Annual Market

Update 2020
Electricity market insights

7 April 2021
 Introduction
Introduction
Annual Market Update 2020, an electricity market review focused on the
Netherlands and Germany, including wider European trends
Main
findings

This Annual Market Update (AMU) is focussed on relevant developments on the Central Western European
electricity markets, and the Dutch and German electricity markets in particular. This is the third edition of the
Wholesale
market prices
TenneT Annual Market Update. Previous editions of the AMU and its predecessor the TenneT Market Review can
be found here.

Fuel prices &

generators
The developments in the Annual Market Update are structured alongside several main topics:
• The chapter Wholesale market prices discusses wholesale day-ahead and identifies price trends.
• As our electricity system is still highly dependent on fossil-fuelled power, the chapter Fuel prices describes
Capacity &
generation
developments in hard coal, natural gas and emission allowance prices, as well as the margins for generators.
• The chapter Capacity & generation focuses on the supply side of the electricity system and discusses
developments in installed capacity and generation.
RES support • Support for renewables in the Dutch and German system are discussed in the chapter RES support schemes,
schemes
by looking at budget distribution, awarded capacity and generation in the subsidy schemes.
• In the chapter Wholesale market integration the storyline zooms out and includes the interactions of the Dutch
Wholesale
market
and German electricity system with neighbouring systems. Additionally, the ongoing efforts of coupling EU
integration
electricity markets are discussed in this chapter.
• The last two chapters focus on mechanisms in place to ensure the stability and functioning of the electricity
system for both the Netherlands and Germany: Balancing measures, to ensure supply and demand is equal at
Balancing all times; and redispatch measures, to resolve congestion in the grid.

Congestion
management

2 7 April 2021
 Main Findings (1/3)
Introduction
Lower wholesale prices across Europe in 2020, significantly impacted by the
covid-19 pandemic
Main Wholesale electricity prices across Europe decreased in 2020. The annual average day-ahead electricity price
findings
decreased within the CWE region with 19% to 32 €/MWh. Between March and June all European countries
installed restrictive measures in a response to the covid-19 pandemic spread across the globe. In these months
day-ahead electricity prices dropped to monthly average prices in the range of 17-25 €/MWh. After this first series
Wholesale
market prices of restrictive measures, some degree of relieve in measures were implemented that resulted in increased
economic activity and corresponding demand for energy. Since June the day-ahead electricity prices kept rising
and surpassing the yearly average level of around 39 €/MWh since September.
Fuel prices &
generators

Additionally wholesale prices within the CWE region remained at a similar converge of 43% compared to 42% in
2019. For the Netherlands the amount of hours with full price convergence slightly decreased with all neighbours
Capacity & and reached 49% full convergence with Germany, which was 1%pp less than in 2019. For Germany full
generation
convergence with most of its neighbours decreased, mainly due to a decrease in convergence with non-CWE
neighbours.
RES support
schemes

Annual average CO2 price remained stable compared to 2019 but 2020 closed
Wholesale
at a record high 30,9 €/tCO2. Coal and Gas prices decreased compared to 2019
market
integration
This decrease in wholesale electricity prices across Europe is mainly explained by a significant decrease in annual
average natural gas (35%) and coal prices (22%). The annual average carbon emission allowance (EUA) price
remained stable around 25 €/t CO2, a -1% decrease compared to 2019. But in difference to 2019 the spread of the
Balancing EUA price over the year was much larger. In the first period after the restrictive measures were implemented the
EUA price dropped to 15 €/tCO2. Ever since the EUA price increased, closing 2020 at a record high of 30,9
€/tCO2 almost 6 €/tCO2 higher than the annual average. The effect of these changes in fuel and carbon prices
Congestion
management
resulted from January until October in coal-to-gas switching due to higher generator margins for gas-fired power
plants compared to coal-fired power plants in both the Dutch and German markets.

3 7 April 2021
 Main Findings (2/3)
Introduction
The Netherlands became a net exporter in 2020 for the first time since 1981
Germany significantly reduced hard coal, lignite and nuclear in it’s power mix
Main
findings
The Netherlands reached a net export position over 2020 for the first time since 1981. This coincided with an
increase in total generation. As a consequence of coal-to-gas switching, generation based on natural gas
significantly increased and generation based on coal significantly decreased. Generation from wind and solar
Wholesale
increased with 40% to 23 TWh. Additionally around 4,2 TWh of biomass co-firing in coal-fired power plants was
market prices
certified, meaning 4,7 TWh of total generation in coal-fired power plants can be attributed to the biomass co-firing.

Fuel prices &

Total generation in Germany decreased with 26 TWh (-5%) over 2020. Generation from the most carbon intensive
generators polluters hard coal and lignite decreased most with a combined reduction of 33 TWh compared to 2019. Whereas
nuclear decreased 10 TWh (-14%). These reductions were partly offset by the increase of Gas 9 TWh (+17%),
Solar and Wind 11 TWh (+6%) and a reduced export position.
Capacity &
generation

26 GW and 55 TWh/yr RES is granted subsidy under the Dutch SDE+

RES support
RES in Germany reached almost 250 TWh in 2020 and 33 B€ in EEG costs
schemes

In 2020 round I, less funds were made available for SDE+ subsidies compared to previous SDE+ rounds. Solar
projects still had the largest share in allocated SDE+ subsidies by 2,2 B€ in 2020 round I. The cumulative
Wholesale
market development of awarded projects in SDE+ show more than 26 GW of renewable capacity is expected to be
integration
installed which accounts for an annual generation of around 55 TWh, of which 11 TWh by unsubsidised offshore
wind.

Balancing
Total generation of renewables in Germany reached almost 250 TWh. The corresponding costs in 2020 are
estimated to be around 33 B€. Recent Feed-in-Premium auctions show most tenders in which the available
volume remains untendered and prices clear at the installed cap of around 6,2 ct€/kWh. The available tender
Congestion
management volume for solar was awarded in all recent auctions, clearing around 5,3 ct€/kWh.

4 7 April 2021
 Main Findings (3/3)
Introduction
Increased prices capacity for Dutch FRR in 2020 compared to 2019
Introduction of 4-hour products for FCR and a decrease of the common price
Main
findings Capacity prices for Dutch Frequency Restoration Reserves (FRR) increased in 2020. This effect can partly be
contributed to the increase in contracted capacity. The increased demand for upwards capacity is the result of the
dimensioning of mFRR+aFRR that increased due to the operational return of Claus C 1.340MW in 2020.
Wholesale
market prices
Rather stable German aFRR prices throughout 2020 with slightly increased volumes compared to 2019 as an
outcome of new dynamic dimensioning approach for both aFRR and mFRR volumes (determined for each 4-h-
Fuel prices & product timeframe individually).
generators

Capacity prices for Frequency Containment Reserves (FCR) for the common region decreased in 2020 compared
Capacity &
to 2019. For the Dutch share of FCR the prices increased. Furthermore, since July 2020, FCR capacity is
generation auctioned daily for 4-hour products instead of for daily products.

Dutch congestion management costs increased 27% in 2020 compared to 2019

RES support
schemes
whereas German costs remained comparable to 2019
Costs for congestion management in the Netherlands increased to €77,6 million in 2020(+27%). Most costs were
Wholesale related to redispatch, and a smaller share can be attributed to restriction contracts, which are contracts with
market
integration market parties to withhold a share of production for a certain period. Across the border in Germany, cost for
congestion management in the first three quarters (Q4 data unavailable yet) of 2020 were in the order of €1 billion,
comparable.
Balancing

83 GWh of redispatch volume was contracted through the GOPACS platform in 2020. In September 2019 the first
Intraday Congestion Spreads (IDCONS) were activated via the Grid Operators Platform for Congestion Solutions
Congestion (GOPACS). GOPACS is a TSO-DSO coordinated market-based congestion management platform that enables
management
intraday bids with a geo-tag to be used for congestion management as well (see for more info www.gopacs.eu).

5 7 April 2021
Wholesale
market prices

6 7 April 2021
 Market Timeframes
Introduction
The wholesale market consists of several sub-markets

Main
Market Timeframe and Balancing
findings

Wholesale
market prices

Fuel prices &

generators

Capacity &
generation

RES support
schemes

Wholesale
market
integration

■ The figure above shows the relation between the different timeframes of the wholesale market and the balancing market.
In wholesale markets, electricity generators sell electricity to large industrial consumers and electricity suppliers. The
Balancing
electricity suppliers sell electricity to the final consumer in retail markets. The scope of this Annual Market Update is on
wholesale markets.
■ Balancing and redispatch are system services that are important features of the electricity system. TSOs procure

Congestion
balancing reserves that can be activated in real-time to resolve disruptions in system balance. Also, TSOs perform
management network security analyses to identify congestion, which is resolved by activating redispatch.

