ACER is gathering views and information regarding the proposal for the amendment of the methodology for pricing balancing energy and cross-border capacity used for the exchange of balancing energy or operating the imbalance netting process, which was submitted to ACER on 26 August 2021.

A public webinar will be held on 27  October 2021 on the same matter to present and discuss with stakeholders the proposal. 

The consultation will run until 10 November 2021, 23:59 hrs (CET).​

Access the Consultation.

Background

On 26 August 2021, all Transmission System Operators’ (TSOs) submitted to the European Union Agency for the Cooperation of Energy Regulators (ACER) their proposal for the amendment of the methodology for pricing balancing energy and cross-zonal capacity used for the exchange of balancing energy or operating the imbalance netting process in accordance with the EU Regulation establishing a guideline on electricity balancing .

Next steps

Having provided further amendments to the TSOs proposal, ACER is collecting comments from stakeholders in order to take an informed decision.

Top of the agenda of today’s Eurogroup meeting (4th October 2021) is the macro-economic situation in the euro area, including inflation and energy price developments. 

The Eurogroup is an informal body in which the Finance Ministers from the Eurozone discuss various euro-related matters concerning their countries' common responsibilities. Its main task is to ensure close coordination of economic policies among the euro area’s member states and promote conditions for stronger economic growth.

Mr Cristian Zinglersen, Director of the EU Agency for the Cooperation of Energy Regulators (ACER), was invited as a guest speaker today to update the Eurogroup on recent energy price developments. 

Among various topics, Mr Zinglersen addressed:

• the drivers of the energy price developments and impacts across Europe

• the outlook for the next six months, and

• policy considerations (short term, market design and broader energy transition pathways).

He explained that global gas (LNG) supply/demand dynamics play a key factor impacting energy prices, that the tight market conditions are expected to relax in Spring 2022, and that the policy implications are significant.

Register to ACER newsletter not to miss any updates on this topic.

In the meantime, check out the ACER Director’s slides.

The EU Agency for the Cooperation of Energy Regulators (ACER) has received on 26 August 2021 all transmission system operators (TSOs)’ proposal to amend the common methodology for harmonising the pricing balancing energy and cross-border capacity across the European electricity markets. The methodology is used for operating the exchange of balancing energy in the EU platforms or the imbalance netting process. The amendment proposes a reduction of the technical price limits of the integrated balancing energy markets. 

What are the next steps?

ACER will reach a decision on the proposal by 26 February 2022.

To take an informed decision, ACER will collect inputs by discussing with TSOs and National Regulatory Authorities (NRAs) in the course of the decision making process.

To collect inputs from all interested stakeholders, ACER will:

• open a public consultation from early October until early November 2021

• hold a public workshop (mid-October 2021)

What is the benefit of having a common pricing methodology for Europe?

The common pricing methodology for balancing energy and cross-border capacity provides the rules for the efficient and harmonised pricing of the balancing energy at European level, resulting from:

• bids activation

• cross-border capacity used for the exchange of balancing energy.

How does ACER contribute?

ACER ensures the decision on all-TSOs’ proposal is in line with the objectives of the Electricity Balancing Regulation and fulfils the legal obligations set out by its Article 30(2), as well as with those of the Regulation on the internal market for electricity.

The EU Agency for the Cooperation of Energy Regulators (ACER) publishes today a methodological study to measure barriers to efficient price formation and easy market entry and participation for new and small players in the EU electricity wholesale markets. The study proposes a set of indicators and a methodology that will enable ACER to fulfil more effectively its new monitoring responsibilities set by the Clean Energy Package.

In particular, the study defines more than 70 indicators to be progressively included in future editions of the yearly ACER Market Monitoring Report (MMR) - Electricity Wholesale Market Volume. This will provide a comprehensive picture of the relative performance of the EU Member States in terms of efficient price formation and easy market entry and participation for new entrants and small actors.

The report describes:

• ​13 barriers to efficient price formation and nine barriers to easy market entry and participation for new entrants and small actors.

• More than 70 qualitative and quantitative indicators to measure these barriers.

• The methodology to combine these indicators and create two composite indicators:

  • ACER index on efficient price formation

  • ACER index on easy market entry for new players and small actors

• A pilot study conducted to test the data collection process, as well as the robustness of the composite indicators´ calculation tool.

The study has been conducted with the support of the consultancy DNV. Relevant inputs have also been collected from the National Regulatory Authorities (NRAs) and a wide range of stakeholders through a public consultation and a set of interviews.

ACER aims to enhance this methodology over the years by adapting some barriers and indicators proposed in the study and including new ones, as the market develops.

Access the study and read more about its main findings.

Background information

Following the adoption of the Clean Energy Package, ACER has expanded the scope of its monitoring activities. Among the others, ACER is required to monitor state interventions preventing prices from reflecting actual scarcity and regulatory barriers for new market entrants and smaller actors.

Furthermore, ACER is legally required to identify and report any barriers to the completion of the internal markets for electricity and natural gas. In order to fulfil this requirement, ACER produces an annual Market Monitoring Report. Its objective is to assess the functioning of the Internal Energy Market and to show how energy markets can work more efficiently.

The Market Monitoring Report comprises of three different volumes on the Electricity Wholesale Market, the Gas Wholesale Market, and the Retail Markets & Consumer Protection.​

Save the Date: The 2020 edition of the Electricity Wholesale Market and Retail Markets & Consumer Protection Volumes are upcoming in November 2021. Sign up to our Infoflash newsletter not to miss them.

The EU Agency for the Cooperation of Energy Regulators (ACER) has reached a decision on the proposals for market-based cross-border capacity allocation processes in the Baltic and Core regions.

These processes aim to maximise the welfare generated by the provision of cross-border capacities to the day ahead energy and balancing capacity markets.

In February 2021, the national regulatory authorities for energy from both regions have asked ACER to decide on the respective methodologies.

The Core region includes 13 countries: Austria, Belgium, Czech Republic, Croatia, France, Germany, Hungary, Luxemburg, the Netherlands, Poland, Romania, Slovakia, Slovenia.

The Baltic region comprises of 6 countries: Estonia, Finland, Latvia, Lithuania, Poland and Sweden.

Two further proposals (submitted on a voluntary basis), respectively on the market-based cross-border capacity allocation process in the Hansa capacity calculation region (CCR) and on the regional cross-border capacity allocation process based on economic efficiency in the Core CCR, were withdrawn from the respective transmission system operators (TSOs).

Therefore, ACER will not take any decision on these two methodologies.

How did ACER contribute?

ACER revised both methodologies to improve the efficiency, transparency and non-discrimination of these capacity allocation processes for the exchange of balancing capacity or sharing of reserves.

Both ACER Decisions contribute to the integration of the balancing capacity markets by establishing the rules for allocating the cross-border capacity needed to facilitate the balancing capacity procurement at regional level.

Read more about ACER Decision 10-2021 on the Baltic CCR methodology and its Annexes.

Access ACER Decision 11-2021 on the Core CCR methodology and its Annexes.