Market areas

A market area represents the virtual merger of transmission systems and downstream distribution systems to form a single balancing zone. In this respect, market areas are comparable to trading zones. They simplify gas trading. Within a market area, gas transmission customers (or shippers) can conclude exit and entry contracts and use the capacities booked in a flexible way.

Virtual trading points

In Germany, contracts, i.e. gas trading transactions, are mainly implemented not in a physical sense but via the virtual trading point of the market area. A virtual trading point is only a contract mechanism. At the virtual trading point, gas quantities are delivered in a virtual way, e.g. from a transmission system operator to the exit network operator. For each gas transmission customer (or “shipper”) the entry and exit quantities on each day have to be balanced. For this purpose, entry and exit quantities are combined to form balancing groups. These balancing groups are coordinated by the operators of the two market areas GASPOOL Balancing Services GmbH und NetConnect Germany GmbH & Co. KG. The responsibility for actual balancing lies with the balancing group manager, which is normally one of the gas dealers involved.

Cooperation between the transmission system operators in market areas simulates the simultaneous trading of energy quantities, a process which is well known from the power market. It is only this approach that allows the flexible delivery of gas to customers right down to products covering only one day or even part of a day. The result is to significantly boost competition in the natural gas market.

Market area mergers in Germany

In Germany, there have been only two market areas for gases of all qualities since 1 October 2011: GASPOOL in northern and eastern Germany and NetConnect Germany (NCG) in western and southern Germany.

The GASPOOL market area is formed by the transmission systems of GASCADE Gastransport GmbH, Gastransport Nord GmbH, Gasunie Deutschland Transport Services GmbH, Nowega GmbH and ONTRAS Gastransport GmbH. jordgas Transport GmbH also forms part of the market area cooperation arrangement. Since October 2011, GASPOOL has included about 400 downstream network operators for the distribution of natural gas to gas users.

The companies cooperating within the NCG market area are bayernets GmbH, Fluxys TENP GmbH, GRTgaz Deutschland GmbH, Open Grid Europe GmbH, terranets bw GmbH and Thyssengas GmbH. The high-pressure pipeline system in the NCG market area has a total length of about 20,000 km and connects more than 500 downstream distribution systems.  

The market areas are operated by the companies GASPOOL Balancing Services GmbH und NetConnect Germany GmbH & Co. KG. The two market area coordinators manage activities within their market areas. On behalf of the transmission system operators, they focus on operating the virtual trading point, on balancing group management and on control energy management.

 

Group L and group H gas

As a natural product, natural gas has a different chemical composition and a different calorific value depending on its origin. Group L gas (low calorific value gas), which is imported to Germany for example from the United Kingdom and the Netherlands, has a methane content of between 80 and 87 percent. Group H gas (high calorific value gas), for example from Norway or Russia, has a methane content between 87 and 99%. The two gas qualities cannot be mixed in any proportion desired.