7 7 April 2021
 Day-ahead prices Europe
Introduction
2020: significant decrease of day-ahead prices across Europe

Main Yearly Average DA Prices Europe

findings 2019 2020

Wholesale
market prices

€ / MWh

60
Fuel prices &
generators
50

40
Capacity &
generation
30

20
RES support
schemes
10

Wholesale
market
integration

Balancing ■ Annual average day-ahead prices of almost all European countries significantly decreased from 2019 to 2020.
■ Norway and Sweden experienced the steepest decline in the range of 60% - 80 %.
■ Denmark, Spain and Finland experienced a decrease around 30%.
Congestion
management ■ In most other countries the decrease as in a range of 20% - 25%.

8 7 April 2021 Source: MRC Market Coupling

 Day-ahead prices CWE
Introduction
Prices significantly decreased in spring in response to Covid-19 related
restrictions
Main Monthly Average Day-ahead Wholesale Prices in the CWE region
findings

€/MWh
100
-22%
Wholesale 90
market prices
80
70

Fuel prices &

60 -19%
generators
50
40

Capacity &
30
generation
20
10
0
RES support
schemes J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D
2018 2019 2020
NL BE DE/AT* DE* AT* FR yearly average
Wholesale * On October 1st, 2018 the German/Austrian bidding zone split into two separate bidding zones
market
integration ■ The average day-ahead (DA) electricity price decreased within the Central Western European (CWE) region by 19% to 32
€/MWh.
■ Overall, DA prices in the CWE region decreased, mainly due to effects of the restrictive measures that most governments
took in response to the Covid-19 pandemic. These resulted in a decrease in demand for electricity and gas, which pushed
Balancing
down the marginal cost for generators which in return lead to a significant drop in average DA prices. Also the increase of
renewables had a price damping effect. Additionally within the CWE region DA prices had a high level of convergence
relative to 2018.
Congestion ■ Demand for gas and electricity increased again after the relieve of measures around May and June. These were price lifting
management
effects, for both gas and electricity, contributing to the increase in DA prices since May. In addition, also typical fall and winter
uncertainty regarding nuclear availability in France and Belgium contributed to higher prices because of tight availability.
9 7 April 2021 Source: MRC Market Coupling
 Day-ahead prices – price volatility
Introduction
Price volatility increased in 2020

Main Spread of Day-ahead prices in selected European countries

findings 2019 2020

€/MWh €/MWh
100 100 95%
Wholesale Other CWE Other
market prices
CWE percentile
90 90
75%
80 80 percentile
median
Fuel prices & 70 70
generators
25%
60 60 percentile

50 50 5%
Capacity & percentile
generation
40 40

30 30

RES support 20 20
schemes
10 10

0 0
Wholesale
market AT DE BE FR NL GB DK1 DK2 NO2 SE4 PL CZ CH AT DE BE FR NL GB DK1 DK2 NO2 SE4 PL CZ CH
integration

Balancing
■ Higher volatility in general in almost all selected countries and smaller differences in volatility between CWE countries in
2020 compared to 2019. Because prices were lower in Q2 2020 compared to 2019 partly due to the covid-19 related
restrictions and higher in Q4 2020 compared to 2019, the volatility over the year increased.
■ Norwegian prices mostly set by the marginal opportunity cost of hydro, these costs were low in 2020 due to the high
Congestion
management availability of hydro stocks as a result of melting water.

10 7 April 2021 Source: MRC Market Coupling

 Day-ahead prices CWE – negative prices
Introduction
Increase of hours per year with negative prices within CWE and neighbours

Main Negative Day-ahead Wholesale Prices Example: 21-4-2020 German Day-ahead wholesale prices and electricity mix
findings

Nr. of hours GW €/MWh

350 100 50
CWE Other
Wholesale 90
market prices 300
80 0

250 70
Fuel prices & 60 -50
generators 200
50
150
40 -100
Capacity &
generation 100 30

20 -150
50
10
RES support
schemes 0 0 -200
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
4
E

FR

H
K1
K2

2
BE

B
AT

Z
PL
O
N

SE
D

C
C
D
D
N

21-4-2020
2018 2019 2020 Nuclear Lignite Hard Coal Gas
Wholesale Pumped Storage Other Wind Solar
market
integration Load DA price DE
■ The number of hours per year at which day-ahead markets cleared at negative prices increased in the CWE region, GB, and
some Nordic bidding zones. Germany reached 297 hours of negative prices which is 3,5% of all hours in 2020.
■ The example shows the day-ahead prices and hourly generation mix in Germany on a day with significant negative prices.
Balancing
■ Negative prices as outcome of the day-ahead auction signal the willingness of producers to pay off takers of their power. This
is possible because there are also other remunerations beside the day-ahead market. If those remunerations exceed the
costs for negative prices at day-ahead, a positive return is still made. Remunerations can come from a.) other markets, e.g.
Congestion
management must-run installations for heat, b) network operators, e.g. support system quality, or c) governments, e.g. regulation /
subsidies for renewables. In addition, less-/in-flexible thermal power plants that incur heavy start/stop costs and risks will
accept a negative price if these costs are lower than the start/stop costs + risks.
11 7 April 2021 Source: MRC Market Coupling; Fraunhofer Energy Charts www.energy-charts.de
Fuel Prices &
Generators

12 7 April 2021
 Fuel Prices
Introduction
Natural Gas Prices decreased with 35%, Coal prices decreased with 22% on
average compared to 2019
Main Natural Gas Prices Coal Prices
findings
€/MWhth €/MWhth
-28%
30 14
-36%
Wholesale
market prices
12
25

10 -22%
Fuel prices &
20
generators -35%
8
15
6
Capacity &
generation 10
4

5 2
RES support
schemes
0 0
2018 2019 2020 2018 2019 2020
Gas price Yearly average Coal price Yearly average
Wholesale
market
Gas prices are based on OTC natural gas prices at the Dutch virtual Coal prices are based on the over the counter API#2
integration exchange Title Transfer Facility (TTF). price index.
■ Fuel prices decreased on decreased demand for fuel induced by tough restriction measures of European governments in
response to Covid-19.
Balancing
■ Natural gas demand decreased for both the industrial sector as well as the electricity sector, resulting in a drop in Natural
gas prices of 35%.
■ Coal prices decreased with 22%. This was affected partly due to a decrease in demand for power as well but more

Congestion
particularly by a reduced demand for power from coal-fired generation due to uncompetitive margins (see Generator
management Margins NL and DE).

13 7 April 2021 Source: energate

 Carbon Prices
Introduction
Year-on-year carbon prices remained stable around 25 €/tCO2 in 2019 and 2020
Closing carbon price in 2020 reached a record high of 30,9 €/tCO2
Main CO2 Emissions Allowance (EU ETS) Prices
findings

€/tCO2

35
Wholesale
market prices
+61% -1%

30

Fuel prices & 25

generators

20

Capacity & 15
generation

10

RES support
schemes 5

0
Wholesale 2018 2019 2020
market
integration CO2 price Yearly average
■ After the CO2 Emission Allowances price stabilised around 25 €/tCO2 during 2019, the yearly average price for 2020
remained rather stable with a year-on-year decrease of 1%.
■ Volatility was much higher in 2020 with lower dips and higher peaks. The strong dip occurred when Europe responded to
Balancing
the covid-19 pandemic with heavy restrictions. The peak marked a record high of 30,9 €/tCO2 by the end of 2020, closing
the year almost 6 €/tCO2 higher than the yearly average.
Congestion
■ The upwards trend of the CO2 Emission Allowances prices in 2020 is partly the result of the new agreed EU Green Deal.
management The 40% CO2 Emission reduction target for 2030 compared to 1990 emissions is lifted towards 55%.

14 7 April 2021 Source: energate

 Generator Margins NL
Introduction
Coal-to-gas switching from January to November
Negative spreads coal- and gas-fired generation in April and May
Main Dutch Monthly Average Clean Dark Spread and Clean Spark Spread
findings

€/MWh
30
Wholesale
market prices
20

Fuel prices & 10

generators

Capacity &
generation
-10

RES support
-20
schemes J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D
2018 2019 2020
Wholesale Clean Dark Spread Base Clean Dark Spread New Clean Spark Spread Base Clean Spark Spread Peak
market Assumptions
integration
Coal: efficiency Base 40%, New 45%, emission factor 91,7 tCO2/TJth, heating value 25,1 MJ/kg; Gas: efficiency Base & Peak 55% emission factor 55,6 tCO2/TJth,.
■ At the start of 2021, up to November, the Clean Dark Spread Base and new (for modern high efficient coal-fired power
plants) decreased below the Clean Spark Spread Base suggesting coal-to-gas switching. This indicates the point at which
Balancing it is more profitable to produce electricity from natural gas than from coal.
■ The effects of coal-to-gas switching in the actual monthly generation mix (Generation in the Netherlands) shows a
significant decrease in generation from coal-fired power plants and an increase in the generation of gas-fired power
Congestion
plants. In June and July the difference between the Clean Spark spread base and the Clean Dark spread base and new
management was highest, resulting in the lowest contribution of Coal-fired generation in the generation mix.

