The “Energy Transparency Award” (ETA) is an annual competition that aims to highlight the importance of transparency in European energy markets.

Transparency is an essential condition for the efficient functioning of energy markets. Not only transparent market rules, but also transparent access criteria to infrastructure, transparent operation of energy systems and transparent regulatory procedures are indispensable to ensure a level playing field and efficient market outcomes. The transition from national vertically-integrated monopolies to a single, unbundled and fully competitive European energy market has been a complex and prolonged process. Very often, the design of national and regional markets, the use of interconnectors and tariff setting decisions, to name only a few examples, have lacked the necessary transparency. Opacity is a major obstacle to the accomplishment of a truly integrated and efficient European energy market.

The “Energy Transparency Award”, to be assigned every year, will distinguish a company or institution for their particular contribution to the transparency of energy markets in Europe. The acronym of “Energy Transparency Award”, (ETA), is the seventh letter of the Greek alphabet, often used in technical and scientific formula to represent efficiency. Promoting the economic and technical efficiency of European energy markets through improved transparency is indeed the main purpose of the “Energy Transparency Award”.

Given the increasing importance of energy markets within Europe and the general ove towards larger, regional markets and exchanges, promoting transparency in physical and financial energy markets is an ideal way of stimulating the European economy and achieving an open and competitive European market. Transparency enhances information of market participants and permits them to take the more appropriate business decisions. Transparency gives more equal access to the market and more equal chance to benefit from market opportunities; it facilitates appropriate market entry. Hence transparency favours the efficiency of market operation and improves the confidence that economic agents may have with market outcomes.

The needed transparency in the energy markets is twofold: transparency of fundamental data and transparency of trading. Firstly, market participants can benefit from transparent fundamental data. They need to get a clear, easy to use and consistent set of fundamental data on infrastructure capacity and availability, on infrastructure contractual booking and effective usage. This has to be delivered at the right moment, at the right time and space scale and in the right format to become an information flow capable to feed market participants’ decisions. Second, market participants can benefit from a near to perfect transparency of trading. They need to have access to relevant pre-trade data (like bid and ask orders; etc) and post-trade data (like price / volume/ trading day & time; and bid – ask spread; etc.). Market monitors (like financial or energy regulators) too can enormously benefit from a well conceived and comprehensive market record keeping covering all the range of commercially sensitive and non sensitive information.

All markets should contribute to enlighten the energy market-based decisions: primary and secondary capacity markets; energy day-ahead and intraday; energy balancing; as well as futures, derivatives and related financial instruments. Organized markets should pave the way, either as pure independent PXs or explicit auctioning platforms of transmission capacity, or as PXs running an integrated energy and capacity implicit auctioning. OTC markets have no reason not to deliver a high level of transparency. Having got the bigger market share of the European energy market, they cannot stay apart and deliver only rare, grey and fuzzy information on market trading and market outcome.

Contributing to the transparency of European energy markets can have several forms, such as:

• Outstanding implementation of legal or voluntary transparency rules for fundamental or trading information, including the proper definition and conception of information delivery (like time scale and space scale; schedule of delivery; value added data and data comparisons, etc.); Information Technology tools and format used to deliver the relevant information; the way market participants are associated to the implementation process, etc.;
• Innovation going beyond the legal or voluntary transparency rules and offering new data or new types of information;
• Substantial innovation in the data recording, data handling, transfer and interactivity with users which substantially enhance the level and the scope of market transparency;
• Outstanding conception and management of market oversight inside the market platform to prevent and detect market abuse, non disclosure of sensible information, or inappropriate self-dealing;
• Outstanding harmonization and cooperation among market operators across several countries; notably to offer “seamless” trading platforms to market participants;

The Florence School of Regulation announces the “Energy Transparency Award” which is to be awarded every year in November in Brussels. The Florence School of Regulation will publish the call for proposals in newspapers, magazines and in the internet. Nominations for the “Energy Transparency Award” shall be submitted electronically to the Florence School of Regulation before end of July in order to be considered for the “Energy Transparency Award” in the relevant calendar year.

In order to enter for the “Energy Transparency Award”, nominations may be presented by any “Third Party” organization or individual. These Third Parties define the set of possible candidates to the Award. The Award may be assigned to any undertaking, institution, industry association, system or market operator within the geographic region of the Council of Europe. Nominations cannot concern individuals.

