Capacity Allocation and Congestion Management Guideline (CACM)
Commission Regulation (EU) 2015/1222 establishing a guideline on capacity allocation and congestion management entered into force on 15 August 2015. The Regulation governs the design of the electricity market for the short-term energy markets (day-ahead and intraday auctions). Market coupling in the day-ahead and intraday time frames is performed by nominated electricity market operators (NEMOs) and should normally be based on flow-based capacity calculation methods. From the perspective of transmission system operators (TSOs), the core elements of the CACM guideline relate to the determination of capacity calculation regions (CCRs), the development of flow-based capacity calculation methods and the review of existing bidding zones.
According to Article 35 of the CACM Regulation, all TSOs in each capacity calculation region must develop a proposal for a common methodology for coordinated redispatching and countertrading and submit it for approval to their national regulatory authorities (NRAs).
The proposal is subject to consultation in accordance with Article 12; the consultation is open until 5 October 2018.
Capacity calculation regions refer to the geographic areas in which TSOs perform coordinated capacity calculation. Within a capacity calculation region, the same capacity calculation method (flow-based or coordinated net transmission capacity) must be applied.
On 11 November 2015, all TSOs in the European Union submitted their proposal on the determination of capacity calculation regions to all NRAs for approval. Since the NRAs were unable to agree on the proposal or on a joint amendment, on 17 November 2016 ACER issued a decision on a modified proposal for the determination of capacity calculation regions.(*)
In line with the CACM guideline, the following 10 capacity calculation regions thus exist in Europe: Nordic, Hansa, Core, Italy North, Greece-Italy (GRIT), South-west Europe (SWE), Ireland and UK (IU), Channel, Baltic, South-east Europe (SEE).
ACER Decision on Capacity Calculation Regions
ACER Decision, Annex 1
On 12 July 2017, all EU TSOs submitted a proposal to all NRAs for approval concerning modification of the capacity calculation regions established. The proposal foresees assigning the bidding zone border between Belgium and the United Kingdom (BE-UK) to the Channel capacity calculation region.
Proposal for amendment to the determination of capacity calculation regions
The methodology determines which generation and load data is provided. The TSOs then use the data provided for the day-ahead capacity calculation in a common grid model.
On 13 June 2016, all EU TSOs submitted the proposal for a generation and load data provision methodology to all NRAs for approval. The proposal was approved by the NRAs on 28 October 2016.
Approved generation and load data provision methodology
The common grid model will be used by TSOs for future capacity calculations. Generation and load data will be fed into the model so that it can supply transmission capacity data to the market coupling operators (MCOs). On 13 June 2016, all EU TSOs submitted their proposal for a common grid model methodology to all NRAs for approval. On 11 May 2017, a modified proposal was approved.
Approved method for a common grid model
The congestion income distribution methodology governs how the congestion income generated at bidding zone borders is distributed to TSOs and any other owners of interconnectors. On 20 July 2016, all EU TSO submitted their proposal on the congestion income distribution methodology to all NRAs for approval. In December 2017, ACER issued a decision on the congestion income distribution methodology.
ACER decision on the distribution of congestion income
The day-ahead firmness deadline refers to the point in time after which the cross-zonal capacity calculated by the TSOs for the following day-ahead market coupling process becomes firm. On 13 December 2016, all EU TSOs submitted their proposal for the day-ahead firmness deadline to all NRAs for approval. The NRAs approved the TSOs’ proposal on 14 June 2017.
Approved day-ahead firmness deadline methodology
E-Control has named three Nominated Electricity Market Operators (NEMOs) for single day-ahead coupling (SDC) and single intraday coupling (SIC) in Austria. The arrangement developed by the TSOs describes the processes and solutions necessary when more than one NEMO is involved in a bidding zone, particularly before and after market coupling. The proposal on the arrangement must be developed by the TSO concerned in cooperation with the NEMOs concerned.
Multiple NEMO Arrangement for the bidding zone Gemany/Austria/Luxembourg
TSOs are responsible for proposing the intraday cross-zonal gate opening and intraday cross-zonal gate closure times. On 20 December 2016, all EU TSOs submitted a corresponding proposal to all NRAs for approval. A second, amended proposal was submitted for approval on 6 October 2017. ACER issued its decision on intraday gate opening and gate closure times on 24 April 2018.
ACER proposal for intraday gate opening and gate closure times
ACER decision, Annex 1
Fallback procedures are implemented in the event the single day-ahead coupling process is unable to produce results. Even in case of failure of the day-ahead coupling processes, it is necessary to ensure efficient, transparent and non-discriminatory capacity allocation. The fallback procedures are to be established at the level of the capacity calculation regions.
Approved proposal for fallback procedures for the Italy North region
Fallback procedures for the Core region: in progress
Cross-zonal capacity calculation methodology is established jointly by the TSOs at the level of the capacity calculation regions on the basis of harmonised input data. The model aims to implement a flow-based approach in each of the capacity calculation regions over the medium term and across Europe in the long term.
Core region capacity calculation methodology: in progress
Italy North region capacity calculation methodology: in progress
The methodology for coordinated redispatching and countertrading includes actions of cross-border relevance and is intended to enable TSOs to effectively relieve congestion irrespective of the control area in which the congestion originates.
The redispatching and countertrading cost sharing methodology includes cost-sharing solutions for actions of cross-border relevance.
(*) APG and E-Control had appealed the ACER decision, but the ACER Board of Appeal denied the appeal. At present, an action for annulment of the ACER decision is pending with the European Court of Justice (ECJ).