Demand Assessment Report for Incremental Capacity Between Bulgaria and Greece

Demand assessment report for incremental capacity between Bulgaria and Greece

2019-10-21

This report is a joint assessment of the potential for incremental capacity projects conducted by:

BULGARTRANSGAZ EAD DESFA S.A.

66 Pancho Vladigerov Blvd. 357-359 Messogion Ave., Halandri, Lyulin 2, P.O. Box 3 15231 Greece 1336 Sofia, Bulgaria Telephone: + 359 /2/ 939 63 00 Telephone: +30 2130884000 Fax: + 359 /2/ 925 00 63 Fax: +30 2130884062 Email: [email protected] Email: [email protected] [email protected]

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Table of contents

A. Non-binding Demand indications 4 B. Demand assessment 5 i. Historical usage pattern 5 ii. Results of current annual yearly auction 8 iii. Expected amount, direction and duration of demand for incremental capacity 98 C. Conclusion for the (non)-initiation of an incremental capacity project/process 1110 D. Fees 11 E. Contact information 12

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A. Non-binding Demand indications

Currently Bulgaria and Greece have one interconnection point (IP) – Kulata/Sidirokastro connecting Bulgartransgaz EAD (BG) gas transmission network for transit transmission and the gas transmission system operated by DESFA (GR), located on the Bulgarian- Greek border in the area of Kulata/Sidirokastro.

Historically this interconnection entry-exit point (IP) Кulata/Sidirokastro serves mainly as an entry point enabling Greece to receive natural gas, i.e. the physical flow is more often in the direction from Bulgaria to Greece. During the January 2009 crisis, physical reverse flow to Bulgaria was carried out through this interconnection. As a result of version 1 and version 2 of the Interconnection Agreement (IA) for IP Kulata/Sidirokastro signed between Bulgartransgaz EAD and DESFA S.A., an alternative possibility has been provided for natural gas import in Bulgaria through reverse flow supplies on commercial basis e.g. backhaul (version 1) and physical reverse transmission in reverse direction (version 2), through the reverse connection of the modernized CS Petrich. As of 1 April 2019 the reverse flow capacity has been increased to 46 535 MWh/d, and in addition a capacity on interruptible basis is available.

The involved TSOs, Bulgartransgaz EAD (BG) and DESFA S.A. (GR) have received, within the 2019 Incremental Capacity process, one non-binding demand indication for firm capacity at the interconnection points between the entry-exit system of Bulgartransgaz EAD and the entry-exit system of DESFA S.A. for the period 2019/2020 – 2023/2024.

The following periods have been included in this analysis: a) non-binding demand indications received within 8 weeks after the start of the annual yearly capacity auction on 1 July 2019 in accordance with REGULATION EC 459/2017.

One demand indication1 by a network user for the period 2019/2020 – 2023/2024.

1 The demand indication has been received by DESFA S.A. within the 8 weeks period after the start of the annual yearly auction. Due to a technical issue the same demand indication has been sent by the network user and received by Bulgartransgaz EAD later than 8 weeks after the start of the annual yearly auction. In line with paragraphs 6 and 7 of Article 26 of COMMISSION REG- ULATION (EU) 2017/459 the operators took the common decision to consider this non-binding demand indication in the ongoing market demand assessment.

DAR 2019 IP Kulata / Sidirokastron Page 4 of 12 b) non-binding demand indications received later than 8 weeks after the start of the annual yearly capacity auction on 1 July 2019, which would have been considered in the current incremental capacity cycle.

As per item A. a) above, one (1) non-binding demand indication for the period 2019/2020 – 2023/2024, which has been used as a basis for this demand assessment:

Non-Binding Incremental Capacity Demand Survey 2019 according to Regulatory (EU) 2017/459 Interconnection Point Kulata/Sidirokastro EIC Code 21Z000000000020C Flow Direction GRBG Request is submitted to other TSOs [yes, TSO name] or [no] Yes, BTG and DESFA Additional Information (if any) Conditions*[please indicate the letter(s) a) to c) and describe

the conditions in more detail below] Current technical capacity, kWh/d 46 535 000 2019/2020 14 452 054 2020/2021 14 452 054 2021/2022 14 452 054 2022/2023 14 452 054 2023/2024 14 452 054

B. Demand assessment

i. Historical usage pattern The utilisation of the technical capacity is presented in the chart below by comparing the technical capacity with the booked capacity, the allocated “commercial” flow and the physical flow for the past 2 years at the concerned interconnection point. i.1. Transparency Platform data: According to ENTSOG Guidelines included in the DAR Template, operational TP data is used for the following Graphs:

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Graph 1: IP Kulata/Sidirokastro exit Bulgaria [kWh/d]

140000000

120000000

100000000

80000000

60000000

40000000

20000000

0 01/1/2018 01/2/2018 01/3/2018 01/4/2018 01/5/2018 01/6/2018 01/7/2018 01/8/2018 01/9/2018 01/1/2019 01/2/2019 01/3/2019 01/4/2019 01/5/2019 01/6/2019 01/7/2019 01/8/2019 01/9/2019 01/10/2017 01/11/2017 01/12/2017 01/10/2018 01/11/2018 01/12/2018 Exit Technical kWh/d Exit Firm Booked kWh/d Exit Interruptible Booked kWh/d Exit Nominations kWh/d Exit Phisical flow kWh/d

Graph 2: IP Kulata/Sidirokastro entry Greece [kWh/d]

