Virtual Trading Point (VTP)

Virtual Trading Point (VTP) is a non-physical commercial point within an entry-exit system where gases are exchanged between a seller and a buyer without the need to book transmission or distribution capacity (Article 2(55) of the European Commission Proposal of 15 December 2021 for a Directive of the European Parliament Parliament and of the Council on common rules for the internal markets in renewable and natural gases and in hydrogen, COM/2021/803 final).

 
When it it comes to legal definitions that are already binding, Article 2(3) of the Council Regulation (EU) 2022/2578 of 22 December 2022 establishing a market correction mechanism to protect Union citizens and the economy against excessively high prices also defines a ‘virtual trading point’ or ‘VTP’ as “a non-physical commercial point within an entry-exit system where gas is exchanged between a seller and a buyer without the need to book transmission or distribution capacity”.

In the ACER Report of 5 April 2019 on the conditionalities stipulated in contracts for standard capacity products for firm capacity the EU energy market regulator expressed on opinion that:
“Full access to the VTP in an entry-exit system is considered crucial for a well-functioning gas market. The VTP allows gas trading, virtual title products transfer within the entry-exit zone and underpins the trading activity that takes place in the organized markets. The VTPs put an end to traditional trading “at the flange”, which was bilateral trading at physical points of the system. Firm capacity products allow for the effective use of an entry-exit system, since firm products allow network users freely and independently to book and allocate capacity at entry and exit points and reach the VTP on a firm basis”.

The legal catalogue of definitions in Article 2 of the above said Proposal for a Gas Directive is also complemented with a definition with a  ‘virtual interconnection point’, which means two or more interconnection points which connect the same two adjacent entry-exit systems, integrated together for the purposes of providing a single capacity service (point 59) where ‘interconnection point’ means “a physical or virtual point connecting adjacent entry-exit systems or connecting an entry-exit system with an interconnector, in so far as these points are subject to booking procedures by network users”. 

   Documentation

Proposal for a Directive of the European Parliament Parliament and of the Council on common rules for the internal markets in renewable and natural gases and in hydrogen, COM/2021/803 final

Proposal for a Regulation of the European Parliament Parliament and of the Council on the internal markets for renewable and natural gases and for hydrogen (recast), COM/2021/804 final

ACER Report of 5 April 2019 on the conditionalities stipulated in contracts for standard capacity products for firm capacity


Study on the conditionalities stipulated in contracts for standard capacity products for firm capacity sold by gas TSOs, Final Study, Grant Thornton Tax and Business Advisory Solutions SA., in association with REF-E SRL, VIS Economic & Energy Consultants Consulting Services S.A., Grant Thornton Advisory, Baringa Partners LLP, 3 April 2019