15 7 April 2021 Source: energate, MRC Market Coupling

 Generator Margins DE
Introduction
Negative spreads for Base gas-fired generation from February till May and for
Base coal-fired generation from January till August
Main German Monthly Average Clean Dark Spread and Clean Spark Spread
findings

€/MWh
30
Wholesale
market prices
20

Fuel prices &

10
generators

Capacity &
generation
-10

-20
RES support
schemes J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D
2018 2019 2020
Wholesale Clean Dark Spread Base Clean Dark Spread New Clean Spark Spread Base Clean Spark Spread Peak
market
integration Assumptions
Coal: efficiency Base 40%, New 45%, emission factor 91,7 tCO2/TJth, heating value 25,1 MJ/kg; Gas: efficiency Base & Peak 55% emission factor 55,6 tCO2/TJth,.
■ The German Clean Dark and Clean Spark Spreads show a similar pattern. Coal-to-gas switching occurs as well from
January till November. Exception to the Dutch pattern is the negative margins in February till May (clean spark spread
Balancing
base) as a result of high renewable in-feed in Germany suppressing monthly average day-ahead prices down below
healthy margins of both coal- and gas-fired power plants.
■ This effect was amplified by reduced loads all over Europe due to Covid-19 related restrictions. In April the Clean Spark

Congestion
Spread Peak was even lower than the Base (in both NL and DE), signalling that day-ahead prices during the day were
management lower than the daily average prices.

16 7 April 2021 Source: energate, MRC Market Coupling

Capacity &
generation

17 7 April 2021
 Capacity in the Netherlands
Introduction
Main capacity increase by Solar PV, which grew by 3,1 GW
1,9 GW of mothballed capacity was made operational again
Main Dutch Operational Capacity Dutch Mothballed Capacity Changes (Δ2020-2019)
findings
GW GW GW
45 4 8 7,3
41
Wholesale
market prices
40
6
35 33 2,9
31 3 2,8

Fuel prices & 30 4

generators

25
2 2
20
Capacity &
generation
15 0
1
10 0,6
RES support -2
schemes 5 -2,2
0 0 -4
Wholesale 2018 2019 2020 2018 2019 2020 Operational Mothballed
market
integration Solar Offshore wind Onshore wind Biomass Hydro
Oil Natural gas Hard coal Nuclear Other
The figures represent the end-of-year installed capacity as observed on December 31st of 2018, 2019 and 2020
■ Operational capacity increased by 7,3 GW, roughly half is the result of solar PV which grew by 3 GW in 2020. Onshore
Balancing
wind accounted for 1 GW. The 1,4 GW additional offshore wind capacity are the first two out of five 700 MW offshore wind
sites that were part of the 2013 energy agreement, Borssele I&II 700MW and III&IV 700MW.
■ Due to improved market conditions for gas-fired power plants (see Fuel Prices & Generators ) almost all mothballed
Congestion
management capacity re-entered the market with 1,9 GW, of which the Claus C gas-fired power plant with 1,3 GW is the largest
connection. Because this is the largest single connection in the Dutch grid this also had implications for the dimensioning
of the FRR capacity (see Balancing).
18 7 April 2021 Source: TenneT NL, CBS
 Generation in the Netherlands
Introduction
Reduced coal-fired and increased gas-fired and biomass co-firing generation
Record high export volumes in July and August
Main Dutch Yearly Gross Electricity Generation Dutch Monthly Generation, net Imports and Exports
findings
TWh TWh

120 12
Wholesale 100 102
market prices
100 94 10

8
80
Fuel prices &
generators 6
60
4
Capacity & 40
generation 2

20 0
RES support
schemes 0 -2
2018 2019 2020 J FMAM J J A SOND J FMAM J J A SOND J FMAM J J A SOND
2018 2019 2020
Wholesale
market Nuclear Hard coal Certified co-fired biomass Waste Natural gas Wind Uncategorized
integration
Net import (+) / export (-) Load + grid losses
*Generation shown is electricity infeed measured on public grids: ~82-85% of total NL generation. Uncategorised: units <10MW.
Solar generation and some onshore wind not available in measurements. .
■ In June and July the difference between the Clean Spark spread base and the Clean Dark spread base and new was
Balancing
highest, resulting in the lowest contribution of Coal-fired generation in the generation mix (Generator Margins NL).
■ Biomass co-firing increased in 2020 up to 4,5 TWh, this is still 2,1 TWh short of the expected 6,7 TWh annual generation
expected from the SDE+ subsidies when co-firing of biomass will be fully reached (NL: Cumulative development SDE+)
Congestion
management ■ July and August had record high exports due to the high competitiveness of the Dutch gas dominated generation mix.
Monthly average day-ahead prices were lowest within the CWE region and the difference between the clean spark spread
and clean dark spread was highest in these months.
19 7 April 2021 Source: TenneT NL, CertiQ
 Solar and Wind Generation in the Netherlands
Introduction
Offshore wind generation increased up to 6 TWh in 2020
Solar generation increased up to 8 TWh in 2020
Main Dutch Solar and Wind Generation annually and monthly
findings

TWh TWh
25 2,5

Wholesale
market prices

20 2,0

Fuel prices &

generators
15 1,5

Capacity & 10 1,0

generation

5 0,5
RES support
schemes

0 0,0
2018 2019 2020 J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D
Wholesale
market 2018 2019 2020
integration Solar Wind onshore Wind offshore

■ Solar generation increased most of the weather dependent renewable generation sources in the Netherlands up to 8 TWh
Balancing (+49%) , a logical consequence of the 3 GW installed capacity increase in 2020.
■ Offshore wind generation increased most relatively with an increase of 66% growing towards 6 TWh generation in 2020.
This was the result of the first two offshore wind sites from the 2013 energy agreement, Borssele I&II 700MW and III&IV
Congestion 700MW, which started generating in 2020.
management
■ The monthly pattern shows that wind and solar were complementary on a monthly aggregated level with typically more
solar in the summer and more wind in the winter. Variability on an hourly or daily level is significantly larger.
20 7 April 2021 Source: energieopwek.nl
 Capacity in Germany
Introduction
Increase in RES and Gas-fired Generation, reduction of hard coal-fired generation
Strategic reserve implemented in 2020 for the first time
Main German Operational Capacity German Reserve and Mothballed Capacity Changes (∆2019-2020)
findings
GW GW GW
250 12 10 8,8

211 213 8
Wholesale 204 9,6
market prices
10
200 6
8,3
8 4
150
Fuel prices & 2
generators
6
0
100
-0,3
4 -2
Capacity & -1,3
generation 2,3
2,0 -4
50
2
-6
-6,1
RES support 0 0 -8
schemes 2018 2019 2020 Reserves* Mothballed Reserves Mothballed Operational Reserves Mothballed
2019 2020
Solar Offshore Wind Onshore wind Biomass Hydro Other
Wholesale
market
Oil Natural gas Lignite Hard coal
integration * Consist of ‘Sicherheitsbereitschaft’ outside market back-up capacity, and ‘Netzreserve’ used for congestion management
■ Operational capacity increased by 2 GW. PV solar grew by roughly 4 GW and wind by 2 GW while coal capacity
decreased by almost 4 GW. More than 1 GW of gas-fired capacity from reserves came back into the operational fleet due
Balancing
to improved market conditions (Generator Margins DE).
■ Strategic reserve scheme introduced in Oct. 2020. For first delivery period a total of ca. 1 GW gas-fired capacity
contracted. This capacity is kept outside the market. The strategic reserves are plotted in the operational capacity
Congestion
category in this classification of the Kraftwerklisste from the Bundesnetzagentur.
management
■ According to nuclear phase-out plans, one nuclear power plant was shut down in 2020 (ca. 1 GW).

21 7 April 2021 Source: Kraftwerkliste Bundesnetzagentur, ENTSO-E Transparancy Platform

 Generation in Germany
Introduction
Overall generation in Germany decreased in 2020 compared to 2019
Largest reduction for hard coal, lignite and nuclear generation
Main German Yearly Gross Electricity Generation
findings

TWh TWh
600 60
537
516
Wholesale
490
market prices
500 50

40
400
Fuel prices &
generators 30
300
20
Capacity & 200
generation 10
100 0

RES support
schemes
0 -10
2018 2019 2020 J FMAM J J ASOND J FMAM J J ASOND J FMAM J J ASOND
2018 2019 2020
Wholesale
market
Nuclear Hard coal Lignite Biomass Oil Natural gas Hydro Wind Solar Uncategorized
integration
Net import (+) / export (-) Load

■ Total generation in Germany decreased in 2020 compared to 2019 with 26 TWh (-5%). Generation from hard coal
decreased with 13 TWh (-27%) lignite with 20 TWh (-20%) and nuclear with 10 TWh (-14%). This reduction was partly
Balancing
offset by the increase in gas 9 TWh (+17%) solar and wind 11 TWh (+6%) and a reduced net export position.
■ Biomass and hydro based generation remained a similar generation output over the past three years.
■ Total generation and load in Q2 2020 seems to be significantly below the generation and load in the same period in 2018
Congestion
management and 2019 which likely shows some effect of the Covid-19 related restrictions on the total consumption in Germany.

