The sixteen transmission system operators of the Central Western Europe and Central Eastern Europe capacity calculation regions (CCRs) signed a memorandum of understanding (MoU) on 3 March to develop a common day-ahead flow-based capacity calculation methodology and merge the two regions into one.​

​This is in line with the European target model for electricity and the EU regulation on the implementation of the capacity calculation and congestion management the guideline – the “CACM regulation”.

“The common day-ahead flow-based methodology will facilitate electricity exchanges across 13 member states, enhancing security of supply and choice for more than 270 million customers”, commented ENTSO-E Chair of the Board Bente Hagem.

The day ahead flow-based methodology is a methodology adapted for meshed networks with high penetration of variable generation. It will be submitted to national regulators’ approval in the first quarter of 2017 and base itself on the flow-based methodology existing in CWE and the one under development in CEE.

A common capacity calculation methodology is the condition for a merger of the two regions. The intention to merge was clearly stated in the proposal of “all TSOs” on CCRs submitted to all national regulators mid-November 2015. The proposal was the first milestone in the implementation of the CACM regulation – the founding regulation for the organisation of a single electricity market. The proposal is now under examination by the national regulators who should come up with a decision by mid-May.

Frequently asked questions

What is a capacity calculation region?

A capacity calculation region is a geographical area in which the relevant TSOs apply a coordinated capacity calculation.

What are the countries covered by the CWE and CEE CCRs?

The CWE CCR covers France, Germany and the Benelux countries. The CEE CCR covers Germany, Luxembourg, Austria, Poland, the Czech Republic, Slovakia, Hungary, Romania, Slovenia and Croatia. So 13 member states are concerned in total.

What is a day ahead flow-based methodology?

Day-ahead means it is the methodology used to calculate available cross-border transmission capacity available for trading electricity in the day-ahead timeframe, that is the day before the electricity is actually dispatched in the system.

Flow-based is a methodology to calculate available cross-border capacity linking to the actual situation of the national grids and taking more into account the fluctuation of energy flows. It is more complex as it takes a wider range of elements into account to calculate capacity. It was developed by the TSOs to adapt to the new generation mix and the increasing cross-border exchanges. But the flow-based methodology also offers to market participants and public authorities a more accurate view of the reality of the grid on which to base their decisions.

Does the CACM regulation require flow-based to be used in all the EU?

No. CACM allows for a choice between flow-based and available transfer capacity (ATC) also called net transfer capacity methodology which is a more static capacity calculation but perfectly adapted to more radial networks with less lines impacting on one another. The regulation allows for a choice between the two methodologies depending on the topology of the grid considered.

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