S.2.2. The Internal Energy Market

D.2.2. The Internal Energy Market

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ACER Decision strengthens electricity market coupling rules

Monday, February 3, 2020

ACER published a Decision amending the rules defining how designated electricity market operators calculate the results of market coupling in the day-ahead and intraday periods and the products that market players can use on these markets.

Back on 21 October 2019, ACER launched a public consultation on the topic. In particular, ACER requested comments on the timing of the suspension of the allocation of interzone capacity in the context of continuous trading in intraday auctions (IDA), the possible simplification of the choice of products if the algorithms encounter performance problems, and the choice of monitoring and reporting indicators.

Following said consultation, ACER’s Decision now provides for stricter requirements and rules for “market operators to expand day-ahead coupling to additional Member States and to incorporate advanced features such as the flow-based capacity calculation and 15-minute products”.

More specifically, ACER adopts (Art.  7-9) provisions on the concept of product use and algorithm functionalities, monitoring of algorithm performance and notification of scalability of the products that market participants will be able to use in these auctions. Articles 3 to 6 of the Decision include the summary of algorithm requirements, provisions on the price coupling algorithm, the algorithm for matching continuous trading and the intraday auction algorithm, including the deadlines for implementing the specific requirements.

When it comes to intraday coupling, new intraday auctions will complement the continuous exchange model currently implemented under the cross-border intraday project (XBID).

As a result, by the end of 2022, three intraday auctions will be carried out daily. Expected benefits include a better allocation of the limited capacities of the interconnectors as well as offering market players more opportunities for intraday cross-border trade. The Decision also rests on the objective of more effective integration of renewable energy sources.