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Enron Mail |
Information on capacity release program (VPP) in France
Letter below to the consultants of EDF Decision on Merger imposing capacity release Trustee mandate that we proposed to the EU Initial VPP proposal by EDF -----Original Message----- From: Sankey, Ross Sent: 01 June 2001 09:51 To: de Gaulle, Pierre Cc: Gaillard, Bruno; Philip Davies/LON/ECT@ENRON; Brun, Raphael; Brod, Simon; Styles, Peter; Dindarova, Nailia; Shaw, Eric; Elliott, Mark Subject: RE: EdF capacity auctions All, I would suggest we need to do the following :- ? Register for the auction and receipt of the IM asap. Bruno could you please discuss with Mark and put together our registration document. I assume that ECTRL meets the criteria of a trader "registered" in an EU member state? Does not appear to be any need to deal with credit support or other regulatory "qualifiers" such as balancing agreements as yet. Mark - agree? Bruno - could you please take care of sending this registration letter (agree with Pierre who should act as principal contact). ? Establish once and for all the role of Trustee and CRE in the process of approving capacity release phasing, auction process for each phase and product specifications AND understand how the "consultation" process will work once we have the IM. Hence need to discuss with MTF, then Trustee and CRE asap ie in June if possible. Preferably before we meet again with PWC/Roth.... In addition to Pierre's comments, the PIM also states that strike prices at least are subject to Trustee review but a number of areas need to be questioned. ? Capacity Release Phasing. PIM confirms the 5 year period of the remdey but also says a review can be requested after 3 years. Bruno - you need to review the remedy doc, but I do not see how a 2 year phasing of capacity release complies with the remedy (at least in spirit). We would suggest there is no impediment to offering the FULL remedy in a single phase. If theere is insufficient demand they can always have a fall back position to release unsold capacity on a 6 monthly or annual basis through the 5 year period. The current proposal is no more than EdF trying to minimise capacity release and/or extract max value (can't blame them for trying but it is not what we want or what remedy requires). EdF's only real argument is that phasing will allow more new suppliers to enter at a later date as eligiblity threshold drops in France. However, since eligible demand already exceeds total capacity release this would limit development of competition to existing eligibles. As a minimum the release programme for all capacity should be clearly defined up front; not at the whim of EdF. Peter - thoughts on this and how, in context of remedy, we can argue for accelerated single phase auction (with possible reauctioning of unsold capacity over 5 years)? ? Auction Process : qualifying criteria likely to be more defined in IM; but no obvious problems here. I am less sure about nature of auction process. We obviously need to think it through more, but why not just have a simple process based on single sealed bids (or an electronic bid process). The use of price "clock" controlled by the auctioneer may allow a reserve price to be set which is clearly not the intent of the remedy - this should be set at zero for all product groups not subjectively "to ensure excess demand" but only for certain groups! ? Product Specs : need to understand what if anything can be changed here. Strikes seem to be subject to Trustee approval, but we need to understand what else can be influenced eg within day flex. Since we have already covered this in previous submissions to MTF, EdF etc this should be easy to identify as we go forward. Any comments? Ross -----Original Message----- From: de Gaulle, Pierre Sent: 01 June 2001 09:00 To: Sankey, Ross Cc: Gaillard, Bruno; Philip Davies/LON/ECT@ENRON; Brun, Raphael; Brod, Simon; Styles, Peter; Dindarova, Nailia Subject: RE: EdF capacity auctions & other EU news Point 1.5: This info is of a preliminary nature and is subject to change. In addition, it is mentioned in point 6 that registered companies for the auction will have the opportunity to ask questions and raise issues during conferences, which will be then considered by EdF. Specifications of the auction will be finalised by end August. This seems to leave some room for a complete feedback from registered companies. Let's discuss the content of the PIM. I suggest to arrange anothe meeting with PWC/Rothschild in the next few weeks (week 11-16 June). What about a potential meeting with the Trustee about the PIM? Pierre From: Ross Sankey/Enron@EUEnronXGate on 31/05/2001 19:31 To: Bruno Gaillard/Enron@EUEnronXGate, Philip Davies/LON/ECT@ENRON, Pierre de Gaulle/LON/ECT@ECT, Raphael Brun/LON/ECT@ECT, Simon Brod/LON/ECT@ECT cc: Peter Styles/LON/ECT@ECT, Nailia Dindarova/LON/ECT@ECT Subject: RE: EdF capacity auctions & other EU news