ACER Mission Structure and Activities Alberto Pototschnig Director

ACER: Mission, Structure and Activities Alberto Pototschnig Director E-Control Energy Dialogue TITRE Vienna, 7 December 2011

. . . Outline ACER Establishment Mission and Internal Governance Main Tasks 2011 Activities 2012 Work Programme

. . ACER Establishment ACER has been established as part of the new institutional framework of the Internal Energy Market defined by the Third Package September 2010 1 February 2011 3 March 2011 Set-up in Brussels Moved to Ljubljana Official Opening

ACER Official Opening

. . . Outline ACER Establishment Mission and Internal Governance Main Tasks 2011 Activities 2012 Work Programme

ACER Mission (Regulation (EC) No 713/2009) “The purpose of the Agency shall be to assist the [NRAs] in exercising, at Community level, the regulatory tasks performed in the Member States and, where necessary, to coordinate their action”. Article 1(2) Therefore, ACER is NOT a European Energy Regulator … but plays a CENTRAL ROLE in the new institutional framework introduced by the 3 rd Legislative Package on Energy . .

ACER – Relevant EU Legislation ACER Third Energy Package Directives 2009/72/EC and 2009/73/EC and Regulations (EC) Nos 713/2009, 714/2009 and 715/2009 Regulation (EU) No 838/2010 (on the Inter-TSO Compensation Mechanism) Regulation on Wholesale Energy Market Integrity and Transparency (REMIT) (adopted by the European Council on 10 October 2011) Proposed Regulation on guidelines for trans-European energy infrastructure (tabled by the European Commission on 19 October 2011; expected to enter into force by end-2011)

ACER Bodies . . Administrative Board of Regulators Board of Appeal Director

. . . The Administrative Board (1) is composed of 9 members and 9 alternates: » » 2 + 2 appointed by the European Parliament 5 + 5 appointed by the European Council 2 + 2 appointed by the European Commission the Chairman of the Board of Regulators and the Director as non-voting observers ensures that ACER carries out its mission and performs the tasks assigned to it in accordance with Regulation (EC) No. 713/2009 formally appoints the members of the Board of Regulators appoints the members of the Board of Appeal formally appoints the Director upon a favourable opinion by the Board of Regulators exercises, in consultation with the Board of Regulators, disciplinary authority over the Director

The Administrative Board (2) . . . adopts ACER’s Work Programme (by 30 September each year, after consulting the Commission and after having received approval by the Board of Regulators) and transmits it to the European Parliament, the Council and the Commission adopts and, if necessary, revises a Multi-annual Programme draws up the ACER’s implementing rules for giving effect to the Staff Regulations

The Administrative Board (3) Piotr Grzegorz Wozniak, Poland Chair Razvan Nicolescu, Romania Vice-Chair Appointed by the European Parliament Appointed by the European Council Appointed by the European Commission

. . The Board of Regulators (1) comprises: » » one senior representative and one alternate per Member State from the current senior staff of NRAs one non-voting representative of the Commission provides Opinions to the Director on ACER’s opinions, recommendations and decisions that are considered for adoption provides Guidance, within its field of competence, to the Director in the execution of his tasks approves the Work Programme of the Agency for the coming year and present it by 1 September of each year for adoption by the Administrative Board

The Board of Regulators (2) Lord Mogg, UK Chair Walter Boltz, Austria Vice-Chair

. The Board of Appeal (1) comprises: » » . 6 members and 6 alternates selected from among current or former senior staff of the national regulatory authorities, competition authorities or other national or EU institutions with relevant experience in the energy sector considers appeals lodged by any natural or legal person, including NRAs, against a decision by ACER ex art. 7, 8 and 9 of Reg. 713/2009: » » which is addressed to that person, or which, although in the form of a decision addressed to another person, is of direct and individual concern to that person

The Board of Appeal (2) Pippo Ranci Ortigosa, Italy Chair Herbert Ungerer, Germany Vice-Chair

. . . The Director represents and manages the Agency implements the Work Programme adopts and publishes opinions, recommendations and decisions that have received the favourable opinion of the Board of Regulators prepares the draft Work Programme, the draft Budget and the draft Annual Report of the Agency recruits and appoints staff of the Agency

