The question posed in this workshop is not whether zonal or nodal is better - but in the case some countries wish to go to a nodal system, how would that interact with the neighboring electricity markets. Interested countries argue that under subsidiarity it is in their freedom to decide how strong to build their internal networks to avoid constraints or use smaller pricing zones or nodal pricing internally to deal with transmission constraints.
However - in implementing congestion management strategies, they need to contribute to a functioning EU power market, which poses the following questions which we would like to discuss during our workshop
What is the main difference between zonal and nodal market designs and would thus require consideration in design of coupled markets which is compatible for both aspects?
Pricing zones allow (i) intraday / short-term trading within and across zones in continuous trading (XBID) (ii) pursue re-dispatch to resolve transmission constraints within zones (iii) actors aim to deliver a balanced position, balancing within portfolio
Regions with nodal pricing (i) run real-time (and possibly intraday) auctions with implicit transmission allocation (repeated market coupling auction) (iii) actors submit unit based bids, and have incentive for unit based balancing, and use their portfolios for financial hedging.
The workshop will focus on discussion of key interfaces to
while giving member states the flexibility in choosing their congestion management approach.
Coordinated intraday day auctions (building on current market coupling) facilitate trade between regions (to allow for financial firm trade, as common in today's intraday markets)
Opening Comments: Andreas Ehrenmann (Tractebel), Maximilan Rinck (EPEX Spot)
Can the current flow-based approach be the foundation to include nodal markets for one or several countries within the existing zonal system – with definition of critical interfaces and their use in the clearing algorithm?
Opening Comment: Konrad Purchala (PSE)
What are implications for the balancing market design (i) types and definition of reserve products (ii) incentives to keep on reserves among private participants / versus virtual bids (but no private reserve contracting)
Opening Comment: Christian Nabe (Ecofys / Navigant), Julian Dyer (National Grid)
What are the institutional drivers for countries to introduce finer pricing zones up to introducing full nodal pricing systems, and what are the institutional barriers to their introduction?
Opening Comment: Karsten Neuhoff (DIW Berlin)