In April the project “Market Coupling between Denmark and Germany” advanced from the conceptual phase into the implementation phase. Market coupling allows highly efficient use of existing cross-border interconnections and is an important step towards integrating wholesale electricity markets. With the market coupling procedure, so-called implicit auctions – joint allocation of energy and cross-border transmission rights – will be held on a daily basis. Operation is expected to start in the 4th quarter of 2007.

In a cooperative spirit, the five project initiators – the transmission system operators E.ON Netz, Energinet.dk and Vattenfall Europe Transmission and the power exchanges Nord Pool Spot and EEX – made every necessary effort to accelerate the implementation. Since October 2006, it has only taken the parties a few months to develop the idea, sign a Memorandum of Understanding, draft the concept and now start the implementation in order to make market coupling available to the market at the earliest possible point in time. Against this background, an external project manager from E-Bridge Consulting was appointed, who will be working full-time with the project, coordinating six task groups entrusted with elaborating implementation and decision proposals in relation to business process description, budget calculation, IT specification, company foundation, contractual framework and communication.

The current initiative comprises the interconnector between E.ON Netz and Energinet.dk and the one between Vattenfall Europe Transmission and Energinet.dk (the Kontek Link) coupling the German and Danish market. The relevant processes and IT system for market coupling will, however, be designed to permit and support extensions on to other interconnectors or markets.

The results of the cooperation will be available to other transmission system operators and power exchanges. The respective European regulators follow the project closely and have already welcomed the efforts made by the five parties as part of the European Regulators’ Electricity Regional Initiative, whose object is to promote enhanced electricity market integration.

Contact:

E.ON Netz GmbH: Dr. Christian Schneller, T: +49 921 915-4030
Energinet.dk: Lene Sonne, T: +45 23 338802
Vattenfall Europe Transmission: Gert Schwarzbach, T: +49 30 5150-2703
Nord Pool Spot AS: Jǿrn Limann, T: +47 920 213-85
European Energy Exchange AG: Dr. Jan Sierig, T: +49 341 24680-515