ACER Internal Structure (Director + 51 staff members) Internal Audit Director Legal Adviser Electricity Department NRA Coordination Press and Communication Gas Department Administration Department Framework Guidelines Budget and Finance Market Monitoring Human Resources NRA Cooperation TSO Cooperation IT Resources and Document Management

. . . Outline ACER Establishment Mission and Internal Governance Main Tasks 2011 Activities 2012 Work Programme

ACER’s Current Activities (1) Types of acts which ACER can adopt TSOs NRAs Opinions and recommendations European Parliament European Council European Commission Individual decisions in specific cases (residual power)

ACER’s Current Activities (2) ACER Opinions on the 10 -Year EU-wide Network Development Plans Framework Guidelines for Network Codes NRA Support and Coordination Decisions on Terms and Conditions for Access to/Operational Security of Cross-border Infrastructure Decisions on Exemptions Regional Coordination Market Monitoring Access (incl. RES), Retail Prices and Consumers’ Rights Wholesale Trading (REMIT)

FG and NC Characteristics Framework Guidelines (FG) Network Codes (NC) No clear definitions in the Third Package Based on the annual priorities set by the Commission Non-binding Are made legally binding via Comitology Setting clear and objective principles for the network codes Must be in line with FG Shall contribute to non. Provide effective access to the TSO discrimination, effective competition networks across borders; promote and the efficient functioning of the cooperation & coordination among market TSOs; allow for national network rules and regional specificities

Areas for FG and NC Framework Guidelines N e t w o r k C o d e s (a) network security and reliability rules entso (b) network connection rules (c) third-party access rules (d) data exchange and settlement rules (e) interoperability rules (f) operational procedures in an emergency (g) capacity-allocation and congestion-management rules (h) rules for trading related to technical and operational provision of network access services and system balancing (i) transparency rules (j) balancing rules (k) rules regarding harmonised transmission tariff structures (l) energy efficiency regarding electricity networks.

FG and NC: Basic Timeline Priority areas defined by the European Commission EC invites ACER to develop FG EC invites ENTSO to develop NC ENSTO submits the NC to ACER for evaluation ACER recommends NC to EC for adoption entso Scoping FG NC 6 months 12 months EV 3 m Comitology

ACER Support to NRAs Promotion of Cooperation (even beyond the areas of ACER remit) Sharing of Best Practices Interpretation of Guidelines Promotion of Cooperation (even beyond the areas of ACER remit) Peer Review Specific Decisions

ACER Individual Decisions for cross-border infrastructure Decisions on Terms and Conditions for Access to and Operational Security of Cross-border Infrastructure Decisions on TPA/Unbundling Exemptions ACER decides if: ● The concerned NRAs fail to reach an agreement, or ● Jointly requested by the concerned NRAs

. . . Outline ACER Establishment Mission and Internal Governance Main Tasks 2011 Activities 2012 Work Programme

Recent activities: Electricity Sector Mar Apr May Jun Jul Aug Sep Oct 2011 2012 Nov Dec Jan Feb Mar FG on Grid Connections PUBLIC 3 Mar CONSULT. 2 May 20 Jul Opinion on ENTSO-E Statutes, List of Members and Rules of Procedure T. C. 5 Apr 5 May FG on Capacity Allocation and Congestion Management in Electricity 11 Apr PUBLIC CONSULT. 10 Jun 29 Jul FG on System Operations 15 Jul PUBLIC 15 Sep CONSULT. 2 Dec FG on Balancing SCOPING Opinion on ENTSO-E 2012 Work Programme 2 Dec

Recent activities: Gas Sector Mar Apr May Jun Jul Aug Sep Oct 2011 2012 Nov Dec Jan Feb Mar FG on Capacity Allocation Mechanisms for the European Gas Transmission Network PUBLIC 3 Mar CONSULT. 2 May 3 Aug Opinion on ENTSO-G Statutes, List of Members and Rules of Procedure T. C. 5 Apr 5 May FG on Gas Balancing in Transmission Systems PUBLIC 12 Apr CONSULT. 12 Jun 18 Oct Opinion on ENTSO-G EU-wide Ten-Year Development Plan 16 Sept FG on Interoperability Rules SCOPING FG on Rules regarding Harmonised Transmission Tariff Structures SCOPING

. . . Outline ACER Establishment Mission and Internal Governance Main Tasks 2011 Activities 2012 Work Programme

ACER 2012 Work Programme (1) Areas of Activity Framework Guidelines Planned Activities Electricity -Balancing (*) -Third Party Access Gas -Interoperability (*) -Harmonised Tariff Structure (*) -Data Exchange and Settlement Rules -Rules for Trading Reasoned Opinion on Network Codes Electricity -Grid Connections -Capacity Allocation and Congestion Management (Capacity Calculation, Dayahead and Intraday) Gas -Capacity Allocation Mechanisms -Balancing

ACER 2012 Work Programme (2) Areas of Activity Planned Activities ITC Mechanism (Electricity) - Annual Report on implementation and management of the ITC Fund - Proposal to the Commission on the annual cross-border infrastructure compensation sum Monitoring - Internal Energy Market (Annual Report) - Regional Initiatives (Annual Status Review)

ACER 2012 Work Programme (3) Opinion on ENTSO-E’s EU-wide Ten-Year Network Development Plan Opinion on ENTSOs’ Work Programmes

REMIT: a new challenge Sector-specific, comprehensive monitoring framework for wholesale energy markets to detect and deter market abuse To promote confidence of consumers and other market participants in the integrity of electricity and gas markets ACER “is best placed to carry out such monitoring as it has both a Union-wide view of electricity and gas markets, and the necessary expertise in the operation of electricity and gas markets and systems in the Union” (recital 17) Close cooperation and coordination between ACER and NRAs

. . . REMIT at a glance Registration of Wholesale Energy Markets (WEM): participants with NRAs Rules prohibiting abusive practices affecting WEM: » Trading based on inside information (obligation to publish inside information) » Market manipulation – actual or attempted Definition of inside information, market manipulation and attempt to manipulate markets (updated by the Commission through “Delegated Acts”) Monitoring of WEM by ACER in cooperation with NRAs Power of Investigation rests with NRAs Enforcement of Prohibitions by NRAs

Time line of REMIT’s implementation REMIT’s entry into force 20 days after publication in the OJ • Prohibitions of insider dealing and market manipulation apply for market participants • Obligation to publish inside information applies for market participants ACER, in cooperation with NRAs, determines and publishes data format for registration of market participants 6 months Implementing acts’ entry into force (after comitology procedure) ? 3 months Registration of energy trading firms applies 6 months 18 months Winter 2011 Spring Summer 2011 2012 ? Data collection and monitoring by ACER and NRAs NRA competences implemented into national law ? ? Summer Autumn Winter 2013/2014

. . . . Immediate obligations to notify (1) Market participants are immediately subject to: Obligation to publish inside information (art. 4) Obligation to notify ACER and competent NRAs in case of delayed publication of inside information (art. 3(4)(b) and 4(2)) Prohibition of market abuse (art. 3 and 5) Trading on inside information Market manipulation Attempted market manipulation

. . Immediate obligations to notify (2) Persons professionally arranging transactions are immediately subject to: Obligation to establish effective arrangements to identify breaches (art. 15(2)) Obligation to notify NRAs – and NRAs to notify ACER where needed – in case of reasonable suspicion of breach (art. 15(1)) ACER to develop web forms for supporting in a secure and uniform way the two immediate obligations for notifications

. . Non-binding Guidance (1) Describes ACER’s understanding of the market abuse definitions of Art. 2 of REMIT Does not provide legal interpretation Addressed to NRAs with a view to establishing a common understanding on REMIT definitions (Art. 16) Published for ensuring the maximum transparency

. . Non-binding Guidance (2) A first edition of Guidance to be published by end of December ACER will update and publish further editions of guidance in due course (on a yearly basis) according to ACER’s, NRAs’ and market participants’ experience

Thank you for your attention! Thank you for your attention www. acer. europa. eu