UKRAINE NEEDS TO IMPLEMENT MARKET COUPLING WITH THE EU AS SOON AS POSSIBLE. A SINGLE NOMINATED MARKET OPERATOR DETERMINATION WILL FACILITATE THIS PROCESS

JSC Market Operator supports the joint electricity trading implementation on the spot market of the United Europe to be accelerated. This will allow to timely implement the EU Regulation 2015/1222 CACM and fulfill Ukraine's commitments as a candidate for EU membership. A single nominated market operator determination will facilitate this process, in particular.  It was emphasized by Daniil Petrenko, Deputy Director General of JSC “Market Operator”, during the discussion on the optimal model for the NEMO appointment.

The principle of NEMO operation within the integrated electricity markets is to conduct trades at the national level for DAM and IDM with subsequent bids and prices comparison, processing of such bids and prices calculation, as well as settlements for electricity purchased and sold, which is the performance of the NEMO function of a market coupling operator. Therefore, firstly, it is necessary to take into account the electricity market conditions in general, DAM and IDM volumes of Ukraine, as well as the relevant indicators of neighboring countries while implementing the relevant decision on the monopoly or competitive model of the NEMO.

"Since Ukraine has a small liquidity rate in the spot market, the introduction of a competitive model will increase the cost of NEMO services and may lead to debts in the DAM, as the electricity purchase and sale legally goes through the NEMOs involved. Therefore, in this case, it would be possible to buy electricity on the side of one NEMO and not pay for it. As a result, the NEMO that has not been settled, will not be able to pay the NEMO for electricity sold, which will provoke debts arising on the DAM. Similar cases have already occurred in the balancing market, when electricity was purchased without the intention to pay for it" Daniil Petrenko, Deputy CEO of Market Operator, said.

He has also added that European practice shows that countries where the competitive NEMO model has been chosen, the volume of trading is much higher than in Ukraine.