Source - Elmarknadsrådet Meetings 1 and 2 2024 (Feb-May)

Minutes and consolidated presentation materials for the first and second Elmarknadsrådet meetings of 2024.

Documents

Meeting 1 — 8 February 2024

Location: Svenska kraftnät, Sundbyberg. 10:00–15:30.

Chair: Anna Jäderström (tillförordnad ordförande — Malin Stridh was tf chef for Division System; no further information on the new chief at meeting time)

Attendance: Anna Jäderström (chair + Svk rep), Linnea Achour (sekreterare), Mårten Bergman (Svk); Magnus Thorstensson (Energiföretagen Sverige); Cecilia Thorsson (Varberg Energi, balansansvarig); Morgan Andersson (Bixia, producent); Per Wikström (Ellevio, elnätsföretag); Kristian Gustafsson (Vattenfall, producent); Susanne Franzén (Fortum, producent); Daniel Köbi (Jämtkraft elnät, elnätsföretag); Emma Tronarp Trawén (E.ON, balansansvarig); Filip Englund (Holmen, elanvändare); Lars Skoglund (Ntricity, BSP). Michelle von Gyllenpalm (Svenskt Näringsliv) absent.

Key claims

Svk regleringsbrev 2024:

• New government assignment: map where production is needed and where consumption and flexible resources should connect; report due February 22, 2025
• Assignment to set target levels for transfer capacity for 2030, 2035, 2040; report due October 1, 2024
• New regional energy planning support role (regional energy planning is county board responsibility; Svk to support)
• Government appointed Elmarknadsutredning (chaired by Bo Diczfalusy); external expert group; final report due April 2025

Energy policy goals (summary by Magnus Thorstensson):

• Proposal (not final proposition): planning target 300 TWh by 2045; delivery security target; energy efficiency target; Samverkansråd at Svk to be established (Energiföretagen has long requested this)
• Energy policy proposition to be presented March 12, 2024

Mothandel och omdirigering (Tania Pinzón):

• New “complementary model”: production not normally sold on day-ahead + DA-active consumption that can be reduced, procured to enable Svk to raise capacities to DA coupling
• Criteria: location south of “snitt 3”; minimum 45 MW; minimum 85% availability; aggregated resources ok (same connection point); DA-active consumption must have non-price-dependent bids
• Most recent procurement: 10 invited (non-obligatory market dialogue), 6 prequalified, 4 bids, 3 awarded
  • Göteborg Energi AB (Rya kraftvärme + Rya värmepumpar, aggregated): 205 MW Oct–Apr / 150 MW otherwise; contract Dec 2023–Dec 2025, +1-year option
  • Sydkraft Thermal Power AB (Karlshamnsverket): 96 MW Nov 16–Mar 15 / 315 MW otherwise; contract Dec 2023–Nov 2025
  • Tekniska verken i Linköping (Gärstad gaskombianläggning + P2G3): 47.5 MW Nov–Apr; contract Dec 2023–Oct 2026, +1-year options to Apr 2030
• Structural concern: Mårten Bergman raised that systematic countertrading creates artificial capacity and distorts price signals; short-term market benefit vs long-term systemic cost
• Intraday auctions seen as future countertrading tool; mFRR EAM and 15-min MTU will cause more frequent HVDC pole reversals → separate intraday countertrading procurement needed

FCA metodutveckling and Svk EPAD pilot (Linnéa Nyman):

• Pilot started February 2023; auctions approximately every two weeks (SE2, SE3, SE4, both buy and sell)
• 22,000 GWh supplied through EPAD auctions during full year 2023; growing participant count
• Quarterly result reports; fuller 2023 analysis forthcoming
• FCA Art. 30 four-yearly NRA review: Finland found to have insufficient hedging → Svk and Fingrid could not agree on method → now with Swedish Ei and Finnish EV; Energinet resolved Denmark separately
• SE-LT: joint methodology under development; timeline under revision
• EPAD model compatible with more products; can adapt over time

BSP/BRP status (Anna Jäderström):

