Single allocation platform: set of requirements and methodology for sharing costs related to its establishment and operation

What is it about?

These rules and procedures address the single allocation platform’s functional requirements, governance, liabilities and cost sharing. The single allocation platform performs the execution of the long-term auctions in accordance with the harmonised allocation rules and any additional tasks required for the provision of long term transmission rights. All TSOs appointed the Joint Allocation Office (JAO) as the single allocation platform.

Legal basis: Article 49(1) and Article 59 of the FCA Regulation

Responsibility: all Transmission System Operators (TSOs)

Current status: The set of requirements and the methodology for sharing the costs of establishing, developing and operating the single allocation platform were approved by all regulatory authorities in September 2017.

Implementation: The single allocation platform is established and operating. The cost sharing methodology is implemented.

Read more on the latest approved single allocation platform methodology.

Documentation on the approval process of this methodology.

​​The development of the FCA Regulation started in 2011 when the Agency developed the Framework Guidelines on Capacity Allocation and Congestion Management  for electricity. These framework guidelines were adopted on 29 July 2011.     

Among other elements, the Framework Guidelines included provisions for the forthcoming development of the Network Code on Forward Capacity Allocation. The core of these requirements was centred around forward capacity allocation based on explicit auctions in a form of Physical or Financial Transmission Rights allocated based on harmonised allocation rules and through single allocation platform. Other elements included requirements on the firmness of long term cross-zonal capacities, efficient definition of bidding zones as well as efficient and coordinated capacity calculation in forward timeframe.

Based on these Framework Guidelines, ENTSO-E was tasked to develop the Network Code on Forward Capacity Allocation. Subsequently, the draft network code was submitted to the Agency for opinion based on which ENTSO-E revised the network code and resubmitted it to the Agency. Finally, the Agency adopted a recommendation to the European Commission to adopt the Network Code on Forward Capacity Allocation subject to specific amendments proposed by the Agency. Following this recommendation, the European Commission also revised the network code, which was then finally adopted as a Commission guideline in September 2016 and entered into force in October 2016.​

The detailed dates and documents of the above actions are presented below:

Action 1: 29 July 2011: The Agency adopts the Framework Guidelines on Capacity Allocation and Congestion Management for Electricity

Action 2: 1 October 2013: ENTSO-E submits the Network Code on Forward Capacity Allocation to the Agency

Action 3: 18 December 2013: The Agency adopts the Opinion on the Network Code on Forward Capacity Allocation

Action 4: 3 April 2014: ENTSO-E resubmits the amended Network Code on Forward Capacity Allocation to the Agency

Action 5: 22 May 2014: The Agency adopts the Recommendation on the Network Code on Forward Capacity Allocation

​​​​​​Development and amendments to EB Regulation

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The EB Regulation has been developed in close cooperation with the Agency, ENTSO-E and stakeholders, in order to adopt effective, balanced and proportionate rules in a transparent and participative manner. In accordance with Article 18(3) of Regulation (EC) No 714/2009, the Commission will consult the Agency, ENTSO-E and other relevant stakeholders, before proposing any amendment to EB Regulation.

Development of terms and conditions or methodologies

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Every proposal for the terms and conditions or methodologies should be submitted to public consultation before its submission for regulatory approval, in accordance with Article 10 of the EB Regulation. The entities responsible for performing the consultation should duly consider the views of stakeholders resulting from the consultation, prior to its submission for regulatory approval. In all cases, a clear and robust justification for including or not the views resulting from the consultation should be developed and published in a timely manner before or simultaneously with the publication of the respective proposal.

Implementation of EB Regulation

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Market European Stakeholder Committee (MESC): Pursuant to Article 9 of the EB Regulation, the Agency, in close cooperation with ENTSO-E, has established the Market European Stakeholder Committee (MESC), in order to organise stakeholder involvement regarding general aspects of the implementat​ion of the EB Regulation and holds regular meetings with stakeholders to identify problems and propose improvements notably related to the integration of electricity balancing market.

Details on the activities of MESC

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Electricity Balancing Stakeholder Group (EBSG): Pursuant to Article 9 of the EB Regulation, the Agency, in close cooperation with ENTSO-E, has also established the Electricity Balancing Stakeholder Group (EBSG), in order to organise specific stakeholder involvement regarding the implementation of EB Regulation. EBSG holds regular meetings with stakeholders to identify problems and propose improvements related to the integrated electricity balancing market.

