ERAA 2025 Edition

Key takeaways

In the short- and mid-term (2028 and 2030) significant capacities are at risk of being decommissioned. In the longer term (2033 and 2035), the risks of decommissioning remain for thermal generation with only some potential gas investments in 2035. ERAA identifies some DSR expansion potential across Europe. However, these investments would require a favourable context beyond the scope of the ERAA, such as supply chain considerations, energy transmission networks and primary energy availability. 

The development of the power system must be closely monitored to confirm that investments will be realised. Investment strategies have a huge impact on resource adequacy. Relevant authorities can reflect on possible mitigation actions to secure European adequacy. The equivalent should be monitored for existing power plants to ensure that the decommissioning of the current fleet will not exceed the anticipated levels. Renewable generation capacity is expected to expand over the coming years based on national policy targets and TSO estimates (Figure 2). However, due to the intermittency of renewable resources, the capacity will not be sufficient to compensate for the expected decline in dispatchable thermal generation and the growing electrification by 2035.

Notable adequacy risks are observed across Europe. Available reliability standards (RSs) are exceeded widely. The results show adequacy risks generally increasing the further we look into the future. They tend to be lower in the Balkan region and part of Scandinavia. Existing non-market resources for mitigating adequacy risks, such as contracted strategic reserves, have already been accounted for in these assessments. The identified notable adequacy risks indicate the need for additional resources to remedy them.

At the European level, the adequacy risk from decommissioning thermal capacity due to economic unviability remains, despite ambitious policy targets to support renewable generation capacity, storage, and DSR expansion, and some additional investment opportunities identified in the EVA. In this context, the right incentives and/or targeted intervention, such as long-term market mechanisms, are essential to avoid adequacy risks by providing efficient price signals. These signals would trigger both the retention of existing capacity in the market and the timely deployment of new capacity in the right location.

Urgent action is needed: additional policy mechanisms must be promoted where necessary to enable the transition while maintaining system security until the aforementioned incentives and/or targeted interventions are established. To accelerate the implementation of CMs, in May 2025, the European Commission (EC) established a fast-track option under the Clean Industrial Deal State Aid Framework (CISAF). To ensure electricity security and meet climate objectives, Europe must accelerate the deployment of flexibility solutions and infrastructure, including a cross-border electricity transmission network to direct electricity from renewable sources where it is most needed, as well as storage and other sources of flexibility, while safeguarding security of supply at all times.

Many Member States complement the ERAA with an NRAA across Europe. NRAAs can provide a more detailed picture of a Member State’s adequacy concerns, taking into account specific characteristics of national systems that may not be reflected in ERAA outcomes given the enormous size and complexity of the EU power system and computational constraints. While the ERAA is one of the instruments used to inform EU Member States and National Regulatory Authorities (NRAs) about the level of security of supply and serves as the basis for decisions on different market design options by providing a comprehensive pan-European overview of capacity concerns, it is not the sole basis for identifying resource adequacy concerns. NRAAs are also essential, as they provide a complementary and more detailed picture of national specificities and local sensitivities. The ERAA and NRAAs should therefore be considered in conjunction.

Lastly, ENTSO‑E stresses that the primary purpose of ERAA goes far beyond serving as a mere tool for centralised decisions on CMs. ERAA supports policymakers in identifying adequacy concerns and building mid‑ and long‑term strategies, using pioneering methodologies and tools to analyse future adequacy with an unmatched combination of scope and detail. Therefore, ENTSO-E stresses the importance of refining credible reference scenarios in the ERAA, enhancing the complementarity of NRAAs, and respecting Member States’ national prerogatives to define policy options for calculating CM parameters. ENTSO-E has submitted a draft revised ERAA methodology to ACER for approval. The ERAA continues to serve as an effective tool for identifying system needs. Ongoing methodological innovation, refinement of its scope, pilot programmes, and stakeholder consultation will continuous to enhance the ERAA’s value.

Main findings