25.11.2022

ACER finds progress in short-term electricity market integration but forward market liquidity remains modest

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ACER finds progress in short-term electricity market integration but forward market liquidity remains modest

What is it about?

The EU Agency for the Cooperation of Energy Regulators (ACER) publishes today a progress report on European wholesale electricity market integration, as part of its 2021 Market Monitoring Report (MMR).

What is the progress report on European wholesale electricity market integration about?

The MMR presents the main results of monitoring the European electricity and gas markets and recommends further actions to foster their integration.

In 2022, unlike during previous years, ACER does not publish a single report gathering all monitored aspects of wholesale electricity markets but rather a series of brief overviews of electricity markets in 2021. The progress report on European wholesale electricity market integration is the third of these publications. It follows the ACER overview of the key developments in European wholesale electricity markets in 2021 (February 2022) and the ACER security of supply report (October 2022). In addition, ACER published its Final Assessment of the EU Wholesale Electricity Market Design in April 2022.

What are the main highlights?

The main wholesale electricity market integration trends identified in 2021:

  • Moderate increases in levels of cross-zonal capacity where Net Transfer Capacity calculations apply, consistent with ACER's 70% monitoring report;
  • Progress in the integration of EU markets in day-ahead, intraday (instrumental for the large scale integration of renewable energy resources) and in particular balancing markets;
  • A European platform for operating the imbalance netting process was achieved (24 June 2021). The platform coordinates ‘imbalance netting’, a process optimising the use of frequency restoration reserves among Transmission System Operators (TSOs);
  • Although forward market liquidity generally decreased in 2021, liquidity remained stable in day-ahead markets, and continued increasing in intraday markets. Overall, intraday liquidity has been increasing steadily since 2019; and
  • TSOs need to make a further 40% of cross-zonal capacity on electricity interconnectors available to meet the minimum 70% target.

Access the ACER progress report on European wholesale electricity market integration.