22 7 April 2021 Source: Fraunhofer Energy Charts www.energy-charts.de

 Solar and Wind generation in Germany
Introduction
Solar generation increased 9,5% compared to 2019

Main Annual and Monthly Solar and Wind Generation Germany

findings

TWh TWh
200 25
Wholesale 180
market prices

160 20

140
Fuel prices &
generators
120 15

100
Capacity & 80 10
generation

60

40 5
RES support
schemes
20

0 0
Wholesale 2018 2019 2020 J FMAMJ J ASOND J FMAMJ J ASOND J FMAMJ J ASOND
market
integration
2018 2019 2020
Solar Wind

■ In 2020 Solar generation was up 9,5% compared to 2019, reaching 51 TWh which was a logical consequence of the
Balancing
4 GW additions in solar capacity. Wind generation increased only marginally up to 132 TWh (+3,5%)
■ The monthly pattern shows that wind and solar were complementary on a monthly aggregated level by typically more
solar in the summer and more wind in the winter. Variability on an hourly or daily level are likely to be significantly larger.
Congestion
management

23 7 April 2021 Source: Fraunhofer Energy Charts www.energy-charts.de

RES support
schemes

24 7 April 2021
 NL: Budget Distribution SDE+
Introduction
Decreased budget for SDE+ since 2019
Solar taking around half of the 2020 round I available budget
Main Budget Distribution per SDE+ Round
findings

Billion € ■ The SDE+ is an operating (feed-

14 in-tariff) subsidy. Producers
receive a guaranteed payment
Wholesale
market prices (subsidy) for the energy they
12 generate from renewable sources.
■ In relation to the expected
Fuel prices & 10 technological improvements and
generators
associated cost reductions, the
available SDE+ budget is
8 decreasing. This decision was
Capacity &
generation
made to ensure sufficient
6 competition in development of
renewable energy projects.
■ In 2020 round I, several subsidy
RES support 4
schemes requests were rejected due to
insufficient adherence to
2 requirements set by the
Wholesale
market
Netherlands Enterprise Agency
integration
(RVO).
0
2012 2013 2014 2015 2016 I 2016 II 2017 I 2017 II 2018 I 2018 II 2019 I 2019 II 2020 I ■ Available grid capacity became
part of the requirements for the
Solar Onshore wind
Balancing project assessments since 2019
Biomass co-firing Hydro round II.
Heat/gas/CHP/all other technologies Rejected submissions ■ Solar took slightly more than half

Congestion
Available budget of the budget for 2020 I, almost
management no budget was allocated to wind
onshore projects.

25 7 April 2021 Source: RVO

 NL: Cumulative development SDE+
Introduction
Over 26 GW renewable electricity capacity is projected to be installed under the
SDE+ subsidy scheme
End of Year Cumulative Capacity to be installed under End of Year Cumulative Electricity Generation to be generated
Main
findings SDE+ annually under SDE+

GW TWh/yr
30 60
Wholesale
market prices
25 50

Fuel prices & 20 40

generators

15 30
Capacity &
generation
10 20

RES support 5 10
schemes

0 0
Wholesale
market
2012 2013 2014 2015 2016 2017 2018 2019 2020 2012 2013 2014 2015 2016 2017 2018 2019 2020
integration Solar Onshore wind Biomass co-firing Hydro Offshore wind Offshore wind unsubsidised
*Note that 2020 round II is excluded in 2020 figures
■ After 8,5 years of SDE+ subsidy schemes, more than 26 GW of awarded capacity of solar, on- and offshore wind, hydro,
biomass co-firing is in operation or is planned to be installed. 2,3 GW of this capacity is unsubsidised offshore wind.
Balancing
■ This cumulative capacity will be good for 55 TWh annual generation of which 11 TWh from unsubsidised offshore wind.
With an annual consumption of 117 TWh in 2018 (AMU 2018), renewable generation resulting from SDE+ subsidies
(excluding the unsubsidised offshore wind) would correspond to 38% of total annual consumption.
Congestion
management ■ A clear discrepancy is seen between awarded capacity and awarded electricity generation. Even though the majority of
capacity was awarded to solar in recent years, electricity generation from wind is higher. This can be attributed to the
higher load factor of these technologies.
26 7 April 2021 Source: RVO
 DE: Cumulative development EEG payments
Introduction
Increased total EEG payments for 2020
End of Year Cumulative Payments to Renewable Support Renewable Generation
Main Scheme (EEG)
findings

Billion € TWh

Wholesale
35 300
market prices

30
250

Fuel prices & 25

generators
200
20
150
Capacity &
generation 15
100
10
RES support
schemes
5 50

0 0
Wholesale
market 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
integration
Solar Biomass Onshore wind Offshore wind Hydro Total Solar Biomass Wind Hydro

Balancing
■ Overall lower electricity wholesale price level led to a substantial increase in payments to renewable generators under the
EEG scheme in 2020 (in total: 33,1 billion €; numbers preliminary)
■ As a result, for the first time in the history of the Renewable Energy Sources Act, the EEG surcharge was subsidized by
Congestion
management federal funds. The surcharge was fixed at 6,5 ct/kWh for 2021. It would otherwise have risen to 9,7 ct/kWh

27 7 April 2021 Source: Bundesnetzagentur

 DE: Development of feed-in premiums
Introduction
Level of feed-in premiums (FiP) for new onshore wind installations remains
constant in 2020 with awarded FiP close to bid cap of 6,2 ct€/kWh
Main EEG Auction results for the onshore wind Feed-in Premiums (FIP)
findings

MW ct€/kWh

1.500 10
Wholesale
market prices

1.200 8
6,2 6,3 6,1 6,1 6,2 6,2 6,2 6,1 6,2 6,1 6,1 6,1 6,2 6,1
Fuel prices & 5,7 5,7
generators
900 6
4,7
4,3
3,8
Capacity & 600 4
generation

300 2
RES support
schemes

0 0
05-2017

08-2017

11-2017

02-2018

05-2018

08-2018

10-2018

02-2019

05-2019

08-2019

09-2019

10-2019

12-2019

02-2020

03-2020

06-2020

07-2020

09-2020

10-2020
Wholesale
market
integration

awarded capacity (MW) tendered volume (MW) average awarded FiP bid cap

Balancing
■ As in 2019, undersubscribed auctions in 2020 indicate a rather low degree of competition among bidders. As a result,
awarded feed-in premiums on average close to bid cap of 6,2 ct€/kWh.
■ In total, only 2,3 GW of capacity was awarded in 2020 (2019: 1,8 GW). This awarded capacity is still significantly below

Congestion
the politically set target for new onshore wind capacity. As a consequence, no significant increase of new wind capacity
management coming online in the next years to be expected.

28 7 April 2021 Source: Bundesnetzagentur

 DE: Development of feed-in premiums
Introduction
Average FiP for new PV installations (> 750 kW) in 2020 continues to be in the
range of 5,2 ct€/kWh
Main EEG Auction results for the PV solar Feed-in Premiums (FIP)
findings

MW ct€/kWh
1.500 10
Wholesale
market prices

1.200 8
6,6 6,6
Fuel prices & 5,7 5,5 5,6
generators
900 5,2 5,3 5,2 5,2 5,2 6
4,9 4,8 4,9 5,0
4,6 4,7
4,3

Capacity & 600 4

generation

300 2
RES support
schemes

0 0
05-2017

08-2017

11-2017

02-2018

05-2018

08-2018

10-2018

02-2019

05-2019

08-2019

09-2019

10-2019

12-2019

02-2020

03-2020

06-2020

07-2020
Wholesale
market
integration

awarded capacity (MW) tendered volume (MW) average awarded FiP bid cap

Balancing
■ In contrast to tenders for new wind capacity, auctions for new PV installations larger than 750 kW were all oversubscribed
in 2020 leading to more competition among project developers as also reflected in the average awarded FiP being lower
than the maximum bid size (bid cap of 7,5ct€/kWh).
■ Lowest submitted bid in 2020 was 3,55 ct€/kWh showing the high degree of maturity and cost competitiveness large PV
Congestion
management projects have reached.

29 7 April 2021 Source: Bundesnetzagentur

Wholesale market
integration

30 7 April 2021
 Aggregated Exchange EU
Introduction
Shift from importer to exporter in the Netherlands, Spain and Ireland
Reduced exports in France and Germany, reduced imports in the UK and Italy
Main Yearly Aggregated Import and Export Volumes
findings 2019 2020

TWh/year
Net export
Wholesale
market prices 70

30
Fuel prices &
generators
0

-30
Capacity &
generation

-70

RES support
schemes

Wholesale
market
integration

■ The Netherlands, Spain and Ireland shifted from a net import position in 2019 towards a net export position in 2020.
These three countries have a significant share of gas-fired capacity in their generation mix. The increased and very
Balancing
competitive margins for gas fired generation made these countries more competitive with net exports as a result.
■ France and Germany exported less electricity in 2020 compared to 2019, whereas the UK and Italy imported less.
■ Norway increased it’s export position significantly due to a very competitive generation mix of hydro power and a high
Congestion
management availability of the hydro buffers.

