The EC released the public consultation on “generation adequacy, capacity mechanisms and the internal market in electricity” in mid-November together with the Communication on the Internal Energy Market. This consultation covers 4 distinct areas: market signals, generation adequacy assessment, capacity remuneration mechanisms, and EU criteria to assess capacity mechanisms.

ENTSO-E believes full implementation of the EU target model and the associated network infrastructure is a prerequisite for long-term efficient market outcomes as well as for providing the foundation for appropriate levels of security of supply. ENTSO-E also shares the concerns of the Commission in how implementing Capacity Mechanisms in numerous Member States may ultimately impact on the efficacy of the internal market.

Nevertheless, there needs to be recognition of Member States’ right to determine their own levels of security of supply. Moreover, to manage often conflicting energy policy objectives, in some regions there may well be a need for appropriate additional features in the market design in parallel with a well-functioning energy market.

However, these need to be well designed, complementary, reflective of the market signals and targeted to address real, and not perceived, issues at hand. In this last regard ENTSO-E and its member Transmission System Operators are best placed to provide the necessary engineering and technical analysis to determine threats to generation adequacy and its associated impacts on security of supply.

Download the full Position Paper, and link to EC documents through the links below.

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