Baltic Energy Market Interconnection Plan BEMIP

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Baltic Energy Market Interconnection Plan (BEMIP)
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The three pillars of EU energy policy

• Europe has agreed a forward-looking political
  agenda to achieve its core energy objectives of
  sustainability, competitiveness and security of
  supply.

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Strategic Energy Review

• Target of 20-20-20 by 2020
• Reduction in greenhouse gas emissions to 20
  below 1990 levels, 30 in the context of a
  global
• agreement on climate 20 contribution of
  renewables to final energy consumption
• reduction in primary energy use to 20 below the
  baseline projection for 2020.

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Towards single internal market
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2nd Strategic Energy Review - Infrastructure
priorities

• Effective interconnection of the Baltic Sea
  region was identified as one of the six priority
  energy infrastructure projects in the Second
  Strategic Energy Review adopted by the Commission
  in November 2008.

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BEMIP start up and goals

• The Baltic Energy Market Interconnection Plan was
  launched at the initiative of Commission
  President Barroso at the 2008 autumn European
  Council.
• The two main goals of the BEMIP initiative,
  within the context of the EU's 20/20/20
  objectives are
• the full integration of the three Baltic States
  into the European energy market, through
• the strengthening of interconnections with their
  EU neighboring countries.

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Creation of the BEMIP (Action plan)

• A High Level Group has been set up with the
  participation of Denmark, Estonia, Finland,
  Germany, Latvia, Lithuania, Poland, Sweden and,
  as an observer Norway.
• The Group, chaired by the Commission, started to
  meet in November 2008. Three working groups
  deemed necessary for the development of the Plan
  on the following topics
• "Internal Market of electricity
• "Electricity Interconnections and power
  generation
• "Gas internal market and infrastructure"

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The main conclusions of the BEMIP High Level
Group final report

• BEMIP (Action Plan) covers the following 3 areas
• Electricity market integration
• The Electricity market design - based on the
  Nordic electricity market model
• A specific "Roadmap" that describes practical
  steps on how to reach the new market model and
  aims at removing the barriers for a regional
  electricity market in the Baltic States in
  conformity with the EU internal electricity
  market
• Electricity interconnections and generation
• The infrastructure projects allowing the
  integration of the Baltic Sea Region electricity
  markets are identified and have been assessed.
  There are three sets of projects
• The Nordic Master Plan covers the projects
  between the Nordic countries such as Fenno - Skan
  II linking Finland and Sweden, Great Belt in
  Denmark, Nea - Järpströmmen between Sweden and
  Norway, South Link in Sweden and Skagerrak IV
  between Denmark and Norway and others.
• Regarding the projects linking the Baltic area
  with the Nordic countries, as well as Poland, all
  identified interconnections NordBalt or the
  previously called SwedLit linking Sweden to
  Lithuania, Estlink 2 between Estonia and
  Finland and LitPol between Poland and Lithuania -
  are commercially viable. Strengthening the
  electricity grid between the three Baltic States
  belongs to this set of projects.
• The interconnections between Poland and Germany
  form the third set of projects. The main driver
  behind these as opposed to market integration
  which is the case for the previous ones - is the
  loopflows caused by wind generation in the North.
  Initiatives launched by the European Coordinators
  Mr Adamowitsch with the so called 'heptalateral'
  Central Eastern Forum and Prof Mielczarski cover
  these projects.
• Gas internal market and infrastructure
• For infrastructure, the main driver is enhancing
  security of supply by aiming at a higher level of
  diversification of routes and sources. There is a
  good view on the potential projects that could
  satisfy this objective, which includes
  interconnections - new or implementation of
  reverse flow, LNG facilities as well as
  development of gas storages. It was agreed by the
  HLG to further develop the BEMIP gas sector
  aspects.

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BEMIP (Action plan)

• Action plan delivered
• Joint declaration of the three Baltic States'
  Prime Ministers signed in Vilnius on April 27,
  2009 confirmed their political commitment to
  pursue real market opening and integration in
  electricity sector
• Memorandum of Understanding on the Baltic Energy
  Market Interconnection Plan signed by 9 parties
  on June 17,2009.

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Vision and Baltic Market design, 2015

• Vision
• Creation of Pan-Baltic single harmonized
  electricity market integrated with Nordic market
  and further on also with Central and Eastern
  European markets. Baltic market integrated into
  Nordic market through Nord Pool and Baltic Nordic
  interconnections infrastructure during 2009-2015.
• Future market design at the common Baltic
  electricity
• Nord Pool Spot Baltic with three bidding areas
• Implicit auction between Baltic countries and
  towards Nordic Countries
• Transparency according to the ERGEG's North
  European Electricity Regional Initiative
• Harmonized imbalance settlement and imbalance
  pricing
• Common reserves and balancing power market
• Harmonized network tariffs for generators -
  structure and level
• Estonia, Latvia, Lithuania and Finland have a
  common position and trading principles towards
  non EEA third countries
• Baltic retail market
• Market place financial trade
• Target Baltic market design is consistent with
  the key elements of the Nordic market design

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Roadmap towards an integrated power market (Step
1)
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Roadmap towards an integrated power market (Step
2)
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Roadmap towards an integrated power market (Step
3)
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Roadmap towards an integrated power market (Step
4)
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Final remarks

• Monitoring of the implementation of the BEMIP has
  been contributed to the Commission first
  progress report will be presented to the High
  Level Group in December 2009.

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Thank you for your attention!