31 7 April 2021 Source: ENTSO-E Transparency Platform

 Cross-border Flows 2019
Introduction
Most NL imports came from DE and most exports went to the UK
Most DE imports came from FR and most exports went to CH
Main Physical Cross Border Flows 2019
findings

■ The Netherlands received most

of its imports from Germany (9,1
Wholesale
market prices TWh). This is complemented by
imports from Belgium (4,5TWh)
and Norway via NorNed (2,4
Fuel prices &
TWh. The majority of exports
generators were going to the UK (6,2 TWh),
followed by Belgium (5,4 TWh).
■ Germany’s main exports went to
Capacity & Switzerland (13 TWh), Austria
generation
(11.1 TWh), Poland (10,1 TWh )
and the Netherlands (9,1 TWh).
Total imports were much lower
RES support
schemes
as Germany is a net exporting
country, but were mostly
received from France (14,8
Wholesale TWh), the Netherlands (2,9
market
integration TWh) and Denmark (2,7 TWh).
■ Note that this figure shows physical
flows between countries, which are
different from scheduled commercial
Balancing
exchanges between bidding zones.

Congestion
management

32 7 April 2021 Source: ENTSO-E Transparency Platform

 Cross-border Flows 2020
Introduction
Go-Live of NordLink DE-NO interconnector and Allegro DE-BE interconnector

Main Physical Cross Border Flows 2020

findings

■ NL – DE imports and exports

Wholesale were more balanced in 2020
market prices
due to a very competitive market
gas-fired based capacity mix
due to very high margins for
Fuel prices &
generators
gas-fired power.
■ Netherlands became a net
exporter in 2020.
Capacity &
■ Go-live of Allegro interconnector
generation
between BE and DE on
November 9th 2020 and
NordLink between DE and NO
RES support on December 8th 2020 resulted
schemes
in the first BE-DE and DE-NO
flows respectively.
Wholesale
■ Note that this figure shows physical
market flows between countries, which are
integration
different from scheduled commercial
exchanges between bidding zones.

Balancing

Congestion
management

33 7 April 2021 Source: ENTSO-E Transparency Platform

 Cross-border flows NL
Introduction
The Netherlands became a net exporter for the first time since 1981 with a net
export of 2,6 TWh
Main Dutch yearly import, export and net import
findings

TWh
40
Wholesale
market prices
30

20
Fuel prices &
generators

10

Capacity & 0
generation

-10

RES support
schemes -20

-30
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
Wholesale
market
integration

Import Export Net import

Balancing
■ For the first time since 1981 the Netherlands became a net exporter of electricity. This was mainly the result of decreased
imports that show a decreasing trend since 2014 (with an exception for 2018). Exports have remained relatively stable
within a range of 18 TWh to 22 TWh since 2014.
■ The net export position reflect the improved competitiveness of gas-fired generation, which is the main source of power
Congestion
management for the Netherlands.

34 7 April 2021 Source: CBS

 Net Positions CWE
Introduction
Increased and exporting net positions for both NL and BE
Decreased and exporting net positions for Germany and France
Main Spread of day-ahead net position in CWE
findings
GW Germany DE GW France FR
12 12
95% percentile
9 9
Importing | Exporting Importing | Exporting

Wholesale
market prices 6 6 75% percentile
3 3
median
0 0
Fuel prices &
25% percentile
generators -3 -3

-6 -6 5% percentile
2018 2019 2020 2018 2019 2020
Capacity & GW Netherlands NL GW Belgium BE GW Austria AT
generation 5 5 5

3 3 3

RES support 1 1 1
schemes

-1 -1 -1

-3 -3 -3
Wholesale
market
integration
-5 -5 -5
2018 2019 2020 2018 2019 2020 2019 2020
‘Net Position' means the netted sum of electricity exports and imports for each market time unit (hourly and Day-ahead in above graph) for a bidding zone
■ Both NL and BE increased their annual export position in 2020 compared to previous years by an increased amount of
Balancing
hours with a positive net position (which reflects a net export of electricity).
■ FR and DE had a decreased annual export position in 2020 compared to 2019. For France the export position is still
dominantly exporting. For Germany the net position became much more volatile with a significant increase in net importing
Congestion positions.
management
■ Austria remained a dominant net import position with a slight increase in volatility.

35 7 April 2021 Source: MRC Market Coupling

 Price Areas in CWE
Introduction
Stable amount of hours with full price convergence in 2020 compared to 2019,
higher compered to 2018
Main Monthly Distribution of Day-ahead Price Areas in the CWE Region
findings
DE / AT
Bidding zone split
100%

Wholesale 90%
market prices

80%

70%
Fuel prices &
generators
60%

50%
Capacity &
generation 40%

30%

RES support 20%

schemes

10%

Wholesale 0%
market J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D
integration
2018 2019 2020
1 2 3 4 5 Yearly average

■ The figure shows the time distribution of the number of day-ahead price areas in the CWE region bidding zones. When
Balancing
there is one price area, full price convergence occurs (all bidding zones have the same price).
■ There was full price convergence (1 price area) for 43% of the time in 2020, which is almost equal to 42% in 2019 and
significantly higher than the 33% in 2018.
Congestion
management ■ Full price convergence in 2020 was highest in June with 65% and lowest in January with 28%.

36 7 April 2021 Source: MRC Market Coupling

 DA Price Convergence 2019
Introduction
High convergence within the CWE region & DE-DK

Main Day-ahead Price Convergence for Selected Countries in 2019

findings

■ Relatively high convergence for CWE

countries and DE-DK. Lower
Wholesale
market prices convergence between CWE and other
countries.
■ Centrally located countries that are
included in the flow-based DA market
Fuel prices &
generators coupling had higher price
convergence with each other.
■ For some bidding zone borders there
is inherently zero or low price
Capacity &
generation convergence as:
▫ Grid losses are implicitly included in
market coupling (e.g. NL-GB, NL-NO2)
▫ For explicit coupled borders, the
RES support
schemes capacity auction price needs to be
added to the DA prices (DE-PL, DE-
CZ, AT-CZ, AT-HU, all CH borders).
Wholesale
market
integration Notes for figure:
■ DA price convergence in white, black numbers
show how often the DA price was higher in that
country.
■ Percentages do not always count up to 100%
Balancing
due to rounding

Congestion
management

37 7 April 2021 Source: MRC Market Coupling

 DA Price Convergence 2020
Introduction
Similar convergence within all CWE borders in 2020 compared 2019

Main Day-ahead Price Convergence for Selected Countries in 2020

findings

■ 2020 DA price convergence

remained roughly similar to 2019
Wholesale
market prices within all CWE borders
■ Full convergence for NL with DE in
49% of the time(-1%pp) which is
comparable to 2019, and 30% of
Fuel prices &
generators the time DE prices were higher than
NL(+10%pp).
■ Between DE had the highest full
convergence with AT with 55%
Capacity &
generation which is a reduction of 1%pp
compared to 2019.
■ BE prices less often higher than FR
(-6 %pp) and less often higher than
RES support
schemes NL (-6 %pp).

Notes for figure:

Wholesale
market
■ DA price convergence in white, black
integration numbers show how often the DA price was
higher in that country.
■ Percentages do not always count up to
100% due to rounding

Balancing

Congestion
management

38 7 April 2021 Source: MRC Market Coupling

Balancing

39 7 April 2021
 Net Imbalance Volumes NL
Introduction
Increased number of ISP’s in long system Imbalance Cluster

Main Imbalance Volume Distribution in the Netherlands

findings

Number of ISPs
4.000
Wholesale
market prices
3.500

3.000

2.500
Fuel prices &
generators 2.000

1.500

Capacity &
1.000
generation
500

87.5 to 100
0 to 12.5

>150
-100 to -87.5

100 to 112.5

112.5 to 125

125 to 137.5

137.5 to 150
12.5 to 25

25 to 37.5

37.5 to 50

50 to 62.5

62.5 to 75

75 to 87.5
-12.5 to 0
<-150

-150 to -137.5

-137.5 to -125

-125 to -112.5

-112.5 to -100

-87.5 to -75

-75 to -62.5

-62.5 to -50

-50 to -37.5

-37.5 to -25

-25 to -12.5
RES support
schemes

< short long>

Wholesale 2018 2019 2020 Imbalance Cluster (MWh)
market
integration

■ This figure shows the total number of Imbalance Settlement Periods(ISPs) per year in which the net system imbalance
volume fell within a certain cluster of net imbalance volumes.
■ The imbalance Volume distribution in 2020 shows some more skewedness towards the right side indicating an increase of
Balancing
the number of ISP’s in a long system Imbalance Cluster compared to the previous year.
■ Since 2013, a continuing trend was seen: a decreasing number of ISPs with low net imbalance volumes and an increasing
number of ISPs with high net imbalance volumes. This trend seems to have stopped in 2019 compared to 2018.
Congestion
management

40 7 April 2021 Source: TenneT NL

 Imbalance Price Delta NL
Introduction
Average long and short system prices increased in 2020

Main Average Imbalance Price Delta in the Netherlands

findings
€/MWh
45

Wholesale 40
market prices

35

30
Fuel prices &
generators
25

20
Capacity &
generation 15

10

RES support 5
schemes

0
J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D
Wholesale
market
2018 2019 2020
integration Short system state Long system state
Yearly average short system state Yearly average long system state
In the AMU 2018 ISPs with dual pricing were not included. In the AMU 2019 and 2020 these are included using the weighted average ISP price.

