Energoatom is a state-owned company that operates four nuclear power plants, which include 15 nuclear units, 2 units of Tashlyk Pumped Storage Power Plant, and 2 units of Oleksandrivska Hydropower Plant. The company provides 50-55% of the country’s electricity needs, and during winter this value can reach up to 70%. On the other hand, Energoatom is one of the main Public Service Obligation (PSO) responsible party, who is defined to provide the Guaranteed Buyer electricity with volumes necessary to meet the consumption of households. These sales corresponds to 50-55% of its total production and affect its sales profile for night and day hours depending on the total household consumption profile determined and notified by the Guaranteed Buyer. On the other hand, Energoatom is obliged to sell 10% of its production on Day-Ahead Market (DAM) like any other producer to increase the liquidity in this segment. Rest of the available electricity (i.e., 35-40% of the production) can be sold through either DAM or bilateral contracts (through electronic auctions at a trading platform under rules approved by the Cabinet of Ministers of Ukraine). Moreover, when Energoatom’s sales in the market of bilateral contracts are unsatisfactory, which is complicated by the large number of electricity sold in the imbalance market (at minimal prices), which was formed as a result of PSO obligations (surplus electricity in the night zone).
The commitments provided for the supply of electricity for the household consumption under the PSO mechanism were almost free of charge previously and now are almost 1/4 of the production cost. Moreover, inefficient trading strategy causes Energoatom to be positively imbalanced in real-time and sell its energy at cheap prices due to pricing of imbalances in the balancing market. Considering the large share of generation allocated for the PSO mechanism and other challenges above, trading strategy of Energoatom must be carefully determined at all times in order to ensure financial stability of the company. In this context, regardless of possible changes in the price of electricity sold under the PSO mechanism in near future, Energoatom needs to continuously improve its trading strategy to optimize its revenues from trading in different market segments based on market trends.
The trainings planned under the SOW aim to acquaint and provide tools for effective trading strategy development and portfolio optimization in different market segments (i.e. Day-Ahead, Intra-Day, Balancing and Bilateral Contracts markets) to Energoatom and its division Energoatom Trading.
Scope of Work
- Development of the training program on trading to address the needs of the Energoatom, considering existing responsibilities, and product portfolio.
- 5-day training (online) on electricity trading, which should include:
- Portfolio management in the organized electricity market
- Monitoring and forecasting market trends and prices
- Trading optimization to determine the strategy in different segments
- Assessment of the current portfolio and PSO responsibilities
- Determining schedule flexibility parameters – sales positions
- Addressing maintenance risks
- Developing trading strategies for different market segments (e.g., day-ahead, intra-day, balancing and bilateral contracts) using available products
- Effective mechanism for decision making
- Development of efficient trading strategy(ies) jointly with Energoatom for trading in spot and forward market segments.
- Assessment of the jointly developed trading strategy(ies) based on implementation results and existing trading strategy before the training. Assessment must also include recommendations for improvements using the knowledge acquired through trainings.
SUBMISSION OF PROPOSALS
All proposals are due on March 10, 2021 by no later than 14:00 local time in Ukraine. Proposals must be submitted via e-mail at the address UESPprocurement@tetratech.com in the following formats: Adobe Acrobat and Microsoft Word and/or Excel.
All proposals must fully respond to the Technical Specifications enclosed as Attachment A and must include quotes in the format provided in the Attachment B – Table 1 – Detailed Budget. Proposals received after the above-stated due date and time will not be considered for this procurement.
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