News / The Energy Authority has confirmed the updated terms and conditions of balance management, which will be applied from 1 September 2020

The Energy Authority has confirmed the updated terms and conditions of balance management, which will be applied from 1 September 2020

The Energy Authority has confirmed the updated terms and conditions of the balance management, which will enter into force on September 1, 2020. The main changes concern the principles for determining imbalance charges and the cost neutrality of balance management activities.

According to gas market legislation, balance management activity of Transmission System Operator (TSO) must be cost neutral. Gasgrid Finland may not gain profit or incur costs from balance activities. To ensure cost neutrality, the surplus revenue is returned to the market and the deficit incurred is collected from the market. This is done through a neutralization fee, which Gasgrid determines on a monthly basis based on the costs and revenues generated by the balance management activities.

With regard to imbalance charges, the main changes concern the adjustment applied to the imbalance gas pricing. The principles applicable until the end of August includes two adjustment steps: a big adjustment (3 %) and a small adjustment (0,5 %). However, this has not sufficiently incentivized balance responsible parties to stay in balance. In addition, the model has been perceived as relatively complex. Due to these factors, instead of two adjustments, only one adjustment of 10 % will be applied from the beginning of September.

You can find the terms and conditions of the balance management here: https://gasgrid.fi/wp-content/uploads/Terms-and-conditions-of-balance-management-2.0-unofficial-english-translation.pdf.

Gasgrid Finland Oy is a Finnish state-owned company and transmission system operator with system responsibility. We offer our customers safe, reliable and cost-efficient transmission of gases. We actively develop our transmission platform, services and the gas market in a customer-oriented manner to promote the carbon-neutral energy and raw material system of the future. Find out more: www.gasgrid.fi/

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