Congratulations to Clara Poletti (Commissioner at ARERA, Italy) and Rafał Gawin (President at URE, Poland) for being re-elected as Chair and Vice-Chair respectively of the ACER Board of Regulators (BoR).

We look forward to continuing working with you to advance the European energy market and achieving the decarbonisation targets. Thank you for your commitment over the past years to the work of the energy regulatory community!

About the BoR

The BoR is in charge of the regulatory policy of the Agency and plays a key role in advancing the integration of the internal energy market, as it brings together the 27 senior representatives of the National Regulatory Authorities (NRAs) of Member States and non-voting representatives from EEA EFTA States, the European Commission and the EFTA Surveillance Authority.

The BoR approves the Agency’s work programme, provides opinions on its official acts and is consulted on important energy regulatory matters.

Read more on the BoR.

Today, ACER publishes its report on the French national regulatory authority’s (CRE’s) proposed gas transmission tariffs. In its report, ACER assesses the methodology proposed for calculating the tariffs applicable to the transmission networks and provides several recommendations to further justify the methodology.

What are ACER’s recommendations?

• Improve the justification provided for the proposed flow scenarios, in particular:
  • Support the proposed distance cost driver calculation with evidence. In the proposed methodology, this is based on the ‘shortest distance between entry and exit points’, instead of using the average distance between network points, which is the standard approach in the capacity weighted distance methodology.
  • Demonstrate that the application of non-economic combination of points is consistent with the possibility of sourcing gas to neighbouring markets from the French hub. The methodology proposes that certain combinations of network points cannot be considered in the calculation of the distance cost driver, as they are not competitive with alternative EU routes.
  • Provide a clearer explanation on the calculation steps and the outcome of the optimisation algorithm.

This recommendation aims at ensuring that CRE provides an appropriate justification for the assumptions and calculations proposed in the methodology.

• Increase transparency: ACER recommends that CRE assesses the impact of the proposed flow scenarios and unit cost equalisation on the distance cost driver and on tariffs respectively. CRE proposes that tariffs for the intra-system and cross-system use of the network have the same unit costs, but does not explain the degree to which tariffs are modified to achieve this objective.

• Yearly assessment on contracted capacity: ACER proposes a yearly assessment of the difference between the forecasted contracted capacity and the actual contracted capacity at the beginning of each tariff period. This is particularly relevant as the forecast is completed for a four-year period, instead of the more standard yearly period. The publication should inform stakeholders about the accuracy of the contracted capacity forecast.

Access all ACER reports on national tariff consultation documents.

On 30 November 2023, Transmission System Operators (TSOs) submitted to ACER their proposal for amending the definition of two European Capacity Calculation Regions (CCR).

What are the capacity calculation regions and why are they important?

CCRs define the geographic areas (i.e. by listing bidding zone borders) across the EU where TSOs coordinate the capacity calculation and other processes (i.e. subject to regional methodologies).

Currently, there are eight CCRs in Europe: Nordic, Hansa, Core, Italy North, Greece-Italy (GRIT), South-West Europe (SWE), Baltic and South-East Europe (SEE).

Having an efficient definition of CCRs benefits European consumers and producers:

• It allows TSOs to run regional processes related to capacity calculation, re-dispatch and countertrading more effectively.
• It optimises the provision of cross-zonal capacity, allows for more cross-zonal trade and ensures security of supply.

What is the proposed amendment about?

The TSOs are proposing to:

• merge the Core and Italy North CCRs to improve coordination and efficiency of capacity calculation and allocation processes in central Europe;
• include the Celtic interconnector (Ireland-France) to this newly merged region to facilitate Ireland’s further integration into the European electricity market.

Next steps

ACER will assess whether the TSOs’ proposals contribute to market integration, non-discrimination, effective competition, and the proper functioning of the EU electricity market.

To take an informed decision, ACER opened a public consultation and is inviting its stakeholders to submit their views by Wednesday, 10 January 2024.

ACER has six months to decide on the TSOs’ proposal. However, ACER is committed to reach a decision in three months, given the impact this might have on the electricity market.

Update of 21 March 2024: The Decision No 04/2024 and its Annexes have been uploaded here. 

• The Agency (ACER) takes this cybersecurity incident very seriously. The full investigation launched by the Agency, in close collaboration with the Computer Emergency Response Team for the EU institutions, bodies and agencies (CERT-EU), is still ongoing.
• Safeguarding the personal and sensitive information entrusted to us is of paramount importance.
• Based on the assessments to date, there is no evidence that ACER’s REMIT Information Systems have been impacted by this cybersecurity incident.
• We are working diligently to ensure a comprehensive investigation and mitigate the potential consequences of this incident.
• This is an ongoing investigation and further measures will be taken as appropriate.

Further information will be made available in due course. We have established a dedicated e-mail channel DataSecurity@acer.europa.eu to address any concerns.

Press contact: Press@acer.europa.eu

Read more:

• Update: 26 January 2024
• Update: 15 December 2023
• Update: 4 December 2023
• Update: 27 November 2023

On 24 November 2023, ACER received a proposal from all Nominated Electricity Market Operators (NEMOs) for amending the methodology for the price coupling algorithm and the continuous trading matching algorithm.

What is the methodology about?

The methodology sets the regulatory framework for the algorithms used for matching orders and allocating cross-zonal capacities in the European day-ahead and intraday electricity markets. The European day-ahead electricity market is based on an implicit auction, whereas the intraday market currently relies only on continuous trading. However, intraday auctions are expected to be introduced in 2024.

