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6. FOSTERING ELECTRICITY TRADING IN EUROPE

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A requirement to effectively trade electricity throughout Europe, especially given the variability of renewable energy source production, is sufficient capacity in grids and high levels of interconnectivity between the grids of the various Member States. These two aspects are vital to efforts to balance regional and national fluctuations in not only the generation of wind and solar power but also in its consumption.

Europe’s electricity market is divided in bidding zones. Each zone shall be the largest geographical area within which market participants are able to exchange energy without capacity allocation11. Most bidding zones correspond to the geographical borders of a country.

In addition, the EU also wants cross-zonal trade to expand and, therefore, cross-zonal capacity had to reach 70% by 202012.

Uncoordinated curtailments of interconnector capacities that limit the exchange of electricity between Member States have to be avoided. The effects of loop flows via other grids and internal congestion on cross-zonal trade also need to be reduced and, therefore, a predictable capacity value for market participants is also necessary13.

Under the applicable regulations, Member States could apply for a prolongation to fulfil the 70% requirement until end of 202514 if this ensured that the cross-zonal trade capacity will increase15 by following a linear trajectory16.

Transmission operators can apply for derogation from the trajectory for a maximum of two years on that grounds such derogation is necessary to maintain operational security17. Having said that, a derogation from the coordinated capacity requirements is possible for transmission system operators if implementing the changes would result in a violation of the operational security limits of network elements in their control area18.

Los Desafíos Jurídicos de la Transición Energética

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