About balancing

Introduction

The most important aspects of this regime are:

1. Every market party is responsible for its own imbalance position and is able to restore this position based on near real time information delivered by GTS.
2. If so required, GTS will restore the balance at system level. The information concerning system balance and the means by which GTS maintains and, if necessary, restores the balance (the bid price ladder) are transparent and market-based.
3. Market parties are encouraged to help GTS to maintain and if necessary restore the system balance and are rewarded for doing so, market parties that cause system imbalance will be charged on a cost-reflective basis.
 

Basic balancing

Before the gas day starts, shippers send in a programme containing predictions of their entries, exits and trades. In this programme, the shippers apply the damping formula  which enables them to enter gas with a pattern that is damped compared to the pattern in the exit programme.

During the gas day GTS compares this programme with the actual allocation on a near real time basis to determine the portfolio imbalance. The calculated imbalances per portfolio are accumulated and shared with market parties, on an individual basis through the Portfolio Imbalance Signal (POS). The summation of all POSes is called System Balance Signal (SBS) and is published on the same time scale as the POS.

GTS monitors the SBS and takes corrective action if necessary. Deviation of the SBS from zero indicates a system imbalance, and the deviation is classified by zones. If the SBS is in the dark green zone, no action is necessary. However if the SBS is either in the light green, orange or red zone, a correction mechanism called the Bid Price Ladder (BPL) will come into action.

Aided by the imbalance information stored in POS and SBS, shippers (possibly supported by end users or producers) can choose to either help restore the system balance or maintain their own portfolio (im)balance. They can do so by using their own (physical) means, trading on the TTF, entering into commercial balancing relations or by leaving their position as it is (and accepting the consequences of the bid price ladder). 

Market parties can offer to sell gas to or buy gas from GTS on the bid price ladder. GTS will buy or sell gas from/to these parties to restore the system balance.

This balancing regime is, by its very nature, without a fixed balancing period and a short or long position in a portfolio can remain without consequence for some time.