16.04.2022 18:51
The unified methodology for determining the balance service price (30.12.2019 nr 7-10/2019-013)
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172372 KBA balance responsible party can be any entity who has signed a Balance Agreement with Elering to secure its own balance according to the Electricity Market Act and related legislation.
By signing a Balance Agreement the TSO undertakes to sell to the balance responsible party any amounts of electricity that are missing in its balance area in an imbalance settlement period, and to buy any excess electricity from the balance responsible party.
The balance responsible party is responsible for the balance of the market participants in its open supply chain. It is the balance responsible party’s responsibility to ensure that the amounts of electricity bought from or put into the grid by market participants in its balance area and the amounts of electricity sold or taken out of the grid in the same imbalance settlement period are in balance.
If the balance responsible party is not in balance, it must immediately on the first request of the TSO show how balance will be restored. On the TSO's demand, the balance responsible party has to take immediate actions to return to balance. The balance responsible party must use communication systems that allow the TSO to contact them at any time of day or night.
Elering’s standard terms and conditions of the Balance Agreement, as approved by the Competition Authority, are appended to the Balance Agreement.
The standard terms for the Balance Agreement define clearly:
- the rules for balance planning, intra-day balance corrections, and imbalance settlement;
- the rights and obligations of the TSO and the balance responsible party,
- guarantees.
With the decision nr 7-10/2024-022 (04.10.2024) the Estonian Competition Authority has approved Elering’s new electricity standard terms and conditions. Elering shall apply the new standard terms and conditions starting from 09.10.2024.
The standard terms and conditions could be found attached below.
The System Operator shall apply a mechanism for covering administrative costs based on national legislation and the methodology approved by the Competition Authority. The System Operator uses the administrative cost component to cover the administrative costs arising from rendering balance service, the amount of which is forecasted for the financial year.
The methodology for administrative cost components starting from 01.01.2021 is as follows:
1. The System Operator shall apply balance service administrative cost tariffs on the imbalance volume and on the production and consumption volumes within a balance area.
2. The imbalance tariff (€/MWH) shall be applied for each imbalance settlement period on the absolute value of the balance responsible party’s imbalance volume. The production and consumption tariff (€/MWh) shall be applied for each accounting period on the sum of production and consumption volumes in the balance responsible party’s balance area, the volumes of which are calculated based on the imbalance settlement metering point measurement data with kWh precision (incl. network losses).
3. The imbalance price shall be the same in one imbalance settlement period for both sold and purchased imbalance direction.
4. The total cost for balance service is the sum of imbalance cost and administrative costs.
The balance service administrative cost components are the following:
| Administrative cost components | Value until 31.05.2023 | Value from 01.06.2023 |
| Imbalance tariff €/MWh | 0,60 | 0,81 |
| Production tariff €/MWh | 0,04 | 0,08 |
| Consumption tariff €/MWh | 0,04 | 0,08 |
The unified methodology for determining the balance service price - approved by the Competition Authority 30.12.2019 nr 7-10/2019-013 - can be found attached below.
In the event the Competition Authority shall approve a new methodology for the balance service administrative cost component mechanism for the balance responsible parties, the System Operator will inform the balance responsible parties about the new tariff and methodology at least 30 days in advance.
General principles of the balance agreement:
- Pursuant to the balance agreement, the TSO shall sell to BRP or buy from the BRP as an open supply a volume of imbalance energy necessary to cover the BRP’s imbalance in each ISP (imbalance settlement period).
- The BRP is not allowed to plan for imbalances. The schedules provided by the BRP must be balanced out throughout all the all the MTU-s (market time unit) of the delivery day (24 astronomical hours).
- The BRP shall keep its imbalances within reasonable limits and not utilize the open supply service provided by the TSO for no other reason than to cover unforeseeable deviations in the BRP’s portfolio.
The balance agreement shall become valid at the turn of the calendar month at 00:00 a.m. EE(S)T provided that the following preconditions (in no particular order) have been fulfilled:
1. Both parties have signed the balance agreement.
This includes the exchange of contact information of relevant personnel who have been assigned to execute the tasks arising from said agreement. Those include the person(s) responsible for tackling potential issues relating to the submission of balance schedules, handling of settlement related topics, and invoicing.
2. Both parties have successfully tested the data exchange (in terms of channel, and exchange of schedules).
The TSO accepts balance schedules XML format and data exchange via API (REST POST).
NB! Please note that it shall take at least 2 weeks (14 calendar days), if not more in order to test data exchange. The TSO will provide the BRP with example schedules once the BRP has indicated the scope of its portfolio based on point 7.1.1. of Elering's standard terms and conditions.
3. The market participant has posted, or deposited a fixed collateral in the sum of 31 995 EUR.
4. Both parties have signed the agreement for the use of Data Hub.
The Data Hub user agreement draft and the user guide could be found here: https://elering.ee/en/data-exchange#tab1
5. The market participant has filed a notice of economic activity with the Estonian Competition Authority. This precondition is relevant depending on whether the BRP wishes to start providing open supply service themselves.
More information on this could be found here: https://www.eesti.ee/en/licences-and-notices-of-economic-activity/energetics/notice-of-economic-activity-for-electricity-seller/.
Should the market participant not already have an EIC (X code), one will be provided by the TSO.
Should the market participant wish to set up a branch in Estonia, useful information could be found here: https://www.eesti.ee/en/doing-business/establishing-a-company/registering-the-branch-of-a-foreign-company/.
The System Operator shall apply a mechanism for covering administrative costs based on national legislation and the methodology approved by the Competition Authority. The System Operator uses the administrative cost component to cover the administrative costs arising from rendering balance service, the amount of which is forecasted for the financial year.
The methodology for administrative cost components starting from 01.01.2021 is as follows:
1. The System Operator shall apply balance service administrative cost tariffs on the imbalance volume and on the production and consumption volumes within a balance area.
2. The imbalance tariff (€/MWH) shall be applied for each imbalance settlement period on the absolute value of the balance responsible party’s imbalance volume. The production and consumption tariff (€/MWh) shall be applied for each accounting period on the sum of production and consumption volumes in the balance responsible party’s balance area, the volumes of which are calculated based on the imbalance settlement metering point measurement data with kWh precision (incl. network losses).
3. The imbalance price shall be the same in one imbalance settlement period for both sold and purchased imbalance direction.
4. The total cost for balance service is the sum of imbalance cost and administrative costs.
The balance service administrative cost components are the following:
| Administrative cost components | Value until 31.05.2023 | Value from 01.06.2023 |
| Imbalance tariff €/MWh | 0,60 | 0,81 |
| Production tariff €/MWh | 0,04 | 0,08 |
| Consumption tariff €/MWh | 0,04 | 0,08 |
The unified methodology for determining the balance service price - approved by the Competition Authority 30.12.2019 nr 7-10/2019-013 - can be found attached below.
In the event the Competition Authority shall approve a new methodology for the balance service administrative cost component mechanism for the balance responsible parties, the System Operator will inform the balance responsible parties about the new tariff and methodology at least 30 days in advance.
General principles of the balance agreement:
- Pursuant to the balance agreement, the TSO shall sell to BRP or buy from the BRP as an open supply a volume of imbalance energy necessary to cover the BRP’s imbalance in each ISP (imbalance settlement period).
- The BRP is not allowed to plan for imbalances. The schedules provided by the BRP must be balanced out throughout all the all the MTU-s (market time unit) of the delivery day (24 astronomical hours).
- The BRP shall keep its imbalances within reasonable limits and not utilize the open supply service provided by the TSO for no other reason than to cover unforeseeable deviations in the BRP’s portfolio.
The balance agreement shall become valid at the turn of the calendar month at 00:00 a.m. EE(S)T provided that the following preconditions (in no particular order) have been fulfilled:
1. Both parties have signed the balance agreement.
This includes the exchange of contact information of relevant personnel who have been assigned to execute the tasks arising from said agreement. Those include the person(s) responsible for tackling potential issues relating to the submission of balance schedules, handling of settlement related topics, and invoicing.
2. Both parties have successfully tested the data exchange (in terms of channel, and exchange of schedules).
The TSO accepts balance schedules XML format and data exchange via API (REST POST).
NB! Please note that it shall take at least 2 weeks (14 calendar days), if not more in order to test data exchange. The TSO will provide the BRP with example schedules once the BRP has indicated the scope of its portfolio based on point 7.1.1. of Elering's standard terms and conditions.
3. The market participant has posted, or deposited a fixed collateral in the sum of 31 995 EUR.
4. Both parties have signed the agreement for the use of Data Hub.
The Data Hub user agreement draft and the user guide could be found here: https://elering.ee/en/data-exchange#tab1
5. The market participant has filed a notice of economic activity with the Estonian Competition Authority. This precondition is relevant depending on whether the BRP wishes to start providing open supply service themselves.
More information on this could be found here: https://www.eesti.ee/en/licences-and-notices-of-economic-activity/energetics/notice-of-economic-activity-for-electricity-seller/.
Should the market participant not already have an EIC (X code), one will be provided by the TSO.
Should the market participant wish to set up a branch in Estonia, useful information could be found here: https://www.eesti.ee/en/doing-business/establishing-a-company/registering-the-branch-of-a-foreign-company/.