Efet Hubs Ranking Study Nudges TTF Lower

The European Federation of Energy Traders (Efet) published its fourth annual ‘Gas Hubs Benchmarking Study’ November 13. 

The Dutch TTF is Europe’s most liquid gas trading hub in volume terms, ahead of the UK. Nonetheless Efet's study this year marked TTF down slightly on ease-of-operation factors, such as its consultation of market players and its rules for cashout penalties, relative to the UK’s NBP which achieved a maximum 20 out of 20 points, compared with TTF’s 19. Other mature hubs in Germany (NCG, Gaspool), France and Italy are marked down, relative to 2016, for similar reasons. 

Industry association Efet reported continued improvement in design for many of the mid-maturity and some nascent hubs, including a recognition of changes introduced in 2016 that have now filtered through to better operation. In terms of design, it remarked that the Austrian VTP and Spanish PVB hubs now rank with the Italian PSV, with significant improvements measured for Czech and Hungarian hubs. 

But while Poland received a slightly higher score than last year, Efet notes that excessive obligations related to security of supply have substantially reduced its earlier attractiveness for trading since.

The study for the first time includes Ukraine, which has established a basic virtual trading point, even though most trading for Ukraine takes place on the borders and surrounding markets. Despite this, Ukraine’s 3.5 score ranks it ahead of hubs in two EU markets: Romania and Bulgaria.

“The study has attracted interest from a number of hub operators and regulatory authorities, who are keen to find the best ways to encourage liquidity at the developing hubs,” said Steve Rose, chair of the Efet gas hub development group. “In particular, the scorecard has been used as guidance in the Cesec [central and southeast Europe]  markets.”

“We will continue the dialogue with the European Commission, Acer [Agency for Cooperation of Energy Regulators], national regulatory agencies, and other relevant stakeholders about further ways to improve the levels of tradeability across the developing gas markets”, said Doug Wood, Chair of the Efet gas committee.    

This year's study took much longer to publish, though it did not explain why; the previous three studies typically appeared in early summer 2014-2016.

Scorecard from the Efet 2017 'Gas Hubs Benchmarking Study'

Mark Smedley