ENTSO-E Market Report 2023


Our trading specialists carry out a periodic analysis of the European electricity market for the utilities we accompany as technology partner. You can now have access to the most recent study.

This year, ENTSO-E released its annual report on the European electricity market. This analysis will provide a description of the presentation and delve into the most interesting issues presented in the report.

Market report

The annual market report stands as the crown jewel of ENTSO-E’s market monitoring activities. This comprehensive document addresses the integration of diverse European electricity markets in accordance with relevant regulations (FCA, CACM, EB). It extensively describes the integration landscape, considering both long and short-term perspectives, as well as the current and future developments influencing European electricity markets.

Figure 1. Overview of the different time frames in the wholesale and balance sheet markets. Source: ENTSO-E

This document includes a report on the calculation and allocation of capacity, covering the period from June 2022 to May 2023. Additionally, it comprises other sections, such as:

  • Regional systems.
  • Balance sheet performance indicators.
  • Annual costs associated with setting up, correcting, and operating various platforms.

In relation to Forward Capacity Allocation (FCA), ENTSO-E has updated its evaluation methodologies to facilitate Long-Term Flow-Based Allocation (LTFBA), as outlined in articles 49, 51, 57, and 61 of the FCA Regulation. These updates encompass:

  • Harmonised Allocation Rules (HAR).
  • SAP requirements (Single Allocation Platform).
  • CID methodology (Congestion Income Distribution).
  • Methodology to ensure the strength and remuneration of Long-Term Transmission Rights (LTTRs).

All of these methodologies have been presented and approved by ACER, with the exception of the harmonization of allocation regulations. Throughout this period, ENTSO-E and ACER have jointly organized several workshops involving market participants.

Figure 2. LTFBA process. Source: ENTSO-E.

In relation to Capacity Allocation and Congestion Management (CACM), certain Transmission System Operators (TSOs) have proposed a modification to the methodology for determining the Capacity Calculation Region (CCR), as outlined in Article 15 of the CACM Regulation. The aim is to allocate the Norwegian interconnections (bidding zone borders) to the corresponding CCRs, namely Nordic and Hansa. This proposal has received approval from both ENTSO-E and ACER.

Currently, some TSOs are working on modifying the Congestion Income Distribution (CID), as specified in Article 73. This adjustment seeks to incorporate solutions for routing congestion income transfers between different CCRs in cases of non-intuitive flows.

All TSOs have made amendments to the Day-Ahead Scheduled Exchanges Methodology (Article 43) to facilitate changes in the inter-NEMO flow calculations (post-coupling process). The objective is to minimize flows and, consequently, financial exposure between NEMOs. This updated methodology has already received approval from ACER.

A significant milestone occurred at the beginning of the observed period with the Go-live of Flow-Based in the Core region. This will be followed by the next Go-live of Flow-Based in the Nordic region, scheduled for Q1 2024.


During this period, the CACM 2021 Annual Report was presented, providing a detailed breakdown of all costs associated with Single Day-ahead Coupling (SDAC) and Single Intraday Coupling (SIDC).

Consultations were conducted with all NEMOs between May and July 2022 to establish Harmonised Minimum and Maximum Clearing Prices (HMMCP, as per articles 41.2 and 54.2). The proposals put forth during this process were subsequently approved by ACER in January 2023.

Despite conducting a public consultation on the SDAC product methodology (as outlined in Article 40), no proposals were received, and consequently, the product list will remain unchanged.

FCA and long-term markets

SAP, the FCA platform, has been in operation since its launch in 2018 and currently encompasses 67 directional zone boundaries, engaging with over 400 active market participants.

Figure 3. Countries whose TSOs are obliged to belong to the SAP Council and are part of the SAP CA (SAP Cooperation Agreement). Source: ENTSO-E.

The Joint Allocation Office (JAO) is the exclusive operator of SAP for FCA, overseeing annual, quarterly, and monthly products in auctions of cross-border transmission capacity rights. To date, JAO has successfully conducted more than 4,200 auctions.

The operation of FCA’s SAP has demonstrated remarkable stability over the years, and from a regulatory standpoint, there are no significant changes, as the regulations are nearly fully implemented. The ratio of “auction participants” to “capacity-winning participants” (13/31) ensures [Click on the banner below to read more]


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