Under the REMIT transactions and orders reporting scheme the right of the purchaser under the contract to waive its right to off-take a pre-defined percentage of the monthly and daily volumes of electricity are to be reported in Field No 21 (volume optionality), Field No 22 (volume optionality frequency), Field No 23 (volume optionality intervals) of Table 2 stipulated in the Annex to the Commission Implementing Regulation (EU) No 1348/2014).
Non-standard reporting form has the following specification for volume optionality:
Table 2
Reportable details of non-standard contracts for the supply of electricity and gas
(Non-standard reporting form)
Extract
Fixing index details - Fields No. 21 - 23
|
Field No.
|
Field Identifier
|
Description
|
| 21 | Volume optionality |
The volume classification. |
| 22 |
Volume optionality frequency |
The frequency of the volume optionality: e.g. daily, weekly, monthly, seasonal, annual or other, if available |
| 23 |
Volume optionality intervals |
Time interval for each volume optionality if available.
|
Volume optionality can play important role when qualifications are made whether given contract is subject to the REMIT reporting.
Particularly, a contract containing such a clause may influence the reporting obligations where a counterparty to the contract is a final customer with a single consumption unit with a technical capability to consume less than 600 GWh/year.
If the energy is bought by the final customer but not consumed because there is a volume optionality for the execution of the non-standard supply contract and the energy has not been physically delivered, such contract for supply of energy is not reportable under REMIT.
Questions and Answers on REMIT (Question III.4.42)
What are the reporting obligations of a final customer with a single consumption unit with a technical capability to consume less than 600 GWh/year if the energy bought by the final customer is not for its consumption use?
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Scenario II: Energy was purchased by the final customer from the Supplier A, but not consumed because there is a volume optionality for the execution of their non-standard supply contract. The energy has not been physically delivered yet. In this case, the contract for supply of energy is not reportable and the final customer is not a market participant entering into transactions which are required to be reported to the Agency under REMIT regarding such contracts. However, it can still be subject to REMIT with regard to the prohibition of market manipulation, including attempted market manipulation, according to Article 5 of REMIT, with regard to insider trading, according to Article 3 of REMIT and with regard to the obligation to publish inside information according to Article 4 of REMIT.
Finally, please note that this scenario does not apply if Supplier A resells the energy in the wholesale energy market on behalf on the final customer. In such case, the final customer is a market participant entering into transactions which are required to be reported to the Agency under REMIT.
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Frequently Asked Questions (FAQs) on REMIT transaction reporting
Question 3.2.5 Data field (21), (22) and (23)
We hereby request your answer to our below questions in connection with the interpretation of the reporting obligations under the "Implementing Acts.
On the basis of Article 5 (1) of the Implementing Acts, details of transactions executed within the framework of non-standard contracts specifying at least an outright volume and price shall be reported using Table 1 of the Annex. According to Section 3.2.5 of the REMIT Transaction Reporting User Manual, even if the contract is considered a non-standard contract, but has an agreed price and quantity, the contract has to be reported using Table 1 of the Implementing Acts.
Can you please confirm that our below interpretation is correct, or in case any of our below statements would not be correct, we would be grateful if you could please provide us with your interpretation:
* Fields No 21 to 23 of Table 2 of the Implementing Acts provides for the possibility to report optionality of the volumes supplied under a given contract. In our interpretation, the right of the purchaser under the Contract to waive its right to off-take a pre-defined percentage of the monthly and daily volumes of electricity may be reported in Fields No 21 to 23 of Table 2.
Answer
The above interpretation is correct. Market participants may refer to Annex II to the Transaction Reporting User Manual (TRUM) which contains examples of transaction reporting for both standard and non-standard contracts. Section (2) of Annex II contains examples of non-standard contracts to be reported with Table 2 of the Annex of the REMIT Implementing Regulation.
In Annex II of the TRUM, our understanding of the reporting of non-standard contracts and the execution under non-standard contracts is presented. In addition, some basic rules for their reporting are listed.
The Guidance is supported by examples of non-standard contracts which include the possibility to report optionality of the volumes supplied under a given contract.
Frequently Asked Questions (FAQs) on REMIT transaction reporting
Question 3.2.6
Data field (21) Table 2 Field 21 – Volume optionality
How do we differentiate between "C" for Complex and "O" for Other?
Especially as there are no examples in the TRUM that use "O".
Answer
From the Agency's point of view, "C" for Complex should cover all the cases where the volume optionality cannot be classified as one of the non-Complex options (i.e. Variable, Fix or Min/Max). We are currently not aware of any possible use of "Other".
Frequently Asked Questions (FAQs) on REMIT transaction reporting
Question 3.1.9
Should a bilateral contract (initially classified as a non-standard contract and also reported in a non-standard format) keep its non-standard status and therefore any event under this contract will lead to a lifecycle event reportable under this non-standard contract (no standard contract will be reported and no standard contract format will be used)? Or will it be mandatory to report this contract as a standard contract, or as a non-standard contract in a standard contract format?
Answer
A non-standard contract with no defined price or quantity, has to be reported using Table 2 with a timeline of T+1 month. The execution of optionality under that non-standard contract, reportable using Table 1, will still be part of Phase 2 and is reportable with a timeline of T+1 month.
Please see Annex II to the Transaction Reporting User Manual (TRUM) for additional details.
Frequently Asked Questions (FAQs) on REMIT transaction reporting
Question 3.1.10
Reference to Article 5 (1) of the REMIT Implementing Regulation If an electricity supply contract (the "Contract") concluded between a generator and a trader outside of an organized market, with delivery in the European Union, providing the right to the purchaser to waive its right to off-take a pre-defined percentage of the monthly and daily volumes of electricity determined in the Contract, can be reported using Table 2 of the REMIT Implementing Regulation.
In our interpretation, as the volumes of electricity which will actually be delivered under the Contract cannot be determined at the time of the conclusion of the Contract, the Contract may not be considered as a contract specifying an outright volume within the meaning of Article 5 (1) of the Implementing Acts. Therefore, the Contract may be reported using Table 2 of the Implementing Acts.
In our interpretation, the right of the purchaser under the Contract to waive its right to off-take a pre-defined percentage of the monthly and daily volumes of electricity may be reported in Fields No 21 to 23 of Table 2.
In our interpretation, no subsequent reporting would be required to the Agency due to the fact that the volumes supplied under the Contract deviate from the volumes set out in the Contract provided that the volumes of the electricity actually off-taken by the trader fall within the optionality conditions as reported to the Agency following the conclusion of the Contract.
Answer
The contract shall be reported with table 2. The characteristics of the contract regarding volume optionality have to be reported in the fields 21-23. For more information please see the TRUM as well as Annex II of the TRUM for specific examples.
Documentation
Commission Implementing Regulation No 1348/2014 of 17 December 2014 on data reporting implementing Article 8(2) and Article 8(6) of Regulation (EU) No 1227/2011 of the European Parliament and of the Council on wholesale energy market integrity and transparency (Annex Table 2 Fields No 21, 22, 23)
Questions and Answers on REMIT (Question III.4.42)
Frequently Asked Questions (FAQs) on REMIT transaction reporting (Questions 3.2.5, 3.2.6, 3.1.9, 3.1.10)
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