U.K. May Delay Northwest European Power Market Coupling

Europe’s plan to link day-ahead electricity markets in 15 countries may miss its Nov. 26 start due to changes needed in the U.K. power market, according to Amsterdam-based exchange operator APX Group.

APX and N2EX, a U.K. exchange jointly owned by Nord Pool Spot AS and Nasdaq OMX Group Inc., must set up a virtual trading hub and harmonize their daily auctions to create a single price, APX said. There is a risk the hub may not be ready on time, Olaf Islei, the public and regulatory affairs adviser at APX, told journalists at a briefing in London yesterday.

The European Union plans to link electricity markets in 28 countries by the end of 2014, allowing power to flow freely to markets with the highest prices. When the project is complete, it will reduce national barriers and cut consumer costs, according to the European Commission.

Missing the deadline in the U.K. would push back market coupling for the rest of northwest Europe, Islei said.

APX is responsible for making sure that the Netherlands-U.K. BritNed connection is capable of participating in market coupling, while Nord Pool has responsibility for the IFA cable between France and the U.K., according to Richard Sarti, sales and business development manager at Nord Pool Spot.

“Our development of the virtual hub, enabling the England-France IFA cable to participate in NWE market coupling, has been tested and is ready for the go-live date,” Sarti said by phone from London today.

ACER Outline

The Agency for the Cooperation of Energy Regulators, which is coordinating the coupling of European power markets, outlined the risks of delay at an electricity stakeholder advisory group on Oct. 24, Islei said.

David Merino, a spokesman for ACER, wasn’t immediately available for comment when contacted by phone.

The U.K.’s virtual hub will be part of the northwest-Europe region, which also includes Germany. The start date for linking this region will be confirmed before a meeting of regulators on Nov. 12, Islei said.

The southwest region, including Spain and Portugal, will be coupled at a later date, according to APX.

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