• Balansansvarsavtalet 4620 terminated (3-month notice period); new BRP agreement from May 1, 2024
• Actors wishing to become balansansvarig before April 30 must sign current 4620-8
• BSP/BRP remiss closed February 2; phased rollout plan communicated at aktörsforum; significant industry pushback against phased rollout (costs without benefits); Svk preparing remissbemötande by March 1
• BSP and BRP agreements to be published March 1 pending Ei methodological approval
• BSP responsible for ensuring adequate subscriptions/agreements with DSOs for the services it intends to deliver; no central register currently — NC DR will address this
• Ei approval requires phased implementation after May 17; full BSP role to come later (timeline TBD)

Tarifföversyn (Fia Balint):

• Ei has issued new tariff design föreskrifter applicable to all grid levels (stamnät, regionnät, lokalnät); apply by January 1, 2027
• Reference group nominated through Elmarknadsrådet and Planeringsrådet
• Four-component tariff: (1) energiavgift (short-run variable costs, mainly losses); (2) effektavgift (forward-looking investment costs); (3) kundspecifik (metering, administration); (4) fast avgift (residual cost recovery)
• Critical interaction: region and lokalnät must adapt in parallel — cannot wait for Svk’s result
• Svk exploring a reactive power component (not in Ei’s föreskrifter); requires dispensation from Ei
• Discussion: Kristian called the tariff “the most important market design question right now”

Kompensationsmodell for aggregators — government assignment (Marko Miletic / Karin Nikavar):

• Assignment received in 2023; report due September 2024
• Svk interpretation: covers demand flexibility only (not production)
• Two types of demand flexibility: implicit (price signal) and explicit (market participation); project exploring whether implicit flexibility can be included
• Exploring which markets to cover (day-ahead, intraday, balancing markets, local flexibility markets)
• Compensation must strictly cover costs; must not be a barrier to aggregation; may consider benefits to other actors
• Alternatives: “corrected model” (metered values adjusted on invoice — customer not billed on actual) vs other models
• Rebound effect: delayed consumption after flexibility activation; difficult to handle

Government assignment: flexibility need (deluppdrag 5, Christina Simón):

• Joint TSO/Ei/Energimyndigheten assessment; reports for 2025/26 and 2030/31
• Flexibility categories: energy (day-ahead), intraday/balancing, transmission (grid overload)
• Enablers: market places, roles, metering requirements, knowledge and incentives
• Analysis result: flexibility can reduce daily/weekly/seasonal residual load variation; balancing error (“prognosfel”) significantly smaller with available flexible resources included
• Resources expected timeline: large batteries and heat pumps first; hydrogen from 2030
• Key conclusions: need is unambiguously growing; all actors have reasons to be flexible; sectoral coupling (hydrogen, batteries, energy storage) important; 5 development areas already in progress (including compensation model, undermätning regulation)

Roadmap (Mårten Bergman):

• Q4 2023 deliveries all completed per plan
• FCR marginal pricing from February 1, 2024 — TSO cost increases (all accepted bids now paid at margin); no visible behavior change in bidding yet
• Q2 2024: Intraday auctions; BSP/BRP contract split; bidding zone proposals (delayed from Q2 due to modeling complexity — liquidity study simulation needed)
• Flowbased: delayed from March/April to October 2024 (prerequisite for mFRR EAM December, 15-min MTU Q1 2025)
• Flowbased consultation: 19 responses; SE/FI actors more critical, NO more supportive; concerns about non-intuitive flows and arbitrage on intraday; CNEC secrecy (Sweden cannot publish limiting elements unlike NO/FI/DK)

LMA2024 (Elis Nycander):

