Otsus

OTSUS

10.12.2024 nr 7-26/2024-009

Balti koordineeritud võimsusarvutuse ala põhivõrguettevõtjate metoodika, vastavalt

elektrisüsteemi tasakaalustamise määruse (EL) 2017/2195 artikkel 41 lõikele 1,

kooskõlastamise kohta

1. Haldusmenetluse alustamine

Elektrituruseaduse (edaspidi ELTS) § 93 lõige 6 punkti 1 kohaselt kontrollib Konkurentsiamet

Euroopa Parlamendi ja nõukogu määruses (EL) 2019/943 (edaspidi ka Siseturumäärus) ning

selle alusel kehtestatud komisjoni määrustes sätestatud tingimuste täitmist.

ELTS § 93 lõige 6 punkti 6 kohaselt Konkurentsiamet väljastab ELTS-is sätestatud juhul

kooskõlastamise otsuseid.

Euroopa Komisjoni Määrusega (EL) 2017/2195 kehtestati elektrisüsteemi tasakaalustamise

eeskiri (edaspidi ka EBGL või EBGL määrus).1

EBGL artikkel 5 lõige 3 punkti h kohaselt peab kõigi asjaomase piirkonna reguleerivate asutuste

heakskiidu saama iga võimsusarvutusala piirkonnaülese võimsuse turupõhise jaotamise

metoodika kooskõlas artikkel 41 lõikega 1.

EBGL artikkel 5 lõike 6 kohaselt, kui tingimuste või metoodika heakskiitmiseks vastavalt

käesoleva artikli lõikele 3 või nende muutmiseks vastavalt artiklile 6 on vaja rohkem kui ühe

reguleeriva asutuse otsust, peavad asjaomased reguleerivad asutused kokkuleppele jõudmiseks

omavahel konsulteerima, tegema tihedat koostööd ja kooskõlastama oma tegevuse. Kui

koostööamet esitab oma arvamuse, võtavad asjaomased reguleerivad asutused seda arvesse.

Reguleerivad asutused või vajaduse korral koostööamet peavad lõigete 2, 3 ja 4 kohaselt

esitatud tingimuste ja meetodite kohta tegema otsused kuue kuu jooksul pärast seda, kui

koostööamet või asjaomane reguleeriv asutus või asjakohasel juhul viimane reguleeriv asutus

on tingimused või meetodid kätte saanud. Ajavahemik algab järgmisel päeval pärast seda, kui

ettepanek esitati koostööametile vastavalt lõikele 2, viimasele asjaomasele reguleerivale

asutusele vastavalt lõikele 3 või vajaduse korral asjaomasele reguleerivale asutusele vastavalt

lõikele 4.

EBGL artikkel 5 lõike 7 kohaselt, kui pädevad reguleerivad asutused ei ole jõudnud

kokkuleppele lõikes 6 osutatud ajavahemiku jooksul või nende ühise taotluse korral või

koostööameti taotlusel vastavalt määruse (EL) 2019/942 artikkel 5 lõike 3 kolmandale lõigule,

võtab koostööamet kuue kuu jooksul alates esitamisest vastavalt määruse (EL) 2019/942

artikkel 5 lõikele 3 ja artikkel 6 lõike 10 teisele lõigule vastu otsuse tingimuste või meetodite

1 Kättesaadav: https://eur-lex.europa.eu/legal-content/ET/TXT/HTML/?uri=CELEX:02017R2195-20220619

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kohta esitatud ettepanekute kohta.

EBGL artikkel 6 lõike 1 kohaselt, kui koostööamet nõuab, kõik asjaomased reguleerivad

asutused ühiselt nõuavad või asjaomane reguleeriv asutus nõuab artikkel 5 lõigete 2, 3 ja 4

kohaselt esitatud tingimuste või meetodite muutmist nende heakskiitmiseks, peavad

asjaomased põhivõrguettevõtjad esitama muudetud tingimuste või meetodite ettepaneku

heakskiitmiseks kahe kuu jooksul pärast koostööameti või asjaomaste reguleerivate asutuste

taotlust. Koostööamet või asjaomased reguleerivad asutused teevad muudetud tingimuste või

meetodite kohta otsuse kahe kuu jooksul pärast nende esitamist.

EBGL artikkel 6 lõike 2 kohaselt, kui asjaomased reguleerivad asutused ei ole jõudnud

tingimuste või meetodite osas kokkuleppele kahe kuu pikkuse tähtaja jooksul või nende ühise

taotluse korral või koostööameti taotlusel vastavalt määruse (EL) 2019/942 artikkel 5 lõike 3

kolmandale lõigule, võtab koostööamet kuue kuu jooksul vastavalt määruse (EL) 2019/942

artikkel 5 lõikele 3 ja artikkel 6 lõike 10 teisele lõigule vastu otsuse muudetud tingimuste või

meetodite kohta. Kui asjaomased põhivõrguettevõtjad ei esita ettepanekut muudetud tingimuste

või meetodite kohta, kohaldatakse artiklis 4 kirjeldatud menetlust.

