The German and Austrian electricity wholesale markets currently constitute a single bidding zone. The German energy regulator, Bundesnetzagentur, has today instructed the four German electricity transmission system operators (TSOs) to prepare to implement congestion management on the German/Austria border, with the aim of splitting the common German/Austrian bidding zone from July 2018. Frontier Economics has worked with a range of energy clients on this issue in recent years. An ongoing bidding zone review is currently underway at the EU level. Bundesnetzagentur has stated that, should this result in a different configuration of the German/Austrian zone, TSOs would be asked to halt their preparations.
Bundesnetzagentur argues that the split is necessary to ensure security of supply and reduce costly redispatching measures within Germany. The Austrian energy regulator, E-Control, and other market players in Austria argue that the split contradicts the European integrated electricity market. E-Control states that it will seek all possible legal remedies against the decision.
Frontier regularly advises regulators and energy companies on market design and congestion management in Germany and Austria.
For more information, please contact Miriam Rau at [email protected] or call +49 221 337 131 00.