• Four scenarios: two electrification scenarios (highest load), småskaligt förnybar, mixat (medium)
• Largest load growth: industry (including fossil-free steel); hydrogen significant from 2030; EVs to ~35 TWh in high scenarios
• Production: up to 50 GW onshore wind in renewables scenarios; nuclear up to 15 GW (partly SE1); offshore wind 6–16 GW — lower than LMA2021 because endogenous profitability assessment replaces fixed planning assumptions
• Result: high-load scenarios → Sweden from net exporter to net importer; snitt 1 becomes binding northward flow
• Conclusion: expansion of snitt 1 has value in all scenarios; hydrogen infrastructure and electricity network expansion have similar effect on SE1 prices → joint planning essential

Supply security — government assignment (deluppdrag 3, Joacim Tegnesjö):

• Six-part assignment; four parts to Svk, two to Energimyndigheten
• Adequacy and system stability in scope; civil preparedness excluded
• All generation types needed for system stability; no single type dominates
• Some future hours: virtually all production from power-electronics-connected plants — needs planning
• Proposal: legislation should clarify that DSO level bears a system responsibility (Daniel Köbi and Per Wikström: important to specify voltage level; need agreed framework for TSO-DSO cooperation)
• Svk to develop requirements for connected facilities to contribute necessary system capabilities
• Ö-drift (island operation) and dödnätsstart (black start) review underway; exploring whether black start resources can be procured under EU/ER regulation instead of current emergency legislation

Meeting 2 — 16 May 2024

Note: Minutes dated 2024-05-31. The meeting was May 16.

Attendance: Same as Meeting 1 but Michelle von Gyllenpalm again absent; Filip Englund (Holmen) partially replaced by Tomas Hirsch (SSAB) as ersättare for the large user seat.

Inledning:

• New Division System chief: Eva Vitell, starting May 21; Malin Stridh to return as Elmarknadsrådets chair
• April: FCR and mFRR capacity prices very high; procurement difficulties; Svk considering simplified prequalification for mFRR downregulation (faster prequalification for wind power given weather-dependent testing)
• Morgan Andersson: retrieving (återköp) mechanism would help variable production participate — less punitive for occasional non-delivery
• Svk also exploring prioritized prequalification for FCR-D ned (specific shortage identified)

Roadmap (Mårten Bergman):

• Q2 deliveries: Intraday auctions (IDA) go-live June 13 at 60-min MTU; Svk ready, final European tests ongoing
• BSP/BRP: May split is contract structure only — no role change; independent BSP implementation timeline to be communicated in autumn
• Bidding zone proposals delayed to Q4 due to more complex modeling than expected; will align with EU-wide study
• Morgan: market must know future bidding zones — financial market liquidity depends on it; implementation if zones change earliest 2027
• mFRR EAM: Q4 2024 (December); trilateral mFRR CM (SE+FI+DK — Statnett joins after 15-min MTU) Q4
• 15-min MTU: Q1 2025 first on intraday, then day-ahead
• Strategic reserve: EU state aid dialogue ongoing; current effektreserv contracts expiring; likely update at autumn Elmarknadsråd
• Data publishing platform for near-realtime: modern platform planned late 2025; Energinet piloting real-time regulation data

Market surveillance — REMIT (Joel Viil):

• Svk is PPAT (Person Professionally Arranging Transactions) under REMIT; obligations under Articles 3 and 5 (insider trading, market manipulation)
• ACER guide used as basis; automated script + manual flagging (from control room or procurement process leaders)
• Identified risks: abusive squeeze/market cornering; physical withholding; cross-market manipulation; order-based behavior; false information; price-setting with small outlier bids
• Process: if violation cannot be excluded → contact actor for explanation → if still unresolved → Suspicious Transaction Report (STR) to Ei
• Limitation: Svk cannot see actors’ intraday and day-ahead behavior (only balancing markets)
• FCR monitoring started in 2024; mFRR and aFRR to follow by end of 2024
• REMIT II review noted; process update required

Co-optimisation (Magnus Brolin / Mia Immonen):

