First ENTSO-E power bidding zone review reveals shock results

The first results of a key review of price bidding zones indicates that the French power market should be split in two while an established joint German-Austrian zone should remain in place – or even be enlarged.

The bidding zone review, being carried out by the European Network of Transmission System Operators for Electricity (ENTSO-E), is only at a preliminary results stage, with the final report not expected to surface until later this year or next year, so its findings could yet change.

“The counter-intuitive result was to enlarge Germany with Austria and split France, which is very counter-intuitive for our French friends,” the BDEW German association of energy and water’s head of energy trading Marcel Steinbach said during a panel discussion at the Energy Risk Europe conference in London on Thursday.

“It just goes to show that even if [ENTSO-E] have the resources [the bidding zones review] is not a very easy task,” he added, referring to the surprise preliminary result.

Steinbach sits on a Eurelectric-organised working group involved in the review.

Should the preliminary results become final, the brakes could in theory be slammed on the proposed split of the German-Austrian electricity power price zone, which many across the market have gone to a lot of trouble and expense to prepare for and is due to happen from 3 October 2018.

“I’m not closest to the bidding zone review, but I know the opinions of those represented by stakeholders (…) the consensus is there’s a long way to go,” European Federation of Energy Traders (EFET) electricity committee chairman Peter Styles told the panel.

The review has come up with an outcome of eight different bidding zones across Europe, and another option of 22 zones. None of these concluded that splitting Germany and Austria would be the most efficient result. christopher.somers@icis.com