Market Access

GUARANTEES

In order to operate on the PCE, Participants shall submit – alternatively or cumulatively - financial guarantees as:

1. first demand bank guarantee issued by banks registered as provided for in Article 13 of the Legislative Decree no. 385 of 1 September 1993, and which have a long-term rating awarded by at least one of the following rating agencies: Standard & Poor's Ratings Services, Moody's Investor Service, Fitch and DBRS. The rating must be at least BBB- of the Standard & Poor’s or Fitch scales or Baa3 of the Moody’s Investor Service scale or BBB low of the DBRS scale;
2. non-interest-bearing deposit to be disposed on the bank account held by GME with the bank in charge of the Electricity Market treasury service.

PA Participants can provide guarantees only as non-interest-bearing deposit to be disposed on the bank account held by GME with the bank in charge of the Electricity Market treasury service.
The guarantees provided by the Participant on the PCE are reduced by an amount defined as the maintenance margin, set at 3% of the total amount of the guarantees.
Once the bank guarantee is provided, this can be subject to updates of the amounts and/or of its validity period, by submitting the specific form.

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BANK GUARANTEES

The bank guarantee, the form modifying the bank guarantee or the related updating letters must be submitted or sent (where possible by registered letter with return receipt or courier) only to the bank in charge of GME's treasury services. Upon receipt, the bank will place a stamp on the document with the time/date of receipt, which will become the "date of submission".

The bank guarantee must be sent to the address of the bank in charge of GME's treasury services:

Banca Popolare di Sondrio Società per Azioni
Viale Cesare Pavese, 336 - 00144 - Rome - Italy 
To the attention of: Ufficio Crediti (Credits Dept.)

For the acceptance of the bank guarantee, the issuing bank must send a swift 799 message to POSOIT22ROM specifying in the field 21 "138–GME" and the following text in the field 79 (free text) “Si conferma che la fideiussione (o lettera di aggiornamento o lettera di patronage) n. ... di € ... nell’interesse dell’operatore .... è stata da noi emessa in data .... e le firme ivi apposte hanno il potere di impegnare il nostro Istituto per siffatte garanzie” (courtesy translation: We confirm that we have issued the bank guarantee (or updating letter or letter of patronage) no. ...... of € …. in favor of the Participant on...... and that the signatures affixed thereto commit our bank to fulfil the obligations arising from the aforesaid bank guarantee).

The Participant may at any time request the return of the bank guarantee according to the terms and conditions established in PCE Technical Rule n. 10.

For the purpose of guarantee submission and related update letters, the documents must be drawn up according to the templates attached to the PCE Regulations and available in the appropriate "forms" section, otherwise the documents cannot be accepted.

If the Participant also wants to operate on netting markets, it can submit a guarantee according to the forms attached to the Integrated Text of the Electricity Market Rules or to the Natural Gas Market Regulation and allocate part of the guarantee provided to cover exposures that may arise on ME, MGAS and PCE, by submitting to GME the guarantee distribution form of netting market according to the terms and conditions defined in ME Technical Rules n. 04 and in MGAS Technical Rules n. 19.

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NON-INTEREST-BEARING DEPOSIT

The bank details of the account, to which the bank transfer must be performed, are:
Banca Popolare di Sondrio
IBAN IT97 H056 9603 2110 0000 7220 X46
SWIFT CODE POSOIT22

The reason for payment shall mention the following heading:
“PCE – deposito infruttifero con facoltà per il GME di poterne disporre”.

The Participant may at any time request the return of the non-interest-bearing deposit according to the terms and conditions established in PCE Technical Rules n. 10.

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EXPOSURE

On the PCE, GME defines the exposure of each Participant based on the risk of potential failure to fulfil the obligation related to the payment (settlement) of the CCT (Fee for the assignment of rights to use the transportation capacity) and requests that it is covered by adequate guarantees.

Depending on the operations, the exposure will be calculated per single flow day and then cumulatively aggregated by settlement date. Therefore, during the registration request on PCE and the further steps to the settlement, GME carries out the financial adequacy checks aimed at verifying that the dedicated guarantee given is adequate with respect to the single exposure held (See PCE Technical Rules N. 04).

More specifically, if a registration on the PCE of a sale transaction is submitted or confirmed on an inflow account or if the registration of a withdrawal programme is consolidated referred to mixed offer points or consumption offer points referred to foreign virtual zones, an exposure is produced equal to the product between the quantities offered and the estimated CCT, taking into account the applicable VAT.

Once the PUN is known, the exposure is equal to the equivalent value of the CCT actually due, given by the product between the net quantity traded and the real unit value of the CCT, calculated as the difference between the zonal price and the PUN, and taking into account the applicable VAT. The credit positions, in this phase, define the possibility of offsetting the debt exposures that have the same settlement date.

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MANAGEMENT OF DEFAULTS

The guarantee system used on PCE provides that, in case of non-compliance, the financial guarantees provided by the participant are used as first-demand bank guarantees or non-interest-bearing deposits.

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