Thanks to a coordinated calculation of prices and flows, which is referred to as market coupling, available cross-zonal capacity is used more efficiently and price differences are reduced.

The current methodology was approved by ACER in July 2018 and amended in January 2020.

Why amend the methodology?

Amending the methodology, in particular the day-ahead coupling algorithm, is needed to enable a co-optimised allocation of cross-zonal capacity for the exchange of balancing capacity or sharing of reserves. Co-optimisation facilitates the integration of the balancing capacity markets and allows for a more efficient use of cross-zonal capacity.

Additionally, NEMOs proposed changes to the monitoring of scalable complex orders (which are a specific type of orders from market participants) and to the timings and delivery of results of intraday auctions.

What are the next steps?

ACER will run a public consultation and host a public workshop to collect views from stakeholders in the decision-making process.

• The public consultation will run from 18 January to 20 February 2024.

• The public workshop is planned for 1 February 2024.

Update as of 13 February: the public consultation's original deadline of 15 February has been extended to 20 February. 

ACER initially planned to decide on the matter by 24 May 2024, but will now decide by early autumn 2024 to incorporate stakeholders' views on the findings of the consultancy study.

Access the public notice initiating the procedure.

Update as of 24 September: with its Decision 11-2024, ACER adopted the amended methodology.

ACER has been the subject of a cyberattack. The Agency remains fully functional.

A full investigation was launched. We are working closely with the European Union’s Computer Emergency Response Team for the EU institutions, bodies and agencies (CERT-EU). Steps were taken to mitigate the consequences of the attack. This is an ongoing investigation and further measures will be taken as appropriate.

Further information will be made available in due course. We have established a dedicated e-mail channel DataSecurity@acer.europa.eu to address any concerns.

Press contact: Press@acer.europa.eu

Read more:

• Update: 26 January 2024
• Update: 15 December 2023
• Update: 4 December 2023
• Update: 27 November 2023

On 17 November 2023, the European Network of Transmission System Operators for Electricity (ENTSO-E), on behalf of Transmission System Operators (TSOs), submitted to ACER an amendment proposal to the methodology for coordinating operational security analysis (CSAM). Following the receipt of the TSOs’ proposal, ACER has initiated a procedure to decide on these amendments.

What is the methodology about?

CSAM supports the EU’s operational security by outlining the requirements to ensure:

• the electricity transmission system is operated in a coordinated manner;
• effective system operational planning;
• transparency and reliability of information on transmission system operation.

What does the amendment proposal entail?

The proposed amendments relate to the implementation of the observability area (i.e. where TSOs implement real-time monitoring and modelling of their systems to maintain operational security) as recommended in the Incident Classification Expert Panel’s final report on Continental Europe Synchronous Area Separation on 8 January 2021.

The amendment proposal aims at:

• Aligning the reassessment period for the observability area with the one for the external contingency list (i.e., the list of contingencies to be simulated to test the compliance with the operational security limits). This alignment is important to ensure that the operational security analysis is carried over accurately across all timeframes.
• Including busbar couplers in the contingency lists and in the TSOs’ Individual Grid Models (IGMs). This update ensures that the power flows are kept within the operational security limits after a contingency has occurred.

What are the next steps?

ACER will decide on the TSOs’ proposals to amend the methodology for coordinating operational security analysis by May 2024.

Access the public notice initiating the procedure.

The recent energy crisis showed how shifting and reducing electricity demand plays a crucial role when electricity supply is scarce or at risk. Furthermore, Europe’s ambition to be a carbon neutral continent by 2050 also means that more flexibility in the power system is needed. Electricity flexibility is the ability of energy resources and consumers to change or adjust their consumption or production in response to price signals, or to provide services to system operators. Increased flexibility in the EU power system presents key opportunities for consumers to be part of the clean energy transition. One important solution to achieve electricity flexibility is enhanced demand response.

What is electricity demand response?

Electricity demand response occurs when consumers (or aggregators on their behalf) adjust their consumption or production, in response to price signals.

What’s holding electricity consumers back? In all Member States, many barriers to demand response persist. These impact consumers, new entrants, and small players in electricity markets. Examples of these barriers are:

• the lack of a (or limited) legal framework to allow distributed energy resources (e.g. consumers, small wind generation, roof-top solar) access the electricity markets and provide services to electricity grids operators,
• the unavailability or lack of incentives to provide flexibility,
• restrictive requirements,
• limited competition in the retail market,
• public interventions to fix the retail electricity price.  

ACER reports annually on the barriers to demand response, as part of its Market Monitoring Report series. This year’s report, to be published in mid-December, identifies several key barriers to the participation of distributed energy resources (i.e., demand response, energy storage and distributed generation) in the wholesale electricity markets and system operation services in the EU-27 Member States plus Norway. Furthermore, it presents key findings and specific recommendations per country.

What are ACER’s next steps?

From 15 December 2023 to 26 January 2024, ACER will run a public consultation on the removal of barriers to electricity demand response. The objective is to gather stakeholders' inputs on prioritising strategies for overcoming these barriers.

On 19 January 2024, ACER will also organise a webinar to present its report on monitoring the barriers to electricity demand response and discuss its findings.

Based on the findings of the report and the inputs gathered from stakeholders, ACER will focus its 2024 market monitoring work on the most relevant barriers.