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General Rules for the Electricity Market

Balancing markets

The settlement of balancing energy for standard balancing products and specific balancing products shall be based on marginal pricing (pay-as-cleared).

Market participants shall be allowed to bid as close to real time as possible, and balancing energy gate closure times shall not be before the intraday cross-zonal gate closure time.

The procurement of balancing capacity shall be market-based and organised in such a way as to be non-discriminatory between market participants in the prequalification process.

Day-ahead and intraday markets

Once NEMOs are designated in accordance with CACM, NEMOs shall allow market participants to trade energy as close to real time as possible and at least up to the intraday cross-zonal gate closure time.

By 1 January 2023, the imbalance settlement period shall be 15 minutes in all scheduling areas, unless regulatory authorities have granted a derogation or an exemption. Derogations may be granted only until 31 December 2026.

Forward markets

Long-term transmission rights shall be allocated in a transparent, market based and non-discriminatory manner through a single allocation platform.

Redispatching

Redipatching shall be open to all generation technologies, all energy storage and all demand response, including those located in other Member States or Contracting Parties unless technically not feasible.

The resources that are redispatched shall be selected using market-based mechanisms and shall be financially compensated.

Non-market based redispatching may only be used under specific circumstances like insufficient competition or regular and predictable congestions in the area concerned.

Where non-market downward redispatching is used renewable sources shall only be dispatched if no other solutions exist or other solutions would lead to disproportionate costs or risks to network security.

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Congestion Management

Bidding zone review

When reporting on structural congestions in accordance with CACM ENTSO-E shall extend this report to include CPs (including whether 70% pursuant to Art. 16 or linear trajectory pursuant to Art.15 was reached) 

A bidding zone review shall be carried out for the Contracting Parties for bidding zones in the same capacity calculation region established in accordance with Article 15 of CACM, at the latest six months following the first report by the ENTSO-E in accordance with the provision above, but not later than 31 December 2025.

Where structural congestion has been identified, the CP shall in cooperation with its TSOs decide, within six months of the receipt of the report, either to establish national or multinational action plans pursuant to Article 15, or to review and amend its bidding zone configuration.

For those CPs that have opted to amend the bidding zone configuration, the relevant CPs in the same capacity calculation shall reach a unanimous decision within six months. The decision shall be reasoned and shall be notified to the Energy Community Secretariat and the Energy Community Regulatory Board. In the event that the relevant Contracting Parties fail to reach a unanimous decision within those six months, they shall immediately notify the Energy Community Regulatory Board thereof. As a measure of last resort, the Energy Community Regulatory Board and after consulting the Energy Community Secretariat, shall adopt a decision whether to amend or maintain the bidding zone configuration in and between those Contracting Parties by six months after receipt of such a notification.

Contracting Parties which have decided to develop an action plan shall do so in cooperation with their regulatory authorities. That action plan shall contain a concrete timetable for adopting measures to reduce the structural congestions identified within four years.

Under the action plan Contracting Parties need to ensure that cross-zonal trade capacity is increased on an annual basis until the minimum 70 % cross-zonal capacity rule provided for in Electricity Regulation is reached. That minimum capacity shall be reached by 31 December 2027.

The relevant transmission system operators shall on an annual basis, during the implementation of the action plan and within six months of its expiry, assess for the previous 12 months whether the available cross-border capacity has reached the linear trajectory or, from 1 January 2028, the minimum 70 % capacities have been achieved. They shall submit their assessments to the Energy Community Regulatory Board and to the relevant regulatory authorities. 

For those Contracting Parties for which the assessments demonstrate that a transmission system operator has not complied with the linear trajectory, the relevant Contracting Parties shall, within six months of receipt of the assessment report, decide unanimously whether to amend or maintain the bidding zone configuration within and between those Contracting Parties. The relevant Contracting Parties‘ decision shall be substantiated and shall be notified to the Energy Community Secretariat and the Energy Community Regulatory Board.

The relevant Contracting Parties shall notify the Energy Community Secretariat immediately if they fail to reach a unanimous decision within the timeframe laid down. Within six months of receipt of such notification, the Energy Community Secretariat, as a last resort and after consulting the Agency for the Cooperation of Energy Regulators, the Energy Community Regulatory Board and the relevant stakeholders shall adopt a decision whether to amend or maintain the bidding zone configuration in and between those Contracting Parties.

Six months before the expiry of the action plan, the Contracting Parties with identified structural congestion shall decide whether to address remaining congestion by amending its bidding zone or whether to address remaining internal congestion with remedial actions for which it shall cover the costs.

General principles of capacity allocation and congestion management

Transaction curtailment procedures shall be used only in emergency situations, namely where the transmission system operator must act in an expeditious manner and redispatching or countertrading is not possible. Any such procedure shall be applied in a non-discriminatory manner. Except in cases of force majeure, market participants that have been allocated capacity shall be compensated for any such curtailment.

The maximum level of interconnector capacity and the transmission networks affected by cross-border trade, between Parties to the Energy Community shall be made available to market participants complying with the safety standards of secure network operation. Counter-trading and redispatch, shall be used to maximise available capacities to reach the minimum 70 % capacity. A coordinated and non-discriminatory process for cross-border remedial actions shall be applied to enable such maximisation, following the implementation of a redispatching and counter-trading cost-sharing methodology.