Bruno, Quel surprise. Should make your follow up with the MTF interesting as to the role of the Trustee. One point to note for both MTF and Albers at COMP - the lack of within day flexibility is hardly in keeping with the intention of supporting development of retail supply to end users with fluctuating demand. Suppliers will thus be at the mercy of EdF in the balancing market. In addition, how on earth can they be allowed to take 2 years to complete the process? How does that fit with merger remedy? Somewhat ironic that they have the document in English! Lets discuss what if anyhting we can do after you have spoken with MTF. Regards, Ross -----Original Message----- From: Gaillard, Bruno Sent: 31 May 2001 19:03 To: Philip Davies/LON/ECT@ENRON; Sankey, Ross; de Gaulle, Pierre; Brun, Raphael; Brod, Simon Cc: Styles, Peter; Dindarova, Nailia Subject: RE: EdF capacity auctions & other EU news Obviously a done deal - interestingly the Trustee is not mentioned. EDF has the capacity offering on its web page http://www.edf.fr/htm/en/enchere/enchere and has a detailed document in English but not in French yet. They also has EFET under industry links as well as the CRE, DIGEC. Attached is EDF's presentation of the product. After a quick look, it seems that flexibility is not a option (nomination at noon, and price has not changed) << File: VPP MIP.pdf << Bruno 31/05/01 UK: EDF ISSUES DETAILS OF ITS FIRST CAPACITY AUCTION. LONDON, May 31 (Reuters) - French utility Electricite de France (EdF) announced on Thursday details of its first auction to sell electricity production capacity to competitors. EdF was required by the EU Commission in February to give access to some of its generation capacity as a condition for EU approval of its purchase of a 25 percent stake in German utility EnBW. In the next two years, EdF will auction a total of 6,000 megawatts which include 1,000 MW of peak capacity sold at a price of 26 euros per megawatt hour (MWh) and 4,000 MW of baseload at a price of eight euros/MWh. In addition, 1,000 MW of cogeneration production capacity will be made available. Production from cogeneration plants is bought by EdF from smaller producers under long-term contracts. "With such contracts, electricity suppliers and traders will be able to have electricity without the technical and operational risks of running a power plant," said EdF in a statement. The price for cogeneration capacity will be made public a few weeks before the auction as it depends on gas price movements, EdF said. The auction will take place in several tranches, the first one starting in September, when 200 MW of peak capacity will be auctioned, 800 MW of baseload and 190 MW of cogeneration. The whole 6,000 MW should be sold by October 2003. EdF, which has a 94 percent share of the French generation market, has a total installed capacity of 103,500 MW. -----Original Message----- From: Dindarova, Nailia Sent: 31 May 2001 17:20 To: Gaillard, Bruno; Philip Davies/LON/ECT@ENRON Subject: EdF capacity auctions & other EU news FYI see attached ---------------------- Forwarded by Nailia Dindarova/LON/ECT on 31/05/2001 17:07 --------------------------- << OLE Object: Picture (Device Independent Bitmap) << "Sandra James" <Sandra_James@electricity.org.uk< on 31/05/2001 17:11:51 To: <david.love@british-energy.com<, <rob.plaskitt@british-energy.com<, <shercock@compuserve.com<, <jgreen3@edisonmission.com<, "Gwyn Dolben" <Gwyn_Dolben@electricity.org.uk<, <KHanks@enron.com<, <Nailia.Dindarova@enron.com<, <Peter.Styles@enron.com<, <mwedg90@entergy.com<, <alison.cole@innogy.com<, <DAVID.TOLLEY@innogy.com<, <peter.heffer@magnox.co.uk<, <ALAN.CLARK@natpower.com<, <David.Burnett@nie.co.uk<, <Gordon.Dunlop@nie.co.uk<, <Chris.Price@pgen.com<, <david.densley@scottish-southern.co.uk<, <shamblyn@seeboard.com<, <Brian.Samuel@txu-europe.com<, <Phil.Hardy@txu-europe.com<, <andy.papageorgi@uk.ngrid.com<, <christine.brown@uk.ngrid.com<, <judith.ward@uk.ngrid.com<, <louise.petchell@uk.ngrid.com<, <michael.metcalfe@uk.ngrid.com<, <James.Sheward@uuplc.co.uk<, <Arthur.Probert@yeg.co.uk<, <gail.antrobus@yeg.co.uk<, <Gail.Silcock@yeg.co.uk<, <joanne.bridge@yeg.co.uk< cc: Subject: EdF capacity auctions & other EU news Dear All Please see attached news items from this afternoon, including details of EdF's sale of capacity. Regards Sandra ***************************************************************** This e-mail is confidential. It is intended only for the person named. Unless you are that person, or authorised to receive this e-mail, you must not copy or use it or disclose it to anyone else. If you have received this e-mail in error, please contact the sender. Thank you for your cooperation. Electricity Association Services Limited, 30 Millbank, London SW1P 4RD (Reg. in England No: 2366837). ***************************************************************** - eunews 31may pm.doc << File: eunews 31may pm.doc <<
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