
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20 June 2019 MSB Presentation - Distributors Workshop 9
ELIGIBILITY CRITERIA
Summary
Phases1a
(1st Sep 2019 – June 2021)
1b
(July 2021 – June 2026)
2
(July 2026)
Contestable Purchases -National Cap
• 30% of total national purchases • 30% of total national purchases • As determined by Regulator
Contestable Purchases –Customer Supply Point Cap
• 30% of total customer purchase • For Distributors this volume is
reduced by 30% of the purchases by ≥1MVA connected customers
• As determined by Regulator • As determined by Regulator
Contestable Customers • Tx Connected
• Tx connected• Dx connected (≥1MVA)• Dx connected (<1MVA) as
determined by Regulator
• Tx connected• Dx connected (≥ 1MVA)• Dx connected (<1MVA) as
determined by Regulator
IPPs
• Licensed• Tx or Dx connected• Capacity ltd by sales to Contestable
Customers
• Licensed• Tx or Dx connected• Capacity ltd by sales to Contestable
Customers
• Licensed• Tx or Dx connected• Capacity ltd by sales to Contestable
Customers
Exporters• Licensed• No size limit
• Licensed• No size limit
• Licensed• No size limit
Traders• On application and approval by
Regulator; Licensed• No trading volume limit
• Licensed• No trading volume limit
• Licensed• No trading volume limit
Importers • Not allowed • Not allowed• Licensed• Capacity ltd by sales to Contestable
Customers
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REGULATION OF
MARKET ENTRY
20 June 2019 MSB Presentation - Distributors Workshop 10
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20 June 2019 MSB Presentation - Distributors Workshop 11
REGULATION OF MARKET ENTRY
Customers
Customers can register for the MSB, provided that:
• They meet the Contestable Qualifying Criteria at a Supply Point, defined by the
Regulator for each Market Phase.
• They can identify the specific Eligible Seller with which they will transact.
• They can identify the specific generating unit that will supply them.
• The volumes specified in the transaction are within their allocated Contestable
Purchase limits.
• They pay their MSB Participation Fee.
It should be noted that Contestable Customers can:
• De-register from participation in the MSB market at any time.
• Apply to the ECB to amend their registration for the purposes of identifying an
alternative Eligible Seller.
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20 June 2019 MSB Presentation - Distributors Workshop 12
REGULATION OF MARKET ENTRY
Participation Fee
An “MSB Participation Fee” must be paid by Contestable Customers in order to register
and participate in the MSB market. The Participation Fee is effectively a “license fee”,
charged to Contestable Customers in order to recover the Regulator’s costs associated
with registration and regulation of Contestable Customers in the MSB.
• The MSB Participation Fee will have the following characteristics:
• The Fee will be calculated on the Contestable percentage (maximum 30% in Phase
1a and 1b) of a Contestable Supply Point Capacity.
• Each Contestable Supply Point will be calculated individually.
• The fee value will be determined by the Regulator
• Annual Fees are not refundable on de-registration from the MSB.
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TARIFF UNBUNDLING
20 June 2019 MSB Presentation - Distributors Workshop 13
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20 June 2019 MSB Presentation - Distributors Workshop 14
TARIFFS
Unbundled Services
Service Customers Generators
Energy (Utility) ✓ -
Less Wheeled Energy Rebate (✓) -
Wheeled Energy Addback (✓) -
IPP Purchases (✓)
Balancing - ✓
Tx/ Dx Use of System ✓ -
Tx/ Dx losses ✓ (✓)
Network Capacity Reserve - (✓)
Distributor Wheeling Charge (✓)* -
Reliability ✓* -
Net Billing (Banking/ Storage) (✓) (✓)
Customer service ✓ ✓
Levies ✓* -
VAT ✓ ✓
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20 June 2019 MSB Presentation - Distributors Workshop 15
TARIFFS
Calculating the Distributor’s Wheeling Charge
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WHEELING
20 June 2019 MSB Presentation - Distributors Workshop 16
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20 June 2019 MSB Presentation - Distributors Workshop 17
WHEELING
Simulated Wheeling Transaction in Model
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Item Assumption
Eligible Generator Selling Price NAD1.00/kWh
Imbalanced Energy 5% of Generator’s production
Peak Coincidence Factor (Dx to Customer) 0
Peak Coincidence Factor (Tx to Dx) 0
Tx Losses caused by Generator 0%
Dx Losses caused by Generator 0%
Technical Losses (Tx Customers) 10%
Technical Losses (Dx Customers) 10%
Customer purchases from Eligible Generator 100%
20 June 2019 MSB Presentation - Distributors Workshop 18
WHEELING
Key Assumptions
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20 June 2019 MSB Presentation - Distributors Workshop 19
WHEELING
Scenario 1 – Results (No Wheeling)
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20 June 2019 MSB Presentation - Distributors Workshop 20
WHEELING
Scenario 1 – Results (Wheeling)
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20 June 2019 MSB Presentation - Distributors Workshop 21
WHEELING
Scenario 1 – Results (Wheeling)
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20 June 2019 MSB Presentation - Distributors Workshop 22
WHEELING
Scenario 2 – Results (No Wheeling)
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20 June 2019 MSB Presentation - Distributors Workshop 23
WHEELING
Scenario 2 – Results (Wheeling)
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20 June 2019 MSB Presentation - Distributors Workshop 24
WHEELING
Scenario 2 – Results (Wheeling)
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20 June 2019 MSB Presentation - Distributors Workshop 25
WHEELING
Scenario 3 – Results (No Wheeling)
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WHEELING
Scenario 3 – Results (Wheeling)
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WHEELING
Scenario 3 – Results (Wheeling)
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WHEELING
Scenario 4 – Results (No Wheeling)
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20 June 2019 MSB Presentation - Distributors Workshop 29
WHEELING
Scenario 4 – Results (Wheeling)
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20 June 2019 MSB Presentation - Distributors Workshop 30
WHEELING
Scenario 4 – Results (Wheeling)
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END
20 June 2019 MSB Presentation - Distributors Workshop 31