Balancing
■ The imbalance price delta is the difference between the imbalance price and the day-ahead price and can be considered
as the penalty for being in imbalance.
■ The average imbalance price delta of short system state (imbalance shortage) and of long system state (imbalance
Congestion
management surplus) were higher in 2020 than in 2019.

41 7 April 2021 Source: TenneT NL, MRC Market Coupling

 Imbalance price delta spreads NL
Introduction
Higher prices at higher imbalance volume clusters

Main Spread of Dutch Imbalance Price Delta 2020

findings

€/MWh

Wholesale 450 95% percentile

market prices
400
350 75% percentile

Fuel prices &

300 median
generators
250 25% percentile
200

Capacity &
150 5% percentile
generation
100
50
0
RES support
schemes
-50
-100 to -75

100 to 125

125 to 150
-150 to -125

-125 to -100

-25 to 0

0 to 25

25 to 50

50 to 75
-75 to -50

-50 to -25

75 to 100
<-150

>150
Wholesale
market
integration < short long>
Imbalance Cluster (MWh)
■ The figure shows the spread or variability in imbalance price delta, the difference between the day-ahead price and the
imbalance price, for certain imbalance clusters.
Balancing
■ The spread is higher at larger imbalance volume clusters, which corresponds to the principle that the incentive to stay
balanced or to help restore the system is larger with larger system imbalance volumes.
■ As was the case last years as well (see AMU 2018 and 2019), the imbalance price spread includes negative values in
Congestion
management most imbalance clusters. This can be attributed to the depressing price effect of IGCC (cooperation between TSOs to
exchange imbalance volumes in opposite directions).

42 7 April 2021 Source: TenneT NL, MRC Market Coupling

 Net Imbalance Volumes DE
Introduction
Increased number of ISP’s in long system Imbalance Cluster

Main Imbalance Volume Distribution in Germany

findings

Number of ISPs
4.500

Wholesale 4.000
market prices

3.500

3.000
Fuel prices &
generators 2.500

2.000

Capacity &
1.500
generation
1.000

500
RES support
schemes
0

>390
-30 to 0
-390 to -360

-360 to -330

-330 to -300

-300 to -270

-270 to -240

-240 to -210

-210 to -180

-180 to -150

-150 to -120

-90 to -60

-60 to -30

90 to 120
0 to 30
<-390

-120 to -90

120 to 150

150 to 180

180 to 210

210 to 240

240 to 270

270 to 300

300 to 330

330 to 360

360 to 390
30 to 60

60 to 90
Wholesale
market
integration < short long>

2018 2019 2020 Imbalance Cluster (MWh)

Balancing
■ This figure shows the total number of Imbalance Settlement Periods(ISPs) per year in which the net system imbalance
volume fell within a certain cluster of net imbalance volumes.
■ The imbalance Volume distribution in 2020 shows some more skewedness towards the right side indicating an increase of
Congestion
management the number of ISP’s in a long system Imbalance Cluster compared to the previous year.

43 7 April 2021 Source: ENTSO-E Transparency Platform

 Imbalance Price Delta DE
Introduction
Average long and short system prices increased in 2020, but Q4 prices became
very negative
Main Average Imbalance Price Delta in Germany
findings
€/MWh
80

Wholesale 60
market prices

40

Fuel prices & 20

generators

Capacity & -20

generation

-40

RES support -60

schemes

-80
J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D
Wholesale
market
2018 2019 2020
integration Long system state Short system state
Yearly average short system state Yearly average long system state

Balancing
■ The imbalance price delta is the difference between the imbalance price and the day-ahead price and can be considered
as the penalty for being in imbalance.
■ The average imbalance price delta of short system state (imbalance shortage) and of long system state (imbalance
Congestion
management surplus) were higher in 2020 than in 2019, although became significantly negative since October 2020.

44 7 April 2021 Source: ENTSO-E Transparency Platform, MRC Market Coupling

 Imbalance price delta spreads DE
Introduction
Higher prices at higher imbalance volume clusters

Main Spread of German Imbalance Price Delta 2020

findings

€/MWh
900 95% percentile
Wholesale
market prices 750
75% percentile
600
median
Fuel prices &
450
generators 25% percentile
300
5% percentile
150
Capacity &
generation 0

-150

RES support -300

schemes

60 to 120
-120 to -60

120 to 180

180 to 240

240 to 300

300 to 360
-360 to -300

-300 to -240

-240 to -180

-180 to -120

-60 to 0

0 to 60
<-360

>360
Wholesale
market < short long>
integration
Imbalance Cluster (MWh)

■ The figure shows the spread or variability in imbalance price delta, the difference between the day-ahead price and the
imbalance price, for certain imbalance clusters.
Balancing
■ A defining aspect of the current average pricing model is the local price peak around zero imbalance which is reflected in
the graph in the -60 to 0 and 0 to 60 cluster. This is a difference with the imbalance price delta of approximately zero for
small imbalance volumes in the Dutch system.
Congestion
management ■ The spread is higher at larger imbalance volume clusters, which corresponds to the principle that the incentive to stay
balanced or to help restore the system is larger with larger system imbalance volumes.

45 7 April 2021 Source: ENTSO-E Transparency Platform, MRC Market Coupling

 FCR common & Dutch auction
Introduction
4-hour products were auctioned instead of daily products since July 2020
Common annual average prices decreased, Dutch increased
Main Frequency Containment Reserve (FCR) Capacity Prices in the Common and Dutch Auctions
findings
€/MW/h
140
Pay as bid Marginal pricing Marginal pricing
< weekly auction daily auction, daily product > daily auction, 4-hour product >
Wholesale
market prices 120

100

Fuel prices &

generators
80

60
Capacity &
generation
40

20
RES support
schemes

0
M 8

N 8

M 19

N 9

M 20

N 0
Fe 8

Ju 8

Fe 9

Ju 9

Fe 0

Ju 0
M 8

Ap 8

M 19

Ap 9

M 20

Ap 0
Se 8

O 8

D 18

Ja 8

Se 9

O 9

D 19

Ja 9

Se 0

O 0

D 20
0
Ju 8

Ju 9

Ju 0
Au 8

Au 9

Au 0
1

2
1

-1

-1

-2
-1

-1

-2
l- 1

l- 1

l- 2
r-1

-1

-1

-2
1
-1

-1

-2
n-

n-

n-

n-

n-

n-
b-

b-

b-
Wholesale
g-

p-

g-

p-

g-

p-

-
r-

r-
ar

ov
ec

ar

ov
ec

ar

ov
ec
ay

ay

ay
ct

ct

ct
Ja

market
integration Dutch Dutch Average Weekly Dutch - Annual Average
Common Common Average Weekly Common - Annual Average
Note that since 01-07-2019 there is no separate auction for NL, the minimum capacity that needs to be active in the NL control area
(34MW) is a boundary condition in the common auction algorithm.

Balancing ■ From July 2020 the auction systematics changed for both the Common and Dutch Auction. The D-1 daily auctions for a
daily product were replaced with daily auctions for six 4-hour products.
■ FCR prices became more volatile due after the introduction of daily auctions in 2019. After the introduction of 4-hour
Congestion
products as of July 2020, volatility increased further.
management
■ The prices for the common auction reached a record low price of 2,50 €/MW/h at 15-12-2020 for the 17h-20h product.
Also the Dutch auction reached a record low price of 2,75 €/MW/h at 23-12-2020 for the 9h-12h.
46 7 April 2021 Source: regelleistung.net
 FCR common & Dutch auction
Introduction
Hr. 1-4 and hr. 5-8 products have the highest prices in the Common auction
High variability in prices in the Dutch Auction
Main Frequency Containment Reserve (FCR) Capacity Prices in the Common and Dutch Auctions
findings

€/MWh Common Dutch

60 60 95% percentile
Wholesale
market prices

75% percentile
50 50
median
Fuel prices &
generators 25% percentile
40 40
5% percentile
Capacity &
generation 30 30

RES support
20 20
schemes

10 10
Wholesale
market
integration

0 0
Hr. 1-4 5-8 9-12 13-16 17-20 21-24 1-4 5-8 9-12 13-16 17-20 21-24

Balancing
■ From July 2020 the auction systematics changed for both the Common and Dutch Auction. The D-1 daily auctions for a
daily product were replaced with daily auctions for six 4-hour products.
■ The Dutch market has most often the highest prices for the 9-12 and 17-20 hour blocks. For the same 4-hour products the
Congestion
management common auction has most often the lowest prices.

