ENTSO-E’s work on Market Design Options for Congestion Management sets out a forward-looking view on how market design can support the reduction and efficient management of congestions. It highlights the need for a closer alignment between market design and the physics of the power system, so to ensure secure operation in an increasingly complex energy system while reducing system costs borne by consumers.
Increasing renewables deployment, electrification of demand and grid buildout are essential to ensure affordable, secure and carbon-neutral energy. However, as Europe progresses in this transition, grid congestion is increasing in frequency, variability, scale and complexity. Addressing these challenges requires not only timely infrastructure delivery but also a more efficient use of existing grids, facilitated by market design and congestion management solutions.
The paper considers different options related to spatial granularity in energy markets, locational siting incentives, preventive measures outside wholesale markets and congestion management tools. The analysis assesses pros and cons of the different options, also showing how they could be combined into coherent toolbox of complementary market design measures.
ENTSO-E and its TSOs looks forward to continuing working with the European Commission, ACER, Member States, regulators, and all relevant stakeholders to promote an efficient use of existing grids, so that the energy transition safeguards system security while limiting system costs.
Read the short Position Paper here and the extended Paper here.