Frequency Containment Reserves (FCR)

In accordance with the objectives of the COMMISSION REGULATION (EU) 2017/2195 of 23 November 2017 establishing a guideline on electricity balancing (GLEB), the common market for procurement and exchange of FCR (FCR Cooperation) aims at the integration of balancing markets in order to foster, but not limit to, effective competition, non-discrimination, transparency, new entrants and increase liquidity while preventing undue distortions. These objectives must be met in consideration of secure grid operation and security of supply.

This regional project currently involves ten Transmission System Operators (TSOs) from seven countries. These are the TSOs from Austria (APG), Belgium (Elia), Switzerland (Swissgrid), Germany (50Hertz, Amprion, TenneT DE, TransnetBW), Western Denmark (Energinet), France (RTE) and the Netherlands (TenneT NL).

fcr map

Basic Principal

The Austrian, Belgian, Dutch, French, German and Swiss TSOs currently procure their FCR in a common market. Extension towards Western Denmark is foreseen and welcomed by all involved TSOs and National Regulatory Authorities (NRAs).

The FCR Cooperation works currently with weekly auctions with one weekly symmetric product. The auction takes place on Tuesday afternoon and applies for the next delivery week. The FCR Cooperation is organised with a TSO-TSO-model, where the FCR is procured through a common merit order list where all TSOs pool the offers they received. The interaction with Balancing Service Providers (BSPs) and the contracts between the TSOs and BSPs are handled on a national basis along with the responsibility of delivery.

Further development of the market design will facilitate the access for smaller market players, improve the investment signals and increase socio-economic benefits. The process of market design evolution is based on a close cooperation between all the TSOs, NRAs and stakeholders of the involved countries.

Historical evolution & Outlook

With the ongoing changes in the technology mix, e.g. increased share of renewables, demand side response and storage technologies, TSOs and NRAs decided to assess the current status of the FCR Cooperation and study the possible market design evolutions. The FCR Cooperation project partners launched a public consultation in January 2017, seeking market participants’ views on detailed design options and proposed choices to be implemented.

Extension towards France has been realised in mid-January 2017.

Resulting from the public consultation, the consultation report was published in May 2017, including TSO analysis and subsequent TSO conclusions. Foreseen market design evolution with detailed information is provided in the document

Article 33 (1) GLEB provides that TSOs exchanging […] balancing capacity shall develop a proposal for the establishment of common and harmonised rules and processes for the exchange and procurement of balancing capacity. Since the TSOs of the FCR Procurement are exchanging FCR, they developed a Draft Proposal (together with FCR Draft Proposal - Article 34_1). In accordance with GLEB Article 10, a public consultation on the Draft Proposals was undertaken beginning of 2018. On 26 April 2018, TSOs of the FCR Procurement have submitted their Proposal – Article 33_1 (together with Proposal – Article 34_1 ). TSOs have asessed views of stakeholders resulting from the consultation, and have prepared the consultation report including TSO analysis and subsequent conclusions.

Extension of the joint FCR procurement towards Western Denmark is currently foreseen and welcomed by all involved TSOs and NRAs.

With regard to the implementation of TSOs’ Proposal, TSOs would like to emphasize that the implementation plan is ambitious, especially for the implementation of daily procurement on weekdays by November 26th 2018. This change is required in order for the FCR cooperation to be compliant with the Guideline on Electricity Balancing and so to continue operate a joint procurement of FCR for all involved countries. BSPs are encouraged to consider this change ahead of the formal approval of NRAs.

Consultations

TSOs appreciate the received feedback from stakeholders during the public consultation on market design in February 2018. The feedback was analysed and improved proposals have been prepared and submitted to national regulators (links above and below).

Contacts

In case you are interested in the FCR Cooperation or have any questions, please contact FCR@entsoe.eu.

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