47 7 April 2021 Source: regelleistung.net

 aFRR in the Netherlands
Introduction
Prices for aFRR increased during 2020
Introduction of daily contracts in September
Main Contracted automatic Frequency Restoration Reserve (aFRR) Capacity Volumes and Prices in the Netherlands
findings
MW Weekly €/MW/h
600 contracts 12
Month and weekly contracts Daily contracts
Wholesale
market prices 500 10

400 8
Fuel prices &
generators

300 6

Capacity & 200 4

generation

100 2
RES support
schemes
0 0
J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D

Wholesale
2018 2019 2020
market
integration
Volume aFRR symmetrical Volume aFRR upward Volume aFRR downward Price

■ After a small decrease in prices from January to April, prices for aFRR overall slightly increased.
■ Since September aFRR is contracted on a daily basis for a 1 day period instead of Monthly and Weekly contracts. This
Balancing
was preceded by a period of two months, July and August, with only weekly contracts.
■ Since 2018, a fixed amount of capacity for aFRR and mFRRda (see next slide) combined is contracted, contracting the

Congestion
least costly combination, instead of fixed amounts for aFRR and mFRRda products separately. Therefore there is a
management variation in monthly average volumes contracted.

48 7 April 2021 Source: TenneT NL

 mFRRda in the Netherlands
Introduction
mFRRda upwards prices increased during 2020
mFRRda downwards prices remained relatively stable during 2020
Main Manual Frequency Restoration Reserve directly activated (mFRRda) Capacity Volumes and
findings Prices in the Netherlands

MW Quarterly and Monthly Weekly Daily €/MW/h

Monthly contracts contracts contracts contracts
Wholesale 1.200 12 ■ Prices for upwards mFRRda
market prices reserves increased during
1.000 10
2020. This effect can partly be
800 8 contributed to the increase in
Fuel prices & 600 6 contracted capacity. The
generators
increased demand for upwards
400 4
capacity is the result of the
200 2 dimensioning of mFRR+aFRR
Capacity &
0 0 that increased due to the
generation
operational return of Claus C
1.200 12
1.340 MW in 2020.
1.000 10 ■ Prices for downwards mFRRda
RES support
schemes slightly increased compared to
800 8
the second half of 2019 and
600 6 remained relatively table during
Wholesale
market
the year.
integration 400 4

200 2

0 0
Balancing J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D
2018 2019 2020

Volume mFRRda upward Volume mFRRda downward Price

Congestion
management

49 7 April 2021 Source: TenneT NL

 aFRR in Germany
Introduction
Introduction of balancing energy market in November 2020
aFRR prices on average lower compared to 2019
Main Automatic Frequency Restoration Reserve (aFRR) Capacity Volumes and Prices in Germany*
findings

MW €/MW/h
Mixed-pricing scheme Rather stable aFRR prices throughout■
2.500 25
2020 with slightly increased volumes
Wholesale
market prices compared to 2019 as an outcome of new
2.000 20 dynamic dimensioning approach for both
aFRR and mFRR volumes (determined
1.500 15 for each 4-h-product timeframe
Fuel prices & individually)
generators
■ Current balancing market design which
1.000 10
was re-introduced in July 2019 (following
a court ruling to abolish the mixed-price
500 5
Capacity &
generation
mechanism) proved again in 2020 to be
efficient regarding a reliable balance
0 0 service procurement. E.g., price spikes
2.500 25
like in July 2019 have not occurred ever
RES support since the mixed price system was
schemes
replaced. Extreme aFRR and mFRR
2.000 20
prices in July 2019 can partly be
attributed to the mixed-price system: low
Wholesale
market
1.500 15 balancing energy prices encouraged
integration
some BRPs to deliberately deviate from
1.000 10 schedule, in particular during periods
with high intraday prices. This has been
500 5
observed during 3 days in June 2019
Balancing leading to significant system imbalances.
In response to these system imbalances,
0 0
TSOs increased capacity volumes to be
J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D
procured which resulted in these
Congestion 2018 2019 2020
management significant price spikes.
Volume aFRR upward Volume aFRR downward Price
* Figures for 2020 include Austria (common tender to procure aFRR capacity jointly for both countries)

50 7 April 2021 Source: TenneT DE

 mFRR in Germany
Introduction
mFRR volumes decreased in 2020
Higher prices volatility for upward mFRR during in second half of 2020
Main Manual Frequency Restoration Reserve (mFRR) Capacity Volumes and Prices in Germany
findings

MW €/MW/h
2.500 Mixed-pricing scheme 25
Wholesale
■ In July 2019, mFRR upward
market prices volume was raised to 2.000 MW
2.000 20
in response to significant system
imbalances occurring in the
1.500 15 German power system on
Fuel prices &
generators
multiple days in June 2019.
1.000 10 ■ Dynamic dimensioning of
procured capacity for both
Capacity &
generation
500 5 upward and downward mFRR
since 2020 volume decreased in
0 0 2020 to previous levels of
around 1.000 MW for upward
RES support 2.500 25
schemes mFRR and 600 MW for
downward mFRR indicating that
2.000 20
effect of new dimensioning
Wholesale
market 1.500 15
approach (volume determined
integration
for each 4-h-product timeframe
1.000 10 individually).
■ In line with EB GL, a balancing

Balancing
500 5 energy market was introduced in
November 2020.
0 0
J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D
Congestion 2018 2019 2020
management
Volume mFRR upward Volume mFRR downward Price

51 7 April 2021 Source: TenneT DE

Congestion &
management

52 7 April 2021
 Redispatch Volumes NL
Introduction
Redispatch volumes remained roughly similar in 2020 compared to 2019
Most redispatch required on critical branches
Main Redispatch upwards and downwards volumes in the Netherlands
findings

GWh
+4%
180
Wholesale
market prices
160

140
Fuel prices &
generators 120
-15%
100

Capacity &
80
generation
60

40
RES support
schemes 20

0
Wholesale
J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D
market
integration 2018 2019 2020
Critical branches Other network elements Yearly average

Balancing
■ Critical branches are lines that are included in CWE flow-based market coupling, as they significantly impact and are
impacted by CWE cross-border exchanges. Redispatch takes place to ensure that grid operation remains within
operational security limits.
■ Average redispatch volumes remained roughly stable in the Netherlands with 49 GWh/month in 2019 and 51 GWh/month
Congestion
management in 2020.

53 7 April 2021 Source: TenneT NL

 Congestion Management Costs NL
Introduction
Costs for Congestion Management increased by 27% in 2020

Main Redispatch and Restriction Costs in the Netherlands

findings

mln€
35
Wholesale
market prices
30

25 +27%
Fuel prices &
generators +14%
20

15
Capacity &
generation
10

5
RES support
schemes

0
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Wholesale
market 2018 2019 2020
integration

Total costs Yearly average

Balancing
■ This figure shows redispatch and restriction costs in the Netherlands. Restriction concerns contracts with market parties to
withhold a share of production for a certain period. Total costs increased from €61,0 million in 2019 to € 77,6 million in
2020 with a slight increase of redispatch volume activated. A significant part of the cost increase is related to restriction
contracts.
Congestion
management

54 7 April 2021 Source: TenneT NL

 GOPACS
Introduction
83 GWh of redispatch volume contracted through GOPACS
Highest average IDCONS prices in January 2020 of 162 €/MWh
Main Number of congestion management request, cleared volume of IDCONS, and weighted average prices of cleared IDCONS
findings
Number of requests GWh €/MWh
80 40 200
74

Wholesale 70
market prices 30 150

60
20 100
Fuel prices & 50
generators

40 36 10 50

30 27
Capacity & 0 0
generation 21 S O N D J F M A M J J A S O N D
20
13 2019 2020
11 -10 -50
8 9
10 6 6 5 4 4
RES support
schemes 0 0 0
0 -20 -100
S O N D J F M A M J J A S O N D
2019 2020
Cleared volume Spread price Sell price Buy price
Wholesale
market
integration
■ In September 2019 the first Intraday Congestion Spreads (IDCONS) were activated via the Grid Operators Platform for
Congestion Solutions (GOPACS). GOPACS is a Dutch TSO-DSO coordinated market-based congestion management
platform that enables intraday bids with a geo-tag to be used for congestion management as well. An IDCONS is the
spread the Grid Operator pays in order for a buy and sell bid to be cleared. For a more detailed explanation visit:
Balancing
www.GOPACS.eu.
■ In total 83 GWh of redispatch volume was contracted through the GOPACS platform in 2020.
Congestion
■ Spreads were highest in January 2020 with 198 €/MWh. The average buy prices are typically around zero or negative.
management
■ Most activated redispatch volume via GOPACS in October 2020.