Details of the activities of EBSG

​​​The EB Regulation sets out certain obligations for TSOs, ENTSO-E, DSOs, regulatory authorities and the Agency regarding the development and approval of terms and conditions or methodologies. Articles 4 and 5 describe the process of adoption of these terms and conditions or methodologies submitted by the TSOs, which are divided into three categories: the ones subject to all regulatory authorities' approval, in accordance with Article 5(2), the ones subject to the approval of the regulatory authorities of a concerned region, in accordance with Article 5(3), and the ones subject to the approval of each regulatory authority of each Member State on a case by case basis, in accordance with Article 5(4).

A proposal by TSOs should typically be consulted upon in accordance with Article 10 and according to Article 5(5) submitted to the concerned regulatory authorities and to the Agency and should contain a timescale for implementation and the expected impact on the objectives of the EB Regulation as referred to in Article 3. The implementation timescale shall not be longer than twelve months after the approval by the relevant regulatory authorities, except where all relevant regulatory authorities agree to extend the implementation timescale or where different timescales are stipulated in the EB Regulation. The concerned regulatory authorities should take decisions concerning the proposed terms and conditions or methodologies within six months after receipt of the proposal. Where the regulatory authorities were not able to reach unanimous agreement on the approval of the proposal, they can request an amendment, which gives the TSOs extra two months for amending the proposal and another two months for the regulatory authorities to approve the amended proposal. If, in either case, the regulatory authorities were not able to reach unanimous agreement or upon their joint request, the Agency shall adopt a decision within six months from the referral.

After the adoption of the terms and conditions or methodologies TSOs responsible for developing the respective proposals or regulatory authorities responsible for their adoption, may request amendments of these terms and conditions or methodologies, in accordance with Article 6(3). In that case the proposals for amendment to the terms and conditions or methodologies shall be submitted to consultation and follow the approval procedure as described above.​​​
 

EU-wide TSO-TSO settlement rules for the intended exchanges of energy

What is it about?

All TSOs participating in the European balancing platforms have to implement the common settlement rules for the exchange of energy. These rules define the methodology to determine the settlement amounts of all intended exchanges of balancing energy resulting from the replacement reserves process, the frequency restoration process with manual and automatic activation and the imbalance netting process.

They also define how the settlement amounts and balancing congestion incomes are distributed among the TSOs.

Legal basis: Article 50(1) of the EB Regulation

Responsibility: all TSOs

Current status: The common settlement rules were approved by ACER in July 2020.

Implementation: Each TSO shall apply the relevant provisions of the common settlement rules once they participate in the European balancing platform for the exchange of balancing energy or the operation of the imbalance netting process. The TSOs participating in the replacement reserve platform shall implement and apply these common settlement rules by 1st July 2022.

Read more on the latest approved common TSO-TSO settlement rules for the intended exchanges of energy.

Documentation on the approval process of the settlement rules.

TSO-TSO settlement rules for the intended exchange of energy within a synchronous area

What is it about?

These rules determine the high-level design principles of the common settlement rules, settlement amounts and prices for all intended exchanges of balancing energy resulting from the frequency containment process and ramping period.

Legal basis: Article 50(3) of the EB Regulation

Responsibility: all TSOs intentionally exchanging energy within a synchronous area

Current status: The common settlement rules of the continental Europe and Nordic synchronous areas were approved by relevant regulatory authorities in June 2020. 

Implementation: The approved rules are implemented.

Read more on the latest approved TSO-TSO settlement rules for the intended exchange of energy within a synchronous area.

Documentation on the approval process of these rules.

TSO-TSO settlement rules for the intended exchange of energy for all asynchronously connected TSOs

What is it about?

These rules determine the high-level design principles of the common settlement rules, the settlement amounts and prices for all intended balancing energy’s exchanges of asynchronously connected TSOs resulting from the frequency containment process for active power output and ramping restrictions.

Legal basis: Article 50(4) of the EB Regulation

Responsibility: all asynchronously connected TSOs intentionally exchanging energy between synchronous area

Current status: The common settlement rules were approved by relevant regulatory authorities in June 2020. 

