Implementation of negative prices starting from February 1st, 2012

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OKTE, a.s. announces to the market participants an implementation of negative prices nomination on day-ahead electricity market in Slovak Republic. The implementation will have been done in cooperation with Czech market operator OTE, a.s. from the trading day February 1st, 2012. Market participants will be able to enter prices in their orders for purchase and sale of electricity in the range of -3 000,00 EUR/MWh to +3 000,00 EUR/MWh in the system XMtrade/ISOT starting from January 31st, 2012 for trading day of February 1st, 2012. Current prices range from 0,01 EUR/MWh to 4 000,00 EUR/MWh is valid for all orders only up to trading day of January 31st, 2012. All electricity sale orders at negative price will be compared against market participant's available financial guarantee.

Zero or negative marginal price can occur by matching orders in some specific trading hours starting from February 1st, 2012. By statement of Tax Directorate of the Slovak Republic dated October 4th, 2011, electricity trading at negative prices represents services of recipient to provider of electricity. The sale of electricity at zero price has a character of delivery of goods that is considered as a free of charge by the electricity provider. By statement of the Customs Directorate of the Slovak Republic dated June 28th, 2011, the subject to the excise taxation in case of chargeability is total volume of sold electricity at positive, zero and negative prices. The excise tax on electricity sold at negative prices is not subject to VAT.

The daily settlement of DAM will be based on the daily confirmation of assets and liabilities by OKTE, a.s. including payments for purchase and sale of electricity at negative prices. The monthly billing of DAM will be executed by two separate billing invoices for delivery of goods and supply of service based on monthly confirmation issued by OKTE, a.s. The monthly billing invoices for supply of service will be issued by every market participant, who has purchased electricity in any trading hours with a negative marginal price. Excise tax on electricity sold at negative prices to market participant will be settled in the monthly billing invoice for delivery of goods issued by OKTE.

Example of XMtrade/ISOT documents as well as statements of the Tax Directorate of the Slovak Republic and Customs Directorate of the Slovak Republic about tax treatment (both in Slovak language) can be found in attachment of this announcement.

The web service EVALUATIONS of the XMtrade/ISOT for results and evaluation of DAM has been extended in the context of the implementation of negative prices on DAM. Updated Technical specification of ISOT external interfaces is also enclosed as an attachment.


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