The development of gas hubs in Europe

Miriello, Caterina; Polo, Michele

doi:10.1016/j.enpol.2015.05.003

Cited by 33 publications

(6 citation statements)

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“…Over the last two decades, a series of European regulatory reforms have prompted the emergence of a collection of day-ahead wholesale markets for natural gas, the so-called "gas hubs," that turned out to become an important source of gas procurement as the previously monopolized industry structure gradually became more fragmented (Miriello and Polo, 2015). By construction, these markets have been developed to cope with local network balancing needs and allow an optimal scheduling of resources.…”

Section: Introductionmentioning

confidence: 99%

How are Day-ahead Prices Informative for Predicting the Next Day’s Consumption of Natural Gas? Evidence from France

Thomas¹,

Massol²,

Sévi³

2022

The Energy Journal

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The purpose of this paper is to investigate whether the next day's consumption of natural gas can be accurately forecast using a simple model that solely incorporates the information contained in dayahead market data. Hence, unlike standard models that use a number of meteorological variables, we only consider two predictors: the price of natural gas and the spark ratio measuring the relative price of electricity to gas. We develop a suitable modeling approach that captures the essential features of daily gas consumption and in particular the nonlinearities resulting from power dispatching. We use the case of France as an application as this is, as far as is known, the very first attempt to model and predict the country's daily gas demand. Our results document the existence of a long-run relation between demand and spot prices and provide estimates of the own-and cross-price elasticities. We also provide evidence of the pivotal role of the spark ratio which is found to have an asymmetric and highly nonlinear impact on demand variations. Lastly, we show that our simple model is sufficient to generate predictions that are considerably more accurate than the forecasts published by infrastructure operators.

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Section: Introductionmentioning

confidence: 99%

How are Day-ahead Prices Informative for Predicting the Next Day’s Consumption of Natural Gas? Evidence from France

Thomas¹,

Massol²,

Sévi³

2022

The Energy Journal

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“…For example, the Netherlands or the United Kingdom provided liberalization process faster than Italy or Germany. That is why institutional arrangements of gas market regulation were aimed at accelerating market integration (Miriello & Polo, 2015). However, even supply expansions in 2010s had a weak effect on gas price convergence.…”

Section: Literature Reviewmentioning

confidence: 99%

Price convergence on the national gas markets of the Eastern European region

Bublyk

Курбет

Yukhymets

2022

Problems and Perspectives in Management

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Establishing institutional arrangements for regulating gas markets toward price convergence is one of the crucial integrational factors. The strategy of the firm and economic development management depends on it. The paper aims to assess the characteristics of price convergence on the natural gas markets of the Eastern European region. This region is relevant for Ukraine in a number of parameters. The assessment was made based on Eurostat data for different groups of consumers, excluding taxes, using the standard deviation detection method of price convergence for 15 countries in 2007–2020. Despite the revealed generally positive price convergence on the natural gas markets in the considered countries after 2014, obtained results showed three points that highlight the heterogeneous structure of the process. First, an even movement toward a single price is detected in groups of large households (the standard price deviation of the price decreased in 2014–2020 from 2.7 to 1.9 euro per Giga Joule or 1.5 times) and medium industrial enterprises (the standard deviation decreased from 1.0-1.7 to 0.6-1.1 or 1.5-1.8 times). Second, the prices for the largest industrial enterprises in considered countries approached the fastest (the deviation decreased from 2.0 to 0.5). Third, in the segment of small enterprises, the deviation even increased from 2.1 to 2.2 (1.05 times). This result highlights the gap in the institutional mechanisms of European integration and sources of uncertainty for the small firms’ management. AcknowledgmentThe paper was funded as a part of the “Determination of institutional conditions for the development of the exchange segment of the gas market” research project (No. 0122U002205), conducted at the State Institution Institute for Economics and Forecasting of the NAS of Ukraine.

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“…8 The role of the hub became more prominent leading up to 2006 with the gradual liberalization of gas markets. As explained in detail by Miriello and Polo (2015), the ZEE hub, as well as the other European hubs, were initially developed to cope with local network balancing needs. However, they turned out to become a source of gas procurement as the previously monopolized industry structure gradually became more fragmented.…”

Section: The Ec's Merger Decision Within the Context Of The Zee Hubmentioning

confidence: 99%

“…A hub can be a physical installation, where gas flows are connected to and pass through this point (as in Belgium) or they can be virtual whereby no precise geographical location is specified (as in the UK or in the Netherlands). For an interesting account of the development of gas hubs in Europe, see Miriello and Polo (2015).…”

Section: Introductionmentioning

confidence: 99%

A Retrospective Evaluation of the GDF/Suez Merger: Effects on the Belgian Gas Hub

Argentesi¹,

Banal‐Estañol²,

Seldeslachts³

2021

The Energy Journal

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We present an ex-post analysis of the effects of GDF's acquisition of Suez in 2006, which created one of the world's largest energy companies. We perform a series of econometric analyses on the market for trading at the Zeebrugge gas hub in Belgium. Removing barriers to entry and facilitating access to the hub through ownership unbundling were an important part of the objectives of the remedies imposed by the European Commission. Our analyses show a robust price decline after the merger. Additional evidence on traded volumes and hub participants is in line with an increased liquidity at the hub post-merger. This suggests the remedies were effective in limiting the potential anti-competitive effects of the merger. Moreover, it suggests that ownership unbundling has generated improved access to the hub. Therefore, remedies may have done more than simply mitigate the potential anti-competitive effects of the merger; they may have effectively created competition.

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The development of gas hubs in Europe

Cited by 33 publications

References 10 publications

How are Day-ahead Prices Informative for Predicting the Next Day’s Consumption of Natural Gas? Evidence from France

How are Day-ahead Prices Informative for Predicting the Next Day’s Consumption of Natural Gas? Evidence from France

Price convergence on the national gas markets of the Eastern European region

A Retrospective Evaluation of the GDF/Suez Merger: Effects on the Belgian Gas Hub

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