Gas Market Distorting Effects of Imbalanced Gas Balancing Rules: Inefficient Regulation of Pipeline Flexibility

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dc.contributor.authorKEYAERTS, Nico
dc.contributor.authorHALLACK, Michelle
dc.contributor.authorGLACHANT, Jean-Michel
dc.contributor.authorD’HAESELEER, William
dc.date.accessioned2011-02-01T13:10:10Z
dc.date.available2011-02-01T13:10:10Z
dc.date.issued2010
dc.description.abstractThis paper analyzes the value and cost of line-pack flexibility in liberalized gas markets through examination of the techno-economic characteristics of gas transport pipelines and the trade-offs between different ways to use the infrastructure: transport and flexibility. Line-pack flexibility is becoming increasingly important as a tool to balance gas supply and demand over different periods. In the European liberalized market context, a monopolist unbundled network operator offers regulated transport services and flexibility (balancing) services according to the network code and balancing rules. Therefore, gas policy makers should understand the role and consequences of line-pack regulation. The analysis shows that the line-pack flexibility service has an important economic value for the shippers and the TSO. Furthermore, the analysis identifies distorting effects in the gas market due to inadequate regulation of line-pack flexibility: by disregarding the sunk costs of flexibility in the balancing rules, the overall efficiency of the gas system is decreased. Finally, the analysis demonstrates that the actual costs of line-pack flexibility are related to the peak cumulative imbalance throughout the balancing period. Any price for pipeline flexibility should, therefore, be based on the related trade-off between the right to use the line-pack flexibility and the provision of transport services.
dc.format.mimetypeapplication/pdf
dc.identifier.citationEnergy Policy, 2010, 39, 2, 865-876en
dc.identifier.doi10.1016/j.enpol.2010.11.006
dc.identifier.issn1873-6777
dc.identifier.issn0301-4215
dc.identifier.urihttps://hdl.handle.net/1814/15510
dc.language.isoenen
dc.relation.ispartofseries[Florence School of Regulation]en
dc.relation.ispartofseries[Energy]en
dc.relation.ispartofseries[Gas]en
dc.rightsinfo:eu-repo/semantics/openAccess
dc.titleGas Market Distorting Effects of Imbalanced Gas Balancing Rules: Inefficient Regulation of Pipeline Flexibilityen
dc.typeArticleen
dspace.entity.typePublication
eui.subscribe.skiptrue
person.identifier.orcid0000-0002-0237-5629
person.identifier.other36571
person.identifier.other30744
relation.isAuthorOfPublication3733b2dc-9e7b-4480-ba80-01d76e2a891a
relation.isAuthorOfPublicationce0d5277-d7d1-4bab-b64c-812f4357986f
relation.isAuthorOfPublication.latestForDiscovery3733b2dc-9e7b-4480-ba80-01d76e2a891a
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