55 7 April 2021 Source: TenneT NL

 Redispatch Volumes DE
Introduction
Increased redispatch and countertrade
Slightly decreased EinsMan related redispatch
Main Redispatch Volumes in Germany
findings
TWh
10
-4%
Wholesale 9
market prices
8
7
Fuel prices &
generators 6
5
4
Capacity &
generation
3
2
RES support 1
schemes

0
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
Wholesale
market 2018 2019 2020*
integration
Redispatch + countertrade Netzreserve EinsMan** Yearly average
* For 2020 only costs for the first three quarters were available. ** EinsMan volumes exist only of downward adjustments.

Balancing ■ RES curtailment (EinsMan) related redispatch slightly decreased in the first three quarters of 2020, especially in Q1.
Conventional redispatch (conventional power plants > 10 MW) in combination with countertrade remained the most
common process used for solving congestion in the German grid.
Congestion
■ The contracted Netzreserve plants are called upon when redispatch availability is insufficient. For the first three quarters
management
of the 2020, the use of Netzreserve increased slightly, mostly in Q2.

56 7 April 2021 Source: Bundesnetzagentur

 Congestion Management Costs DE
Introduction
Increased redispatch costs, mainly in Q2

Main Redispatch Costs in Germany

findings
mln€
600
-7%
Wholesale
market prices 500

400
Fuel prices &
generators
300

200
Capacity &
generation
100

0
RES support Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
schemes

2018 2019 2020*

Redispatch Countertrade Netzreserve** EinsMan Yearly average
Wholesale
market * For 2020 only costs for the first three quarters were available. ** Netzreserve costs for all years were given as yearly aggregated
integration
values. Therefore, costs were equally divided over the four quarters.

■ Costs for congestion management slightly increased the first three quarters of 2020 compared to 2018, mainly due to Q2.
Biggest contribution to increasing costs due to EinsMan (high wind energy production). Netzreserve and countertrade
Balancing
costs also increased, redispatch cost decreased.
■ Congestion management costs are generally higher in winter months, due to more stressed grid conditions. Due to
different weather conditions in Q4, the overall costs in 2020 might have reached the level of 2019.
Congestion
management ■ When compared to the previous slide, redispatch measures show the lowest costs per GWh, and EinsMan the highest.

57 7 April 2021 Source: Bundesnetzagentur

Annex

58 7 April 2021
 Annex (1/2)
Day-ahead avg. price Day-ahead avg. Physical import Physical import Physical export Physical export Net export Net export position
2019 price 2020 2019 2020 2019 2020 position 2018 2019
€/MWh €/MWh TWh/year TWh/year TWh/year TWh/year TWh/year TWh/year
AT 40,1 33,1 21,1 19,5 18,0 18,1 -3,1 -1,4
BE 39,8 31,9 11,7 12,6 13,4 12,1 1,6 -0,5
CH 40,9 33,9 25,1 22,7 27,4 26,4 2,3 3,7
CZ 40,2 33,6 8,6 10,4 21,3 20,2 12,7 9,8
DE 37,9 30,5 27,5 33,3 61,3 53,1 33,8 19,8
DK1 38,6 25,0
15,0 13,5 9,3 9,0 -5,7 -4,4
DK2 39,9 28,4
EE 45,9 33,7 3,9 6,8 3,2 3,4 -0,7 -3,4
ES 47,7 33,9 15,8 10,9 9,7 16,7 -6,1 5,8
FI 44,1 28,0 16,0 8,9 3,9 6,7 -12,1 -2,2
FR 39,5 32,2 10,5 15,6 67,9 59,7 57,4 44,1
GB 48,9 39,6 24,9 23,0 2,2 4,3 -22,6 -18,8
HR 49,3 38,0 6,4 6,8 2,3 3,0 -4,1 -3,8
HU 50,4 39,0 15,0 16,9 6,8 6,5 -8,2 -10,5
IE 50,3 35,8 1,0 1,7 1,2 2,3 0,2 0,6
IT-CNOR 52,2 38,7
IT-CSUD 52,3 39,7
IT-NOR 51,3 37,8 42,7 4,1 -38,6
36,3 2,4 -33,9
IT-SARD 51,8 39,1
IT-SICI 62,7 46,1
IT-SUD 50,9 38,9
LT 46,3 34,0 6,8 6,6 2,9 2,8 -3,9 -3,8
LV 46,2 34,4 2,8 2,5 2,8 1,6 -0,02 -0,8
NL 41,2 32,2 16,9 15,6 16,7 18,2 -0,3 2,6
NO1 39,4 9,3
NO2 39,3 9,3
NO3 38,6 9,5 11,3 2,4 11,1 14,9 -0,2 12,5
NO4 38,4 8,9
NO5 39,3 11,5
PL 53,2 45,4 15,7 17,8 6,8 6,4 -8,9 -11,4
PT 47,9 34,6 6,9 11,0 3,5 0 -3,4 -11,0
SE1 38,0 14,4
SE2 38,0 14,7
9,0 3,7 35,0 23,1 26,0 19,4
SE3 38,4 21,6
SE4 39,8 26,7
SI 48,8 36,7 7,0 5,5 7,5 7,5 0,4 2,0
SK 41,5 34,0 13,4 12,9 11,7 11,8 -1,6 -1,1
59 7 April 2021
 Annex (1/2)
Unit 2018 2019 2020 Source
NL DE NL DE NL DE
Yearly average hard coal price (API#2 OTC) €/MWh.th 11,2 8,0 6,3 [1]
Yearly average natural gas price (TTF OTC monthly) €/MWh.th 22,0 14,1 9,1 [1]
Yearly average carbon price (EEX futures) €/tCO2 15,4 24,9 24,7 [1]
Yearly average Clean Dark Spread base €/MWh 13,4 6,8 2,8 0,9 -4,5 -5,1 [1,2]
Yeary average Clean Dark Spread new €/MWh 17,9 11,3 7,2 5,4 -0,5 -1,1 [1,2]
Yearly average Clean Spark Spread base €/MWh 8,6 2,0 8,7 6,8 6,1 5,5 [1,2]
Yearly average Clean Spark Spread peak €/MWh 14,3 6,7 12,4 10,6 11,5 11,8 [1,2]
Average imbalance price delta long system €/MWh 21,0 13,4 16,4 -4,3 25,4 13,8 [2,3]
Average imbalance price delta short system €/MWh 22,9 18,9 16,4 5,5 27,0 18,7 [2,3]
Yearly average FCR price Dutch auction (symmetrical) €/MW/h 21,2 15,5 20,4 [3,4]
Yearly average FCR price common auction (symmetrical) €/MW/h 13,8 9,4 7,3 [5]
Yearly average aFRR upward price €/MW/h 2,3 3,8 2,5 [3,4]
8,8 6,5 5,7
Yearly average aFRR downward price €/MW/h 0,8 3,6 2,2 [3,4]
Yearly average mFRRda upward price €/MW/h 4,8 0,5 4,1 6,1 4,0 2,7 [3,4]
Yearly avergae mFRRda downward price €/MW/h 7,1 0,1 2,5 2,3 2,1 1,3 [3,4]
Redispatch volumes GWh/year 696,3 21.181 589,5 20.235,0 610,2 [3,4,6]
Redispatch costs mln.€/year 53,9 1.304 61,0 1.206,6 77,5 [3,4,6]

Sources
1) 1) energate 2) MRC Market Coupling 3) TenneT NL 4) TenneT DE 5) regelleistung.net 6) Bundesnetzagentur

60 7 April 2021
For questions and comments please contact:
TenneT Customer Care Centre
[email protected]

Project team:
Anton Tijdink, MSc.
Dr. Mathias Hoffmann
Alexandra Giasimaki, BSc.
Rosalie Brinkman, MSc.

61 7 April 2021
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62 7 April 2021
TenneT is a leading European grid operator (Transmission System Operator
(TSO). We design, build, maintain and operate the high-voltage electricity grid
in the Netherlands and large parts of Germany and facilitate the European
energy market. We are committed to providing a secure and reliable supply of
electricity, today and in the future, 24 hours a day, 365 days a year and to
playing our role in driving the energy transition. We transport electricity over a
network of approximately 23,500 kilometres of high-voltage connections, from
wherever and however it's generated, to over 42 million end-users while
keeping electricity supply and demand balanced at all times. With close to
5,000 employees, we achieve a turnover of 4.1 billion euros and a total asset
value of EUR 23 billion. TenneT is one of the largest investors in national and
international onshore and offshore electricity grids. TenneT makes every effort
to meet the needs of society. This will require us all to take ownership, show
courage and connect with each other.
www.tennet.eu

63 7 April 2021
Confidentiality