According to EU regulation 2016/1719 of
September 26, 2016 establishing guidelines on forward capacity allocation, NCC
performed analysis on electricity price risk hedging opportunities in
Lithuanian bidding zone. After evaluation NCC states that Lithuanian bidding
zone does not have specially for Lithuanian electricity market developed Nasdaq
risk hedging financial product, however Lithuanian wholesale electricity market
participants have possibility to use hedging products provided in Latvian
bidding zone, as there is no significant difference between electricity prices
in Lithuania and Latvia. NCC also states that Lithuanian bidding zone does not
have sufficient risk management tools for cross-border risk hedging or they are
not effective in comparison with Nordic countries.
After completion of analyses on May 12,
2017 NCC took a decision in order to promote effective wholesale electricity
market operations and instructed Lithuanian electricity transmission system
operator AB Litgrid within 6 months to ensure the opportunity for the
electricity wholesale market participants to purchase long-term cross-border
risk hedging products without issuing long-term transmission rights.
NCC informed Latvian, Swedish and Polish
regulatory authorities with directly coordinated final decision on cross-border
risk hedging products.