Capacity shall be allocated by means of explicit capacity auctions or implicit auctions including both capacity and energy. Both methods may coexist on the same interconnection. For intraday trade, continuous trading, which may be complemented by auctions, shall be used.

Transmission system operators shall not limit the volume of interconnection capacity to be made available to market participants as a means of solving congestion inside their own bidding zone. The following minimum levels of available capacity for cross-zonal trade shall be reached:

  • for borders using a coordinated net transmission capacity approach, the minimum capacity shall be 70 % of the transmission capacity respecting operational security limits after deduction of contingencies;

  • for borders using a flow-based approach, the minimum capacity shall be a margin set in the capacity calculation process as available for flows induced by cross-zonal exchange. The margin shall be 70 % of the capacity respecting operational security limits of internal and cross-zonal critical network elements, taking into account contingencies.

At the request of the transmission system operators in a capacity calculation region, the relevant regulatory authorities may grant a derogation from the minimum capacity levels on foreseeable grounds where necessary for maintaining operational security. Such derogations, shall be granted for no more than one-year at a time, or, provided that the extent of the derogation decreases significantly after the first year, up to a maximum of two years.

Where a derogation is granted, the relevant transmission system operators shall develop and publish a methodology and projects that shall provide a long-term solution to the issue that the derogation seeks to address. 

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Resource Adequacy

ENTSO-E shall include the Contracting Parties in the annual European resource adequacy assessment, which shall identify resource adequacy concerns by assessing the overall adequacy of the electricity system to supply current and projected demands for electricity at European level, at the level of the Member States and Contracting Parties.

Contracting Parties with identified resource adequacy concerns shall develop and publish an implementation plan with a timeline for adopting measures to eliminate any identified regulatory distortions or market failures and submit it to the competent national State aid authority when notifying a capacity mechanism as well as to the Energy Community Secretariat. When addressing resource adequacy concerns, the Contracting Parties shall in particular take into account the following principles:

  • Removing regulatory distortions

  • Removing price caps

  • introducing a shortage pricing function for balancing energy as referred to in Article 44(3) of Regulation (EU) 2017/2195

  • increasing interconnection and internal grid capacity

  • enabling self-generation, energy storage, demand side measures and energy efficiency by adopting measures to eliminate any identified regulatory distortions;

  • ensuring cost-efficient and market-based procurement of balancing and ancillary services;

  • removing regulated prices where required by Article 5 of Directive (EU) 2019/944.

The Contracting Parties concerned shall submit their implementation plans to the Energy Community Secretariat for review. Within four months of receipt of the implementation plan, the Energy Community Secretariat shall issue an opinion on whether the measures are sufficient to eliminate the regulatory distortions or market failures that were identified, and may invite the Contracting Parties to amend their implementation plans accordingly. The Contracting Parties concerned shall monitor the application of their implementation plans and shall publish the results of the monitoring in an annual report and shall submit that report to the Energy Community Secretariat. The Energy Community Secretariat shall issue an opinion on whether the implementation plans have been sufficiently implemented and whether the resource adequacy concern has been resolved.

Capacity mechanisms can be introduced as last resort measure to eliminate residual resource adequacy concerns.  CPs shall not introduce capacity mechanisms before an opinion on implementation plan is received from the EnCS or in absence of identified adequacy concern from the European or national assessments. CPs shall assess whether a strategic reserve is capable of addressing the adequacy concerns, only where this is not the case CPs may implement a different type of CMs. Capacity mechanisms shall be temporary. They shall be approved by the competent national State aid authority, upon informing the Energy Community Secretariat, no longer than 10 years. Clear emission limits (no more than 550g of CO2 per kWh of electricity from date of EIF of this regulation) for generation contracted under the capacity mechanism.

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Transmission System Operation

Transmission system operators shall cooperate at Energy Community level through ENTSO-E, in order to promote the completion and functioning of the internal market for electricity and cross-zonal trade and to ensure the optimal management, coordinated operation and sound technical evolution of the European electricity transmission network.

Transmission system operators shall establish regional cooperation, to the extent possible, within the ENTSO for Electricity. In particular, they shall publish a regional investment plan biennially.

Within six months upon the establishment of a system operation region, each transmission system operator shall participate in any of the regional coordination centres (RCCs):

  • The Regional Coordination Centres in Thessaloniki, Greece,  Belgrade, Serbia or Munich, Germany shall assume the roles of RCCs for the Shadow South-East Europe System Operation Region (Shadow SEE SOR).

  • The Regional Coordination Centres for the Eastern Europe System Operation Region (EE SOR) shall be the RCC for the Central Europe SOR.

The transmission system operators of a system operation region defined by Annex V shall participate in the regional coordination centre defined by Annex IV.

  • System operation regions Shadow South-East Europe (AL, BA, KS, ME, MK, RS) and Eastern Europe (UA, MD)

Within 6 months both RCCs (RCC Shadow SEE SOR and RCC EE SOR) are expected to submit an implementation plan for the entry into operation of the RCCs including statutes and rules of procedure, and organisational, financial and operational arrangements necessary.