Balancing capacity exchanges
Development of methodologies for exchanges of balacing capacity
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 two 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.
Implementation: The FCR Cooperation is operational and expanding. The common rules and processes for the Nordic aFRR market will be implemented once the capacity calculation methodology for the Nordic capacity calculation region is applied according to the CACM Regulation.
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:
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.