Capacity mechanisms
A capacity mechanism is a temporary measure introduced by Member States to remunerate capacity resources (e.g. generators, demand-response or storage units) for security of supply services.
Capacity mechanisms can be introduced or maintained only if a resource adequacy concern has been identified, and should be open to cross-border participation.
The ACER-CEER Market Monitoring Reports includes topics related to security of supply, estimating the cost incurred for the capacity mechanisms in operation or under consideration.
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Security of supply
A secure supply of electricity is crucial for the European Union. As electricity powers homes and businesses across Europe, consumers increasingly rely on its continuous availability.
Security of supply is one of the five mutually reinforcing dimensions of the Energy Union strategy. In responding to current challenges, the Energy Union facilitates energy market integration, which is essential for a stable supply.
At the core of the Energy UnionACER is committed to enable a high-level of security of supply in a cost efficient and non-discriminatory manner.
Well-functioning wholesale markets contribute to this goal. However, regulatory distortions or other issues may prevent electricity prices from reflecting their true value when security of supply is at risk, possibly leading to underinvestment and security of supply issues.
In this case, additional measures may be needed to increase security of supply. Such measures can include removing regulatory distortions and introducing temporary capacity mechanisms.
Risk-preparedness also ensures that risks related to security of supply are identified in a timely and consistent manner, as well as they are properly monitored and mitigated.
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