140.000.000

120.000.000

100.000.000

80.000.000

60.000.000

40.000.000

20.000.000

0 1/1/2018 1/2/2018 1/3/2018 1/4/2018 1/5/2018 1/6/2018 1/7/2018 1/8/2018 1/9/2018 1/1/2019 1/2/2019 1/3/2019 1/4/2019 1/5/2019 1/6/2019 1/7/2019 1/8/2019 1/9/2019 1/10/2017 1/11/2017 1/12/2017 1/10/2018 1/11/2018 1/12/2018

Firm Booked Firm Technical Interruptible Booked

Physical Flow Nomination

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Graph 3: IP Kulata/Sidirokastro exit Greece [kWh/d]

60.000.000

50.000.000

40.000.000

30.000.000

20.000.000

10.000.000

Firm Booked Firm Technical Interruptible Booked Physical Flow Nomination

Graph 4: IP Kulata/Sidirokastro entry Bulgaria [kWh/d]

60000000

50000000

40000000

30000000

20000000

10000000

0 01/1/2018 01/2/2018 01/3/2018 01/4/2018 01/5/2018 01/6/2018 01/7/2018 01/8/2018 01/9/2018 01/1/2019 01/2/2019 01/3/2019 01/4/2019 01/5/2019 01/6/2019 01/7/2019 01/8/2019 01/9/2019 01/10/2017 01/11/2017 01/12/2017 01/10/2018 01/11/2018 01/12/2018 Entry Technical kWh/d Entry Firm Booked kWh/d Entry Interruptible Booked kWh/d Entry Nominations kWh/d Entry Phisical flow kWh/d

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ii. Results of current annual yearly auction

In the recent annual yearly firm capacity auction taking place on 01.07.2019 for the joint IP Kulata/Sidirokastro the following results have been achieved:

ii. 1. Bulgartransgaz results of current annual yearly auction - bundled firm capacity yearly auction from Greece to Bulgaria and from Bulgaria to Greece

Intercon- Offered Booked Flow Capacity nection Interconnection Gas year capacity capacity direc- type point point EIC Amount, Amount, tion name kWh/d kWh/d Kulata/ Exit GR 21Z000000000020C 2019/2020 41 881 500 0 Firm Sidirokastro Entry BG Kulata/ Exit BG 21Z000000000020C 2019/2020 0 0 Firm Sidirokastro Entry GR

In the recent Bulgartransgaz EAD annual yearly interruptible capacity auction taking place on 15.07.2019 for the joint IP Kulata/Sidirokastro the following results have been achieved:

ii. 2. Bulgartransgaz results of annual unbundled interruptible capacity yearly auction from Bulgaria to Greece and from Greece to Bulgaria

Offered Booked Intercon- Flow Capacity Interconnection capacity capacity nection direc- Gas year type point EIC Amount Amount point name tion kWh/d kWh/d Kulata/ Exit BG 21Z000000000020C 2019/2020 0 0 Interruptible Sidirokastro Entry GR Kulata/ Exit GR 21Z000000000020C 2019/2020 0 0 Interruptible Sidirokastro Entry BG

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In the recent DESFA S.A. annual yearly firm capacity auction that took place on 01.07.2019 for the joint IP Kulata/Sidirokastro the following results have been achieved:

ii. 3. DESFA results of current annual unbundled firm capacity yearly auction from Bulgaria to Greece

Intercon- Offered Booked nection Interconnection Flow di- Gas year capacity capacity Capacity Point point EIC rection Amount, Amount, type name kWh/d kWh/d Kulata/ Exit BG 21Z000000000020C 2019/2020 7.722.000 6.615.000 Firm Sidirokastro Entry GR

ii. 4. DESFA results of current annual yearly auction - bundled firm capacity yearly auction from Greece to Bulgaria

Intercon- Offered Booked nection Interconnection Flow di- Gas year capacity capacity Capacity Point point EIC rection Amount, Amount, type name kWh/d kWh/d Kulata/ Exit GR 21Z000000000020C 2019/2020 41.881.500 0 Firm Sidirokastro Entry BG

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iii. Expected amount, direction and duration of demand for incremental capacity

The expected demand level for incremental capacity at the interconnection points between the entry-exit system of Bulgartransgaz EAD and the entry-exit system of DESFA S.A. for the future period is in the direction from Greece to Bulgaria and amounts to 14 452 054 kWh/d, as presented in chapter 0A.

IP Kulata/Sidirokastro GR>BG with forecast for yearly capacity

50,00

40,00

30,00 Technical Incremental Gwh/d 20,00 Booked yearly 10,00

0,00

The historical usage of the concerned interconnection point as well as the available capacity on firm or interruptible basis (i.e. technical and / or interruptible capacity which is not yet booked in the long term) for the requested period shows that the existing capacity is currently sufficient to cover the need indicated for incremental capacity in the period before the start of the next Incremental process (i.e. 2021), taking into account the demand indicators received and also the possibility to use CMP procedures if needed.

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C. Conclusion for the (non)-initiation of an incremental capacity project/process

The assessment result of the non-binding demand indications and the historical usage patterns indicated that no demand levels for incremental capacity need to be devel- oped, therefore no incremental capacity project will be initiated, resulting from the current demand assessment procedure.

Based on the aforementioned decision, no technical studies for incremental capacity projects will be conducted.

D. Fees

Neither Bulgartransgaz EAD, nor DESFA S.A. introduced a fee for the evaluation and pro- cessing of non-binding demand indications.

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E. Contact information

BULGARTRANSGAZ EAD DESFA SA Nikola Delev Dimitrios Douvikas Analyses Dept. Head of Regulations Department Joseph Florentin Head of Business Development Dept. Analyses and International Activities Division Telephone: Telephone: +359 2 9396208, +30 213 0884076, +359 2 9396674 +30 213 0884066 Fax: Fax: Email: [email protected] Email: [email protected] [email protected] [email protected]

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