Implementation: The approved rules are implemented.

Read more on the latest approved TSO-TSO settlement rules for the intended exchange of energy for all asynchronously connected TSOs.

Documentation on the approval process of these rules.

TSO-TSO settlement rules for the unintended exchange of energy for each synchronous area

What is it about?

These rules determine the high-level design principles of the common settlement rules, the settlement amounts and prices of all balancing energy’s unintended exchanges within a synchronous area.

Legal basis: Article 51(1) of the EB Regulation

Responsibility: all TSOs of a synchronous area

Current status: The common settlement rules applicable to all unintended energy exchanges have been approved:

• in April 2020 within the Baltic and Nordic synchronous areas

• in June 2020 within the Continental Europe synchronous area

Implementation: The rules are implemented.

Read more on the latest approved TSO-TSO settlement rules for the unintended exchange of energy for each synchronous area.

Documentation on the approval process of these rules.

TSO-TSO settlement rules for the unintended exchange of energy for all asynchronously connected TSOs

What is it about?

These rules determine the high-level design principles of the common settlement rules, the settlement amounts and prices of all balancing energy’s unintended exchanges of asynchronously connected TSOs.

Legal basis: Article 51(2) of the EB Regulation

Responsibility: all asynchronously connected TSOs

Current status: The common settlement rules applicable have been approved by relevant regulatory authorities in January 2020.  

Implementation: The rules are implemented.

Read more on the latest approved TSO-TSO settlement rules for the unintended exchange of energy for all asynchronously connected TSOs.

Documentation on the approval process of these rules.

Harmonisation of the main features of imbalance settlement

What is it about?

Each Transmission System Operator (TSOs) calculates the overall imbalance for every responsible party in its imbalance area, and defines its price according to the national rules. However, all TSOs are required to harmonise the main features of the imbalance settlement through the application of this methodology. These include:

• calculation of the imbalance (including its position, the allocated volume and the imbalance adjustment)

• main components for calculating the imbalance price

• use of single and dual imbalance pricing

Following the adoption of this methodology, all TSOs are required to amend their national terms and conditions for balance responsible parties.

Legal basis: Article 52(2) of the EB Regulation

Responsibility: all TSOs

Current status: The methodology was approved by ACER in July 2020.

Implementation: All TSOs should implement the methodology by January 2022.

Read more on the latest approved methodology for further specifying and harmonising the imbalance settlement.

Documentation on the approval process of this methodology.

Application of an allocation process of cross-zonal capacity

What is it about?

Two or more TSOs exchanging balancing capacity need to ensure the overall availability of the cross-zonal capacity for the exchange of balancing capacity. This can be done through the allocation of cross-zonal capacity for the exchange of balancing capacity or for sharing of reserves.

There are three different processes for allocating cross-zonal capacity:

• co-optimised allocation process (Article 40)

• market-based allocation process (Article 41)

• allocation process based on economic efficiency analysis (Article 42).

If TSOs opt for applying one of these processes, they need to further specify the relevant bidding zone borders, the timeframe and the duration of the application of the respective methodology.

Legal basis: Article 38(1) of the EB Regulation

Responsibility: two or more TSOs are allowed to apply the methodology for cross-zonal capacity allocation process for the exchange of balancing capacity or sharing of reserves.

Current status: The proposal for the application of the methodology  from frequency restoration reserves with automatic activation submitted by the TSOs of Denmark, Finland and Sweden was approved by ACER in August 2020.The proposal for the application of the methodology for frequency containment reserves and frequency restoration reserves for the Baltic capacity calculation region (Baltic balancing capacity market), submitted by the TSOs of Estonia, Latvia and Lithuania, was approved by the Baltic regulatory authorities in February 2024.

Implementation: The methodology for the Nordic capacity calculation region has been implemented with the go-live of the capacity calculation methodology, according to the CACM Regulation. The methodology for the Baltic capacity calculation region will be implemented once the capacity calculation methodology for the Baltic capacity calculation region is applied according to the CACM Regulation.

Read more on the latest approved proposals for the application of a methodology for a cross-zonal capacity allocation process for the exchange of balancing capacity or sharing of reserves.

Documentation on the approval process of these proposals.

