The EU Agency for the Cooperation of Energy Regulators (ACER) publishes today a decision approving an amendment to the congestion income distribution methodology for European electricity markets.

The amendment proposal was submitted by all Transmission System Operators (TSOs)’ to ACER in July 2021.

The approved methodology ensures a transparent and non-discriminatory sharing of congestion income among TSOs. 

What are the benefits of this amendment?

The amendments to the methodology are mainly connected with the implementation of the Core flow-based capacity calculation methodology planned for early 2022 and the progresses in the single intraday coupling.

As such, the amendment:

• introduces a more advanced calculation approach for those regions applying flow-based capacity calculation,

• extends the congestion income sharing to future intraday auctions and

• aligns the congestion income distribution methodology with the long term methodology as defined by the Forward Capacity Allocation (FCA) Regulation to ensure consistency across timeframes.

What’s the scope of the methodology?

The congestion income distribution methodology:

• facilitates the efficient long-term operation and development of the electricity transmission system,

• simplifies the efficient operation of the EU internal electricity market,

• allows for reasonable financial planning and

• reflects the general principles for congestion management provided by the Regulation on the internal market for electricity. 

Access the decision.

Europe’s Clean Energy Package of legislation set a binding minimum 70% target for electricity interconnector capacity for cross-zonal trading (the “minimum 70% target”). 

Why is this 70% target important?

The lack of sufficient cross-zonal capacity between Member States is one of the main barriers to the integration of electricity markets, and market integration is key to deliver on Europe's energy goals. Larger amounts of cross-zonal capacity made available for trade increase cross-border competition and facilitate more renewables on the grid.

Why is ACER publishing a dedicated 70% target report on the Nordics?

In 2020 and 2021, ACER published two reports monitoring the minimum 70% target in the EU. However, the analysis of the Nordic Alternate Current (AC) borders was not included, due to insufficient data provided by the Nordic TSOs to ACER at that time. Following a decision issued by ACER, the data was subsequently received.

What are ACER’s finding on the minimum 70% target in 2020 in the Nordic region?

The performance of the Nordic countries and the quality of the data they provided for monitoring is diverse.

While Denmark and Finland are meeting the 70% minimum target almost at all time, there is room for improvement for Sweden.

Moreover, ACER underlines that the monitoring would benefit from more accurate data, and invites the Transmission System Operators to accelerate their efforts to improve the quality of data they provide.

ACER calls for more harmonisation in monitoring, reporting and assessing compliance with the minimum 70% target.

In 2020 and 2021, ACER, a number of regulatory authorities and the European Network of Transmission System Operators for Electricity (ENTSO-E) published various reports on the level of fulfilment of the 70% minimum target.

ACER calls for more coordination and harmonisation in these reports. A common and consistent message delivered by all concerned parties is key to facilitate stakeholders’ understanding of the progress towards meeting the minimum 70% target and to ensure that the minimum 70% target is implemented with equally high standards across the EU.

Find out more and access the reports.

The EU Agency for the Cooperation of Energy Regulators (ACER) publishes today its Opinion on the European Network of Transmission System Operators for Gas (ENTSOG) Winter Supply Outlook 2021/2022.

What are the main highlights of ENTSOG Winter Supply Outlook?

ACER highlights the following findings from ENTSOG’s Outlook:

• The EU storage level on 1st October 2021 (75% of overall storage capacity) is one of the lowest in recent years, with varying situations among countries.

This is primarily due to a record high use of storage flexibility during the previous winter and a low injection during the summer with record-high gas wholesale prices.

• The European gas infrastructure offers sufficient flexibility to supply volumes to meet demand in Europe, assuming that gas supply is available in similar volumes as in recent years.

However, in case of a cold winter, the gas market would need to increase imports from pipelines and/or LNG by 5% to 10% more than the maximum volumes observed in recent years.

• Early and significant gas withdrawals from storages would result in low storage levels at the end of the winter season, with a negative impact on the gas system flexibility.

• South-Eastern Europe has significantly reduced its exposure to demand curtailment following the commissioning of new infrastructures, such as the Trans Adriatic Pipeline, Turk stream and other investments.

Despite this improvement, the Outlook’s supply route disruption simulations show that some demand curtailment under extreme temperatures are possible in selected regions.

What is ACER’s assessment?

ACER welcomes the timely publication of the ENTSOG Winter Outlook and finds it contributes to the objectives of the EU Regulations.

In particular, the Agency:

• notes with concern that, in case of a cold winter, the gas market would need to increase its gas imports from pipelines and/or LNG compared to maximum volumes observed in recent years, creating a risk of exposure to high gas wholesale prices.

• welcomes ENTSOG’s willingness to monitor the storage levels’ evolution and import volumes throughout the upcoming winter and to report on a regular basis and when anomalies appear.

• highlights the critical importance of counting with adequate storage levels towards the end of the winter season in anticipation of possible high demand or system stress situations.
  • Early and significant withdrawal would result in low storage levels at the end of the winter, with a negative impact on the flexibility of the EU gas system.
  • ACER expects storage users to prudently withdraw gas from storage to contribute to safeguarding the continuity of gas deliveries throughout the winter, in compliance with the contractual commitments and storage obligations, where applicable.

• identifies the existence of specific risk factors for the upcoming winter season (not always factored or mentioned in the Outlook), such as:
  • uncertainty on the availability of additional volumes from major sources of gas imports going beyond the contracted volumes,
  • very high gas wholesale prices.

ACER calls on ENTSOG and all actors with responsibilities related to gas supply continuity and price monitoring to remain vigilant for the upcoming winter in regards of those risk factors.

What does ACER recommend?

ENTSOG should consider improving future Outlook’s assumptions and methodology to better identify potential supply risks, including exposure to very high gas wholesale prices.

In particular, ACER encourages ENTSOG to consider using a complementary scenario based on expected gas supply and booked capacities in addition to the current scenarios based on historical values of gas supply. ACER also suggests to  include embedding expected gas prices and gas price demand elasticity into ENTSOG’s modelling.

The EU Agency for the Cooperation of Energy Regulators (ACER) has published the outcome of the 2021 roundtable meetings on REMIT data reporting, the 26th edition of the Questions and Answers (Q&As) on REMIT, and an "Open Letter on the extension of the possibility to disclose inside information through corporate websites as a backup solution in case of platform unavailability".

Outcome of the 2021 roundtable meetings on REMIT data reporting

ACER has published the minutes of the latest roundtable meetings – held virtually on 16 and 18 November 2021 – with representatives from organised market places, registered reporting mechanisms, inside information platforms and associations of energy market participants. The minutes reflect the lively discussions on the accomplishments related to REMIT activities, the relevance of present and future challenges, and the next steps to be taken.

The REMIT roundtable meetings –usually held once a year – allow ACER and stakeholders to check in on the state of play of REMIT-related topics and report, discuss and consult on any outstanding issues. The recent meetings were, in particular, an opportunity for ACER to share the latest updates on REMIT data collection, as well as to discuss the ongoing consultation on the updated versions of the transaction reporting guidance and the electronic schemas.

New edition of Q&As on REMIT

ACER also publishes today the 26th edition of the Q&As on REMIT.  It contains the most up-to-date information on REMIT policy issues and it is the result of cooperation with national regulatory authorities (NRAs). It contains new information on the registration of market participants under REMIT, as well as an update on the adoption of backup solutions when dealing with the disclosure of inside information. The Q&As reflect the discussions held with stakeholders during specific events – such as webinars and roundtable meetings – as well as interactions via the REMIT Query form.

New open letter on disclosing inside information

The newly published open letter on the extension of the disclosure of inside information through corporate websites as a backup solution in case of platform unavailability announces ACER’s decision to extend – until 31 December 2022 – the possibility for market participants to publish inside information on their own corporate website as a backup solution.

The decision was triggered by the monitoring of the relevant requirements, consultations with the NRAs, and discussions with market participants during the roundtable meetings 2021. The ACER Guidance on the application of REMIT stipulates that in case an inside information platform (IIP) is temporarily unavailable, a market participant shall refer to a backup solution provided by the IIP. As indicated in the Open Letter, such an exceptional condition may apply only insofar as the website used as a backup solution fulfils the relevant minimum data quality requirements in accordance with the ACER Guidance on REMIT.