ACER adopts decisions on single EU electricity balancing market

London — The EU Agency for the Cooperation of Energy Regulators has published three decisions on the framework for implementation of EU-wide trading platforms for electricity balancing.

The decisions seek to integrate all national balancing markets into one single EU electricity balancing market, in a bid to boost security of electricity supply, reduce costs for consumers and limit carbon emissions.

"A common balancing market will allow EU member states to share the resources used by their transmission system operators to make [power] generation equal demand," ACER said in a statement Tuesday.

"This should help increase security of supply, limit carbon emissions and reduce costs to consumers," it said.

Two of the ACER decisions govern the electricity balancing from frequency restoration reserves with manual and automatic activation, while a third decision establishes a harmonized methodology on pricing of balancing energy.

Following the three ACER decisions, TSOs will establish two common European trading platforms that will enable all balancing energy bids to compete at EU level, promoting competition across EU member states.

"The bids for upward or downward balancing energy from balancing service providers across the EU will be available on these two platforms and all TSOs will be able to balance their national transmission systems by activating the cheapest bids available," ACER said.

This will enable the TSOs to balance their systems in a more cost-efficient and secure way, the agency said.

All balancing energy bids traded through the platform will receive a marginal price equal to the price of the bid that clears the market.

"This is a significant step forward as currently most TSOs use pay-as-bid pricing. Marginal pricing provides efficient price signals for existing balancing service providers and for potential new investors," ACER said.