Bidding Zone Review
Reporting on existing bidding zones and their review
Pursuant to Article 34 of the CACM Regulation, the Agency needs to assess the efficiency of current bidding zone configuration every three years by requesting ENTSO-E to draft a technical report on the current bidding zone configuration and drafting a market report evaluating the impact of the current bidding zone configuration on market efficiency. If the technical or the market report reveals inefficiencies in the current bidding zone configuration, the Agency may request the TSOs to launch a review of an existing bidding zone configuration in accordance with Article 32 of the CACM Regulation.
Action 1: In December 2016, the Agency requested, pursuant to Article 32(1)(a) and Article 34(7) of the CACM Regulation, all TSOs of Austria, Belgium, the Czech Republic, Denmark, France, Germany, Hungary, Italy, Luxembourg, the Netherlands, Poland, Slovakia and Slovenia to review the bidding zone configuration in that area in accordance with the process in Article 32(4) of the CACM Regulation. The request was based on Agency's assessment, which revealed inefficiencies in the current bidding zone configuration. This assessment was based on the technical report of ENTSO-E and market report of the Agency performed in the context of early implementation of the CACM Regulation. The technical report issued in 2014 can be found here. The market report issued in 2014 can be found here.
Action 2: In October 2017, all TSOs included in the bidding zone review developed the methodology and assumptions as well as alternative bidding zone configurations that will be used in the review process and submit them the concerned regulatory authorities, which may request amendments to the proposal within three months.
Action 3: In October 2017, the Agency requested, pursuant to Article 3 of the CACM Regulation, from ENTSO-E to draft a technical report on bidding zones configuration covering the area of the whole EU, including the significantly impacted third countries, and covering at least the last three calendar years, i.e. from 2015 to 2017. In January 2018, the Agency reiterated this request in order for ENTSO-E to include a calendar year 2017 into the report.
Action 4: In April 2018, ENTSO-E, on behalf of all TSOs involved in the first bidding zone review process, submitted to all relevant regulatory authorities and to the Agency the report on the first review of the bidding zones.
Action 5: In October 2018, ENTSO-E submitted to the Agency a new technical report on bidding zones pursuant to Article 34 of the CACM Regulation.
Action 6: In November 2019, the Agency commissioned a study that proposes methodologies and indicators to evaluate the potential impact of a bidding zone reconfiguration on market liquidity and transaction costs. The study was commissioned with a view to support the regulatory discussions leading to the approval of the methodology and assumptions to be used in the bidding zone review study prescribed by the Clean Energy Package. The study is available here.
Action 7: On 1 April, the Agency launched a public consultation on the bidding zone review study mandated by the recast Electricity Regulation of the Clean Energy Package. Taking stock of lessons learnt from previous bidding zone reviews, the consultation aimed to gather views from stakeholders to identify improvements to the proposal for a bidding zone review methodology, assumptions and configurations submitted by all TSOs to all NRAs on 18 February 2020. Find out about the public consultation and the responses received.
Action 8: In November 2020, the Agency adopted a decision on the methodology and assumptions that are to be used in the bidding zone review process and for the alternative bidding zone configurations to be considered. You can find the decision here as well as its Annexes I, Ia, Ib, II and III.
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