Harmonisation of the methodology for allocating cross-zonal capacity for the exchange of balancing capacity or sharing of reserves

What is it about?

This methodology provides a harmonised approach for the processes of allocating cross-zonal capacity for the exchange of balancing capacity or sharing of reserves, which can be applied by any group of TSOs.

The methodology fosters the optimisation of the allocation process and concerns the co-optimised and the market-based allocation process (Article 40 and 41 of the EB Regulation).

The methodology will replace the regional methodologies for allocating cross-zonal capacity to the balancing timeframe.

Legal basis: Article 38(3) of the EB Regulation

Responsibility: all TSOs

Current status: The harmonised cross-zonal capacity allocation methodology was approved by ACER in July 2023. A proposal for amendment was submitted by TSOs on 31 July 2024. After consulting with stakeholders, ACER reviewed the TSOs’ proposal and adopted the amended methodology on 29 January 2025 (Decision 01-2025).

Implementation: The harmonised market-based process is expected to be fully implemented by September 2027 at the earliest. The implementation deadline of the co-optimised allocation process is defined in the single day-ahead coupling algorithm methodology (Article 37 of the Capacity Allocation and Congestion Management Regulation).

Access the latest approved methodology for harmonising processes for allocating cross-zonal capacity for the exchange of balancing capacity or sharing of reserves.

Documentation on the approval process of this methodology:

• TSO proposal for the harmonised methodology for cross-zonal capacity allocation for the exchange of balancing capacity or sharing of reserves (16 December 2022);
• TSO proposal for the Regional Coordination Centres' (RCCs') tasks of regional sizing of reserve capacity (17 March 2023); 
• TSO proposal for the RCCs' tasks of facilitating the procurement of electricity balancing capacity (17 March 2023)
• ACER Decision No 11-2023 on the TSOs’ proposal for the harmonised cross-zonal capacity allocation methodology (19 July 2023);
• ACER Decision No 12-2023 on the Regional Coordination Centre Regional Sizing of Reserve Capacity Methodology (19 July 2023); and
• ACER Decision No 13-2023 on the Regional Coordination Centre Regional Procurement of Balancing Capacity Methodology (19 July 2023).
• TSO proposal for the amendment of the harmonised methodology for cross-zonal capacity allocation for the exchange of balancing capacity or sharing of reserves (31 July 2024).
• ACER Decision 01-2025 on the amendment to the harmonised cross-zonal capacity allocation methodology (29 January 2025).

Methodology for a co-optimised allocation process of cross-zonal capacity

What is it about?

The co-optimised allocation process is based on a comparison of actual market values of cross-zonal capacity for the exchange of energy and of balancing capacity or sharing of reserves. Its methodology describes the associated rules for allocating cross-zonal capacity across timeframes.

The market values is based on the bids of market participants, submitted for day-ahead energy and balancing capacity markets.

The cross-zonal capacity will be allocated across the balancing and day-ahead timeframe to maximise the combined overall welfare gains.

Legal basis: Article 40(1) of the EB Regulation

Responsibility: all TSOs

Current status: The methodology for a co-optimised allocation process was approved by ACER in June 2020.

Implementation: The implementation is on-going.

All TSOs are currently conducting an impact assessment for the implementation of the co-optimised allocation process and will provide the relevant requirements for the singe day-ahead coupling algorithm to Nominated Electricity Market Operators (NEMOs).

NEMOs need to consider this implementation when submitting amendments of the single day-ahead coupling algorithm methodology (Article 37 of the Capacity Allocation and Congestion Management Regulation).

Read more on the latest approved methodology for a co-optimised allocation process.

Documentation on the approval process of this methodology.

Methodology for a market-based allocation process of cross-zonal capacity

What is it about?

The market-based allocation process is based on a comparison of market values of cross-zonal capacity for the day-ahead and  balancing timeframe. Its methodology establishes the rules for allocating cross-zonal capacity for the exchange of balancing capacity or sharing of reserves.

While one of the two market values is based on the bids of market participants, the second one is based on a forecast. The cross-zonal capacity is then allocated across the balancing and energy timeframe with the aim of maximising the expected combined overall welfare gains.