In order to submit a nomination for the “Energy Transparency Award” it is required that the Third Party nominating a possible candidate fills out the electronic registration. The registration form can be found at the FSR website http://fsr.eui.eu and shall provide:

A limited number of annexed documents can be included. If those are in an original language other than English a brief while comprehensive summary in English should be provided.

The documents submitted for the Award will not be returned to the nominating entities who will not receive any fees or rights for public communication or exploitation of the material selected. Entering the Award through a nomination, entails the acceptance of all the conditions specified in these rules.

The applications shall be submitted in English. The completed registration form obtained through the FSR website http://fsr.eui.eu and the specified documents must be sent online.

The applications submitted by nominating entities to the “Energy Transparency Award” must show they reach excellence in one or several of the following aspects:

• Implementation of the existing voluntary or mandatory rules
• Innovation to go beyond the scope of existing rules
• Innovation in the conception and management of the information technology standards and tools
• Innovation enhancing the market oversight inside the trading platform
• Harmonization and cooperation across countries and at the regional level

The criteria that will govern selection of the applications presented for the “Energy Transparency Award” are:

• In priority (4 criteria weighted 15% each) - effectiveness, - efficiency, - reproducibility, - innovation;
• Attention will also be paid to (4 criteria weighted 10% each): - simplicity of design and implementation, - responsiveness to users’ need, - leverage, - contribution to market oversight improvement.

Applications may argue for each of these eight criteria.

The Selection Committee will only take into account those applications that comply with all the conditions of participation. Each nomination will be evaluated by each member of the Committee. The 3 nominations with the highest average marks are then reviewed again by all members of the Committee and the one with the highest average mark wins.

As long as the “Energy Transparency Award” is not funded by more than five financing bodies, the financing bodies are excluded from being the winner of the Award.

The organisers reserve the right to cancel the competition at any time. If this happens, participants will be individually informed as soon as possible.

The Selection Committee of the “Energy Transparency Award” is formed by a president and at least three members of widely recognised independence and international prestige, appointed by the president of the Selection Committee. The president of the Selection Committee is Jorge Vasconcelos, founding chairman of the Council of European Energy Regulators. Any successor of the president will beselected by RWE as long as RWE is the sole financing body of the “Energy Transparency Award”. If further financing bodies subscribe the Fund (see Clause 11 below), all financing bodies have to agree on the president’s successor.

Secretariat functions will be performed by the Florence School of Regulation, Robert Schuman Centre for Advanced Studies, European University Institute, Florence (Italy) which notably will assist the Selection Committee and prepare the minutes of their meetings sessions. The meetings and deliberations of the Selection Committee will take place in Brussels, in Florence or in any other place agreed by the Committee. The decision of the Selection Committee will be communicated to the winners and will appear on the website of the Florence School of Regulation http://fsr.eui.eu. The prize-giving ceremony is to be held every year in November in Brussels.

The “Energy Transparency Award” is honorary by nature. The winner of the prize will receive a diploma attesting to the award. The winner, the finalists and a selection of applications that have been presented will be published on the webpage of the Florence School of Regulation http://fsr.eui.eu.

The Selection Committee will publish a written statement explaining the outstanding contribution of the Award winner.

The Selection Committee will also approve the annual report on progress made in improving the transparency of European energy markets. This report will be prepared by the Florence School of Regulation.

The Award will be financed by a Fund. RWE is the first financing body to subscribe the Fund; however, the Fund is open to any company or institution wishing to contribute to the increased transparency of European energy markets. The Fund will be managed by the Florence School of Regulation at the European University Institute according to the public rules governing the European University Institute. The Fund is used to cover all costs, including advertisement of the Award (call for proposals in newspapers, magazines, internet, etc.), reception and management of the nominations, selection of nominations (fees and travelling expenses for members of the Selection Committee), design and manufacture of the award, advertisement of the winner, travelling expenses for the winner from their respective location to Brussels and organization of the annual meeting/dinnerdebate.

15^th May 2012
Opening of period for presenting nominations

Ms. Angela Conte
Florence School of Regulation
European University Institute
Villa Malafrasca
Via Boccaccio 151, 50133 Firenze, Italy

Tel: +39 328 286 22 33
email: transparency.award@eui.eu
http://www.florence-school.eu