• Three methods in EBGL for cross-zonal balancing capacity allocation: co-optimised; market-based (current Nordic); economic efficiency analysis
• ACER favors co-optimised; publishing consultation study May 27; consultation May 27–June 19; ACER decision September 2024
• Co-optimisation: simultaneous clearing of DA and capacity markets in one algorithm; theoretical welfare gains; capacities not reserved sequentially
• Two implementation models: (A) actors submit separate spot and capacity bids linked so they do not oversell; (B) actors submit only spot bids with upward/downward flags; algorithm prices the capacity bids
• Nordic concerns: current model already satisfies EBGL; Nordics further ahead in cross-border capacity exchange than Continental focus of ACER analysis; vattenkraft creates different optimization landscape; 10% cap on capacity reservation; risk of “contaminating” spot price in Model B
• Svk position: co-optimisation is optional; Svk prefers to wait and see; will ensure Nordic input to ACER consultation

HVDC handling at Flowbased go-live (Mårten Bergman / Victoria Bjellerup):

• MIND-type cables (Fennoskan, SwePol Link, Kontiskan, Baltic Cable): maximum 1,000 pole reversals/year
• Fennoskan: 4h between reversals (Italian TSO Terna tested 2h successfully — applied to Kontiskan and Fennoskan; SwePol maintains 4h per PSE requirement)
• Mitigation measures planned:
  1. Proactive monitoring and follow-up
  2. Implicit losses on Kontiskan (approved); Fennoskan: parallel AC connections make implicit losses counterproductive — alternative measures
  3. Ramp restrictions: SwePol 600→300 MW/h from Flowbased go-live; Kontiskan 300 MW/h at mFRR EAM go-live; Fennoskan: ramp restrictions to prevent large shocks (Fennoskan 1 already damaged)
  4. Intraday countertrading via third-party portfolio manager (Energinet already does this; Svk to use same model); volume/timing announced via NUCS; preference for IDA to increase liquidity
  5. Dynamic Profile Selection (DPS) — two cables run in opposite directions
  6. Quarterly Polarity Reversal Elimination (QPRE) — only ramp at hourly transition; implemented on SwePol Link
• Svk and Energiet/Fingrid have agreed a Nordic routine for HVDC countertrading responsibility (each TSO handles own zone)
• Dialogue with Ei on market impact and transparency of Svk’s intraday trading

FFR / rotationsenergi (Staffan Engström):

• LMA2024 scenarios show rotational energy declining below levels FCR-D/N were designed for
• Svk procures static FFR annually (activated when rotational energy < 155 GWs); rarely needed currently
• Nordic collaboration underway; investigating dynamic FFR variants (up, down, N)
• Reference group second meeting week 21; ambition to engage industry with more concrete plans in autumn

Relevance to wiki

• Elmarknadsrådet: 2024 member composition (Anna Jäderström as chair meetings 1–2; Filip Englund/Holmen as large user); governance context; government assignments
• Balancing Markets: REMIT market surveillance; co-optimisation debate; FCR marginal pricing from Feb 1; mFRR EAM preparation; HVDC pole reversal mitigation; intraday countertrading model
• Flow-Based Capacity Calculation: Flowbased delay to October 2024; CNEC secrecy; HVDC mitigation measures
• Aggregation: Kompensationsmodell assignment; demand-only scope; reference group; September 2024 report target
• BSP and BRP Roles: May 2024 BSP/BRP contract split (structure only); independent BSP timeline deferred to autumn
• Swedish Household Demand Response — Consumer Adoption and Barriers: Deluppdrag 5 flexibility quantification; enabler framework
• Strategisk Reserv: Strategic reserve EU state aid dialogue; effektreserv contracts expiring; update expected autumn 2024
• Regulatory Calendar: FCR marginal pricing Feb 1 2024; IDA go-live June 13 2024; Flowbased go-live October 2024; energy policy proposition March 12

Data gaps

• Result of ACER co-optimisation consultation and September 2024 decision — did ACER proceed with a binding method?
• EPAD pilot evaluation: whether Svk extended the pilot beyond 2025, and whether EEX area contracts affected liquidity
• Outcome of reactive power component dispensation application to Ei
• Whether simplified prequalification for mFRR downregulation was implemented and its effect on bid supply