CHAPTER III U.K. RESERVE PRICES

Article 16 U.K. Calculation of reserve prices for standard capacity products for interruptible capacity

1. The reserve prices for standard capacity products for interruptible capacity shall be calculated by multiplying the reserve prices for the respective standard capacity products for firm capacity calculated as set out in Articles 14 or 15, as relevant, by the difference between 100 % and the level of an ex-ante discount calculated as set out in paragraphs 2 and 3.

2. An ex-ante discount shall be calculated in accordance with the following formula:

• Di_ex-ante = Pro × A × 100 %

Where:

• Di_ex-ante is the level of an ex-ante discount;

• Pro factor is the probability of interruption which is set or approved [F1 by the national regulatory authority] pursuant to Article 28, and which refers to the type of standard capacity product for interruptible capacity;

• A is the adjustment factor which is set or approved [F1 by the national regulatory authority] pursuant to Article 28, applied to reflect the estimated economic value of the type of standard capacity product for interruptible capacity, calculated for each, some or all interconnection points, which shall be no less than 1.

3. The Pro factor referred to in paragraph 2 shall be calculated for each, some or all interconnection points per type of standard capacity product for interruptible capacity offered in accordance with the following formula on the basis of forecasted information related to the components of this formula:

• 

Where:

• N is the expectation of the number of interruptions over D;

• D_int is the average duration of the expected interruptions expressed in hours;

• D is the total duration of the respective type of standard capacity product for interruptible capacity expressed in hours;

• CAP_{av. int} is the expected average amount of interrupted capacity for each interruption where such amount is related to the respective type of standard capacity product for interruptible capacity;

• CAP is the total amount of interruptible capacity for the respective type of standard capacity product for interruptible capacity.

4. As an alternative to applying ex-ante discounts in accordance with paragraph 1, the national regulatory authority may decide to apply an ex-post discount, whereby network users are compensated after the actual interruptions incurred. Such ex-post discount may only be used at interconnection points where there was no interruption of capacity due to physical congestion in the preceding gas year.

The ex-post compensation paid for each day on which an interruption occurred shall be equal to three times the reserve price for daily standard capacity products for firm capacity.

Textual Amendments

F1 Words in Art. 16(2) substituted (31.12.2020) by S.I. 2019/531, Sch. 5 para. 5F (as inserted by The Gas Tariffs Code (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/1393), reg. 1(2), Sch. para. 3); 2020 c. 1, Sch. 5 para. 1(1)