The launch of the European balancing scheme slated to go live at the end of this year is set to be pushed back until June 2020 at the earliest.
Project Terre (Trans European Replacement Reserve Exchange) obliges National Grid and other transmission system operators to collaborate to build a European balancing market that will facilitate balancing in different regions.
National Grid ESO said French transmission system operator RTE had requested the delay after “difficulties with their implementation”. Because the GB route into the market is via France, National Grid has also requested a derogation and all the other TSOs bar Czech Republic are now holding fire.
In a letter to stakeholders, Richard Smith, head of commercial at National Grid ESO wrote: “This does not mean that we are pausing work on our IT systems, we will continue to focus on the implementation of wider BM access for go-live in 2019 which is expected to deliver benefits of over £100m per annum. We will also ensure that our IT systems are ready to implement when RTE go live with Terre.
“We will also support all TERRE parallel run testing which is being re-planned at this time.”
Flex market participants expressed dismay.
“It’s disappointing,” said Jonathan Ainley at Kiwi Power. He urged National Grid to “use this time wisely” so that the market and support systems are “ready to go from day one”.
Rajiv Gogna, energy product development lead at Lane Clark & Peacock, said while the implementation delay is “disappointing, it shouldn’t detract from National Grid’s existing commitment to implementing wider access to the Balancing Mechanism. This will allow additional flexible providers to effectively participate in this market, increasing competition and driving down costs for consumers”.