EFET published its Gas Markets Development Study for 2020. The idea behind this kind of report emerged from an observation that many new virtual trading points and gas markets were being implemented across EU and in connected markets, in very different ways. The development of Entry/Exit systems and hubs bring significant benefits to consumers and markets. However, differences in implementation result in increased transaction costs (for both traders and hub operators) and risks, and unnecessary levels of operational complexity, which will ultimately reduce the overall benefits derived from the Internal Energy Market.
This led to the question: could EFET develop a “best practice” model, based on its experiences (good and bad) in other markets, that could be used to advise NRAs and TSOs of what traders look for in a well-functioning gas market. The objective of EFET is produce a useful and practical guide, which would promote convergence in how gas markets were being designed, and which could be used to promote liquidity.
The criteria for evaluation of the best practices on the gas market include 20 key indicators. Depending on the level of achieving these performance indicators each is evaluated with 0, 0.5 or 1 score. Hence the maximum score for a “best practice” model is 20, on contrary the lowest score is 0.
In this year study Bulgarian gas market scored 7.5, which was one of the lowest scores in comparison with the other EU countries. The scorecard for Bulgaria indicated 0 on the following indicators:
- Establish a reference price at the hub for contract settlement in the event of default
- Price Reporting Agencies producing daily prices at the market
- Voluntary market makers operating at the hub
- Market price becomes reliable and used as benchmark
- Spot market (shorter than monthly products) liquidity
- Forward market (monthly products or longer) liquidity
Access the complete study of EFET at: