ACER webinar: implementation of the EU methodology for electricity adequacy metrics
What is it about?
ACER is organising a webinar to present the results of a consultancy study on how ACER’s (2020) methodology for adequacy metrics is being implemented. The methodology serves as a basis for determining the reliability standards of European countries.
What is resource adequacy and reliability standard?
A stable and ample energy supply is crucial for European consumers. Electricity security of supply depends on having adequate resources in the power system to meet the demand.
To maintain this level of security, Member States continuously monitor adequacy to ensure that the expected risk remains below the acceptable level. The power system is considered to have adequate resources when the risk level does not exceed the reliability standard. Member States define this acceptable or adequate level as a national reliability standard, based on the common methodology for adequacy metrics.
Why is this ACER methodology important for EU security of supply?
The EU methodology for adequacy metrics, developed by ENTSO-E and approved by ACER in 2020, is mandated by Europe’s 2019 Clean Energy Package legislation. It facilitates Member States in setting their electricity reliability standards based on how much consumers are willing to pay to ensure the security of electricity supply.
In line with the EU methodology, Member States determine their socio-economically efficient reliability standard based on:
- the value of lost load (VOLL), which represents the value that consumers place on an uninterrupted service; and
- the cost of new entry (CONE), which represents the cost of adding incremental capacity in the system to reduce the level of demand disconnections.
The reliability standards are calculated based on these two values as a balance between the costs of additional capacity in the system and the benefits of reduced power outages.
What is the study about?
Through its monitoring of EU electricity supply security, ACER observed substantial discrepancies in the calculated metrics. The reasons of such discrepancies are not straightforward. To understand the underlying factors and to determine if further methodological coordination is needed, ACER commissioned consultants, Johannes Kepler Universität Linz and RWTH Aachen University, in August 2023 to conduct a consultancy study on the topic.
What are the webinar’s objectives?
The aim of this webinar is to present and discuss with stakeholders the main findings of ACER’s consultancy study, focusing on:
- understanding the relevance of Europe’s adequacy metrics in assessing the security of Europe’s electricity supply;
- exploring key divergences in deriving adequacy metrics in different Member States;
- drawing input from interested stakeholders on possible ACER recommendations to facilitate the calculation of adequacy metrics in Europe.
What are the next steps?
The consultancy study will be published here on 29 May 2024 as a pre-reading material for webinar participants.
ACER will analyse the study recommendations and the input from the webinar to identify potential improvements in how Member States determine adequacy metrics. This analysis will be included in the ACER security of supply report, scheduled for publication in Q4 2024.
Share your views
Stakeholders are encouraged to submit their input on the topic at any time (before and after this ACER webinar), and at the latest by 21 June 2024, to the following email address: securityofsupply@acer.europa.eu.