ACER to decide on hedging opportunities between the Netherlands and Norway
What is it about?
On 16 August 2024, the National Regulatory Authority (NRA) of the Netherlands asked ACER to decide on how to address the insufficient risk hedging opportunities at the bidding zone border between the Netherlands and Norway.
Why is a decision needed?
The assessments performed by the Dutch and Norwegian NRAs found insufficient hedging opportunities in their respective bidding zones. Sufficient long-term hedging opportunities are important to allow market participants to be protected against price volatility risks and to mitigate uncertainty on future returns on investments.
To improve this, NRAs can:
- Request their Transmission System Operators to issue long-term transmission rights.
- Ensure the availability of other long-term cross-zonal hedging products that can support the wholesale electricity market functioning.
Since the NRAs could not reach an agreement, the decision was referred to ACER and the EFTA Surveillance Authority.
What are the next steps?
To inform its decision-making process, ACER will run a public consultation from today until 22 November and will take a decision on the referral from the Dutch NRA by 17 February 2025.
The EFTA Surveillance Authority will issue a decision for Norway, following the procedure outlined in the EEA Agreement.