Legal basis: Article 41(1) of the EB Regulation

Responsibility: all TSOs in each capacity calculation region

Current status: Methodologies for a market-based allocation process were approved for the Baltic, Core, GRIT, Italy North and Nordic capacity calculation regions.

Implementation: Different regions have different implementation timelines. Some regions have already implemented the methodology, whereas some other are expected to do so by 2025.

Read more on the latest approved methodologies for a market-based allocation process of the respective capacity calculation region.

Documentation on the approval processes of the methodologies for a market-based allocation process of each capacity calculation region.

Methodology for an allocation process of cross-zonal capacity based on economic efficiency analysis

What is it about?

The allocation process is based on a comparison of forecasted market values of cross-zonal capacity for the exchange of energy,  balancing capacity or sharing of reserves. Its methodology describes the rules for allocating cross-zonal capacity across timeframes.

The cross-zonal capacity will be allocated across the balancing and energy timeframe to maximise the expected combined overall welfare gains.

Legal basis: Article 42(1) of the EB Regulation

Responsibility: all TSOs in each capacity calculation region

Current status: Methodologies were submitted for the Core, Greece-Italy (GRIT) and Italy North capacity calculation regions.  Core and Italy North were withdrawn during the approval process, while GRIT was approved.

Implementation: No implementation is foreseen.

Read more on the latest approved methodologies for a market-based allocation process of the respective capacity calculation region.

Documentation on the approval processes of the methodologies for a market-based allocation process of each capacity calculation region.

Rules and processes for the exchange and procurement of balancing capacity

What is it about?

Transmission System Operators (TSOs) procure the balancing capacity needed at national level. However, to lower the procurement costs, TSOs may opt for exchanging balancing capacity with other TSO(s).

In this case, TSOs  need to develop the rules and processes for the common procurement of balancing capacity, including the specification of the standard product(s) for balancing capacity (Article 25(2)) they intend to exchange, taking into account the available cross-zonal capacity (Article 38(1)) and the operational limits.

Legal basis: Article 33(1) and Article 34(1) of the Electricity Balancing Regulation

Responsibility: two or more TSOs exchanging or mutually willing to exchange balancing capacity

Current status: So far three groups of TSOs have developed rules and processes for the exchange and procurement of balancing capacity:

• The Frequency Containment Reserves (FCR Cooperation), together with the exemption for transferring the balancing capacity obligations, were approved by the regulatory authorities of Austria, Belgium, France, Germany, Denmark and The Netherlands in December 2018

• The Frequency Restoration Reserves with automatic activation (Nordic aFRR market), together with the exemption for transferring the balancing capacity obligations submitted by the TSOs of Denmark, Finland and Sweden, was approved by ACER in August 2020.

• The Frequency Containment Reserves and Frequency Restoration Reserves for the Baltic capacity calculation region (Baltic balancing capacity market), submitted by the TSOs of Estonia, Latvia and Lithuania, was approved by the Baltic regulatory authorities in February 2024.

Implementation: The FCR Cooperation is operational and expanding. The common rules and processes for the Nordic aFRR market have been implemented with the go-live of the capacity calculation methodology for the Nordic capacity calculation region, according to the CACM Regulation. The common rules and process for the Baltic balancing capacity market will be implemented once the capacity calculation methodology for the Baltic capacity calculation region is applied according to the CACM Regulation.

Read more on the latest approved rules and processes for the exchange and procurement of balancing capacity.

Documentation on the approval process of these methodologies.

Standard products for balancing capacity

What is it about?

Each TSO may develop specific products for its national procurement of balancing capacity. However, when two or more TSOs exchange balancing capacity, they are required to use standard balancing capacity products from a list developed by all TSOs.

This list defines the characteristics of the standard products for each type of reserve:

• Replacement reserves

• Frequency restoration reserves with manual activation

• Frequency restoration reserves with automatic activation, including the validity period and the minimum duration between the end of deactivation period and the following activation.

Legal basis: Article 25(2) of the EB Regulation

Responsibility: all TSOs

Current status: The list of standard products for balancing capacity was approved by ACER in June 2020.

Implementation: Each TSO intending to use standard balancing capacity products should implement this methodology by December 2021.

Read more on the latest approved list of standard products for balancing capacity.

Documentation on the approval process of this methodology.