OPCOM

Press Release (Bucharest, January 17, 2011)

2005 - 2010, Anniversary Survey: five years of continuous operation of the Day Ahead Market, hourly transactions which increasing continuously from 400 MWh/h in 2005 to nearly 1,000 MWh/h in 2010 covered about 11% of the domestic consumption in the aggregate figures at the level of the analysed time horizon, the level of participation in evolution from 48 in the year of DAM start-up to 81 in 2010; five years of operation of the Centralized Market for Bilateral Contracts, transactions that covered, in accordance to the sum up amounts of electricity contracted for delivery in 2006-2010, about 12% of the real domestic consumption in the same period; five years of operation of the Green Certificates Market in Romania, centralized transactions which provided each year the majority share in fulfilling the annual mandatory quota of green certificates.

The Day Ahead Market

The 72 participants active on the DAM platform in the last month of 2010 have contributed not only to trade the time record monthly volume of electricity, an average of 1,181.525 MWh/h, but also to maintain the trend of continuously increasing quantities traded annually since 2005, the start-up year of the New Platform for the Day Ahead Market. The annual averages indicate more than a doubling of the traded volume, from 388.927 MWh/h in 2005 to 992.716 MWh/h in 2010, the most significant variation, 37%, resulting from the comparative analysis of the last two years, when the annual average shows a gain of almost 270 MWh/h. This quantitative leap is also reflected in the spot market share of the domestic consumption, which increased by almost four percentage points in 2010, evolving from 12.67% in 2009 to 16.56% in the last year.

Over the entire year, the number of participants who submitted at least one bid in 2010 was 81, representing about 76% out of the 106 companies registered to the market. The intentions expressed by the active participants materialized in 2010 in hourly transactions that have varied in a range between 266 MWh/h and 1,591 MWh/h, the upper limit representing an absolute maximum of the entire time horizon 2005-2010. Settled in all hourly intervals without exceptions, the hourly transactions amounted at least 600 MWh/h in most intervals (97% of cases), equivalent to about 10% of annual average hourly consumption, while the transactions volume was lower than 500 MWh/h in only 1% out of the 8,760 hourly intervals.

The annual trading price in 2010 was 153.39 lei/MWh (36.44 EUR/MWh), while the weighted average price was 156.31 lei/MWh (37.08 EUR/MWh) almost the same as the value of last year, when the weighted average was 155.35 lei/MWh (36.69 EUR/MWh).

At European level, the annual average prices corresponding to hourly electricity transactions set in spot markets based on similar mechanisms recorded mostly growth, being placed in 2010 in a range between 36 EUR/MWh and 65 EUR/MWh, the average price set by OPCOM, 36.44 EUR/MWh, at the lowest limit of the range this year as well, being at a distance of 22% below the European average, about 47 EUR/MWh.

The Centralized Market for Bilateral Contracts concluded by public auction

In 2010, the participants have consistently expressed their interest by initiating bids, the number of intentions expressed by the 28 active participants out of the 102 registered being close to the value set last year, respectively 171 bids compared to 180 in 2009.

With a traded quantity of 3.9 TWh compared to 4.8 TWh in the previous year, 2010 ensures deliveries of 3.6 TWh in 2011, representing a market share of 6.85% out of the consumption, an encouraging start in trading bilateral contracts on CMBC throughout 2011.

The contracted deliveries for 2010 amounted a market share of 7.82% out of the consumption, the corresponding weighted average price, 153.96 lei/MWh (36.52 EUR/MWh), very close to the annual weighted average spot price in 2010, 156.31 lei/MWh (37.08 EUR/MWh), demonstrating again the convergence of the two price signals.

As in the previous year, the results reflect the economic conditions, including the existence of a high degree of uncertainty regarding the present and future evolution of the consumption, a determining factor for a certain percentage of the market to shift towards short-term commitments undertaken by participating on the spot market.

The Centralized Market for Bilateral Contracts with continuous negotiation

The 110 standard contracts concluded based on the electricity transactions on the CMBC-CN electronic platform, respectively 90 standard base weekly contracts and 20 standard off-peak weekly contracts, totalize 16,240 MWh, respectively a share of 0.03% out of the electricity consumption for the year 2010.

The Centralized Market for Green Certificates

A number of 248,694 green certificates were traded centralized during 2010, out of which 66,371 certificates were purchased by suppliers in order to meet the mandatory quota for 2009, the remaining of 182,323 green certificates contributing to meet the mandatory quota for 2010 and representing, so far, the equivalent of 33.46% of certificates issued for 2010 until the last month of the year. The average trading price of green certificates traded to meet the mandatory quota for 2010 was 232.36 lei/certificate (55 EUR/certificate at the average exchange rate for December 2009, 4.2248 lei).

The Settlement

On the Day Ahead Market, the total collection rights and payment obligations related to transactions amounted in 2010, including VAT, 1,655.6 million lei (392.6 million euro), out of which the payments always done in two banking days totalized 1,571.8 million lei (372.8 million euro), the difference representing the amount of compensation between the participants and the central counterparty.

In addition to the successful accomplishment of all responsibilities that have resulted from the role of counterparty on the spot market assumed by OPCOM, the settlement activity also involved, in 2010, fulfilling the responsibilities derived from the process of assigning the quantities, respectively the collection rights/payment obligations for:
• the trades concluded on the Green Certificates Market of 56.7 million lei (13.7 million euro), corresponding to green certificates traded in 2010 to meet the mandatory quota for 2009 and 2010;
• the trades on the balancing market administered by Transelectrica amounting 306.12 million lei for upward regulation and, respectively, 60.67 million lei for downward regulation (during January-November 2010);
• the imbalances of the balance responsible parties of 65.90 million lei corresponding to positive imbalances and, respectively, 333.62 million lei corresponding to negative imbalances, as well as, settlement of information imbalances of the dispatchable units of 164,208 lei (during January-November 2010).

The residual costs or income resulting from the system balancing have been determined and redistributed.

The quantities contracted for delivery in 2010 on OPCOM markets, respectively on the spot market and centralized markets for bilateral contracts, totalized an amount of electricity of 12,800,681 MWh, the equivalent to about 25% of the estimated consumption for this year.

In addition to the electricity transactions, a number of 248,694 green certificates were traded centralized within 12 monthly auctions held in 2010.

These are the results by which the OPCOM markets ended the year 2010, but we must not forget the milestone of June 1st, the start-up of the Trading Platform for Emission Certificates (TPEC), as well as the systematic increase of the participants interest towards this platform, progress reflected in auctions scheduled in 2010, as well as the growing number of the registered participants, both brokers and operators of installations which generate emissions and pollution.