De-rating of Dutch plant seeking Belgian capacity fees 'likely to be minimal'

Power stations in the Netherlands should be able to bid material quantities of capacity into Belgium's proposed capacity market mechanism even if not connected by a dedicated cable, Tennet policy advisor Anton Tijdink told S&P Global Platts July 20.

Under EU clean energy package regulations, capacity markets must be open to cross-border participation, Tijdink said.

EU energy regulatory agency ACER is consulting on the technical rules for capacity providers to take part in capacity mechanisms outside their own country.

ACER is inviting comments on EU transmission body Entso-e's proposals on the rules.

These include how to calculate the maximum entry capacity for foreign providers and how to share revenues from allocating entry capacity.

Interconnection availability from the Netherlands to Belgium is likely to be good, suggesting any de-rating of Dutch capacity up to available cross-border capacity could be minimal, Tijdink said.

NL-BE cross-border capacity is currently 1.7 GW, and is forecast to rise to 3.4 GW after 2025, according to Tennet's adequacy assessment.

"It is not necessary for capacity in the Netherlands to be directly connected to Belgium in order to receive availability fees," Tijdink said, a reference to RWE's plan to build a cable linking its Clauscentrale plant in the Maasbracht directly to Elia's network in Belgium.

This was rejected for the second time in July by Minister of Economic Affairs and Climate Policy Eric Wiebes.

On July 14 an RWE spokesman told Platts the generator would "look into the details [of the rejection of its appeal] and then consider what we will do."

SIMULTANEOUS SCARCITY

When considering access to neighboring capacity markets, transmission system operators look at simultaneous scarcity in combination with cross-border availability, Tijdink said.

In Elia's adequacy and flexibility study 2020-2030, the Belgian TSO forecasts zero correlation between Belgian and Dutch scarcity events through the period.

As such "this study indicates significant participation of Dutch capacity in a Belgian CRM is possible. The actual entry capacity available for participation will be determined by Elia based on a recommendation of the regional coordination center. For Belgium this is Coreso," said Tijdink.

Simultaneous scarcity between Belgium and GB was also near zero, while for France and Germany the figures showed a more nuanced picture (see table).

"From 2025 to 2030, it can be observed that the simultaneous hours with France are decreasing, while those with Germany are increasing," the report said.

Elia has estimated Belgium needs 3.9 GW of replacement capacity to cope with the phase-out of the country's nuclear fleet by 2025.

A first four-year-ahead capacity auction in Belgium is due to take place next year. Belgium has yet to finalize its capacity mechanism legislation as the market's design still needs approval from the European Commission.

SIMULTANEOUS SCARCITY EVENTS: CORRELATION BETWEEN BELGIUM AND NEIGHBORING COUNTRIES

Source: Elia

NETHERLANDS: AVAILABLE IMPORT/EXPORT CAPACITY

Reductions: due to failures, revisions, loop flows

Source: Tennet