We have taken into account the suggestions and inquiries submitted by participants in the Exchange, as well disputes that arose within the course of the previous heating season. Now, having coordinated the draft Conditions of Trade in Biomass Products (hereinafter referred to as the Conditions of Trade), and the Typical Conditions of Supply of Biomass (hereinafter referred to as the Conditions of Supply) with the participants in the Exchange, the Energy Resource Exchange Operator has adopted the new versions of the Conditions of Trade and Conditions of Supply, which shall come into effect on 2nd August 2021.
Amendments to the Conditions of Trade:
- When submitting multiple orders for 70 MWh, they would be implemented only in full scope and only with the same orders, i.e., partial implementation of such orders or implementation with orders in the repeated quantity of 350 MWh shall not be allowed (e.g., if an order for purchasing 70 MWh is submitted, it would not be implemented with an order for sale of 140 MWh or 350 MWh and it would only be implemented with an order for sale of 70 MWh);
- The regulation for a minimum contract amount was revised by establishing that the minimum quantity per contract shall be 350 MWh repeatedly, which shall not exceed the maximum allowable quantity per minimum contract (per week): 1050 MWh (300 MWh in case of pellets) or 2100 MWh (600 MWh in case of pellets);
- A new non-standard trading condition has been established: “Termination of the contract in the event of no engagement in electricity generation activities”. It should be noted that this condition could be used only during the period when the buyer does not engage in electricity generation activities;
- An additional Incoterms 2020 FAS condition was added to trading in biomass at ports. It should be noted that it is still possible to trade normally on the Exchange under the Incoterms 2020 FAS condition by engaging in the standard biomass trading and without registering a trading site under the FAS condition.
Amendments to the Conditions of Supply:
- In order to facilitate implementation of the concluded contracts for purchase and sale of fuel, the Electronic Trading System (hereinafter referred to as the ETS) enables the participants in the Exchange to agree with the other party to the contract and to combine the contracts concluded by the same parties and concluded for the purpose of delivery of the same product for the same delivery period as well as to execute the combined contracts as a single contract;
- The start of deliveries under the one-quarter, half-year, and one-year biomass contracts continues to be associated with the start of the heating season, however, it was established that the end of the contracts would be determined in accordance with the Trading Calendar allowing the parties to come to an agreement;
- Prior to the municipal decision to start the heating season for all groups of heat consumers to whom the buyer supplies heat, the buyer shall be entitled to reduce the quantity of biomass to be delivered during a specific delivery week by submitting a Significant Information Notice;
- If the participant in the Exchange failed to submit the time reserved for acceptance of biomass at specific trading sites and (or) the installed capacity of installations using biomass there to the Operator, it shall be assumed that in this case the Operator would set the acceptance period on the ETS as being from 09:00 a.m. to 07:00 p.m.;
- In the process of automation of the ETS, it is established that the seller would be required to submit the results of quality tests of a reserve sample via the ETS and, in the event of failure to do so, the results of the quality tests of the principal sample would be confirmed automatically;
- A description of the procedure for comparison of the test results of the samples in an aggregate sample with the test result of the aggregate sample is provided.
- Terms for coordination of the Supply Schedule and notification to the other party were revised:
a. The standard supply schedule always applies;
b. The quantity under the contract may be changed unilaterally (due to weather conditions, start of the heating season, etc.) no later than 2 business days prior to the delivery period (usually by 12:00 a.m. on Wednesdays);
c. Upon failure to come to an agreement, a uniform supply schedule may be established no later than 1 business day prior to the delivery period (usually by 12:00 a.m. on Thursdays);
d. Adjustments to the supply schedule may be made by notifying this no later than 2 business days in advance.