COSIMA

COSIMA – the new market model for the Tyrol and Vorarlberg market areas

AGGM to launch EU’s first integrated cross-border gas market in October 2013

The Crossborder Operating Strongly Integrated Market Area (COSIMA) model, developed by AGGM and its market partners, links the Tyrol and Vorarlberg market areas in Austria with the German NCG market area.

COSIMA will achieve an unprecedented level of integration between gas markets in different EU member states.  The Austrian Natural Gas Act 2011 and Gas Market Model Ordinance 2012 laid the legal groundwork for this breakthrough.

When COSIMA goes live on 1 October 2013, suppliers will no longer need to reserve cross-border transport capacity. The new model will open the way for direct, congestion-free deliveries to consumers in Tyrol and Vorarlberg from the NCG virtual trading point.

COSIMA shows that gas market integration in Europe is not just a political pipe dream and can be put into practice. The model will benefit consumers by stimulating competition on the Tyrol and Vorarlberg gas markets.

The operating rules are very simple. Suppliers will transfer gas destined for consumers in Tyrol or Vorarlberg to AGGM at the NCG virtual trading point. These transactions will be processed via the virtual trading point, in accordance with the German market rules for the transfer of gas between balancing groups. AGGM will organise onward transportation to Tyrol and Vorarlberg, and book the necessary cross-border interconnector capacity. Similarly to the German system, the related costs will be passed on to consumers at the exit points.

An integrated balance group system conforming to the Austrian market rules will be used to settle Tyrolean and Vorarlberg consumers’ balancing energy costs. Suppliers will only need one balance group in Tyrol and Vorarlberg. The precise quantities of gas they transfer to AGGM at the NCG virtual trading point will be credited to them via this balance group.