EBGL artikkel 38 lõike 1 kohaselt võivad vähemalt kaks põhivõrguettevõtjat omal algatusel või

asjakohaste reguleerivate asutuste taotlusel koostada direktiivi 2009/72/EÜ artikli 37 kohaselt

ettepaneku kasutada ühte järgmistest protsessidest:

a) artikli 40 kohane koosoptimeerimisega jaotamine;

b) artikli 41 kohane turupõhine jaotamine;

c) artikli 42 kohane majandusliku tasuvuse analüüsil põhinev jaotamine.

EBGL artikkel 39 lõike 1 kohaselt energia vahetamiseks ning tasakaalustamisvõimsuse

vahetamiseks või reservide jaotamiseks kasutatava sellise piirkonnaülese võimsuse tegelik

turuväärtus, mida kasutatakse koosoptimeeritud või turupõhises jaotamises, põhineb

piirkonnaülese võimsuse tegelikul või prognoositaval turuväärtusel.

EBGL artikkel 39 lõike 2 kohaselt energia vahetamiseks kasutatava piirkonnaülese võimsuse

tegelik turuväärtus arvutatakse nende pakkumuste alusel, mida turuosalised teevad järgmise

päeva turul, ning võimaluse ja vajaduse korral võetakse arvesse pakkumisi, mida turuosalised

eeldatavalt teevad päevasisesel turul.

EBGL artikkel 39 lõike 3 kohaselt tasakaalustamisvõimsuse vahetamiseks kasutatava sellise

piirkonnaülese võimsuse tegelik turuväärtus, mida kasutatakse koosoptimeeritud või

turupõhises jaotamises, arvutatakse vastavalt võimsushanke optimeerimise funktsiooniga

tehtud pakkumustele vastavalt artikkel 33 lõikele 3.

EBGL artikkel 39 lõike 4 kohaselt reservide jaotamiseks kasutatava sellise piirkonnaülese

võimsuse tegelik turuväärtus, mida kasutatakse koosoptimeeritud või turupõhises jaotamises,

arvutatakse lähtuvalt kuludest, mida tuleks vältida tasakaalustamisvõimsuse hankimisel.

EBGL artikkel 39 lõike 5 kohaselt Piirkonnaülese võimsuse prognoositav turuhind peab

põhinema ühel järgmisel alternatiivsel põhimõttel:

a) selliste läbipaistvate turunäitajate kasutamine, mis kajastavad piirkonnaülese

võimsuse turuväärtust; või

b) selliste prognooside kasutamine, mis võimaldavad piirkonnaülese võimsuse

turuhinda usaldusväärselt hinnata.

Pakkumispiirkondade vahel energia vahetamiseks kasutatava piirkonnaülese võimsuse

prognoositav turuväärtus arvutatakse lähtuvalt eeldatavatest erinevustest pakkumispiirkondade

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vaheliste järgmise päeva ning võimaluse ja vajaduse korral päevasisese turu hindade vahel.

Prognoositava turuväärtuse arvutamisel tuleb nõuetekohaselt arvesse võtta täiendavaid

asjakohased tegureid, mis mõjutavad tarbimis- ja tootmismustrit eri pakkumispiirkondades.

EBGL artikkel 39 lõike 6 kohaselt asjaomased reguleerivad asutused võivad hinnata, kas lõike 5

punkti b kohane prognoosimismeetod, sealhulgas piirkonnaülese võimsuse prognoositud ja

tegeliku turuväärtuse võrdlus, on tõhus. Kui leping on tehtud mitte varem kui kaks päeva enne

tasakaalustamisvõimsuse pakkumist, võib asjaomane reguleeriv asutus pärast kõnealust

hindamist kehtestada teistsuguse piirangu kui artikli 41 lõike 2 piirang.

EBGL artikkel 41 lõige 1 kohaselt võivad kõik võimsusarvutusala põhivõrguettevõtjad

koostada ettepaneku, milles käsitletakse meetodit, mille alusel jaotatakse turupõhise jaotamise

protsessi käigus piirkonnaülest võimsust tasakaalustamisvõimsuse vahetamiseks või reservide

jaotamiseks. Seda meetodit kasutatakse tasakaalustamisvõimsuse vahetamiseks või reservide

jaotamiseks, kui lepinguperiood on kuni üks päev ja kui leping sõlmitakse kuni üks nädal enne

tasakaalustamisvõimsuse pakkumist. Kõnealune meetod hõlmab järgmist:

a) turupõhise jaotamise protsessi kasutamist käsitlev teavitamine;

b) üksikasjalik kirjeldus, kuidas teha kindlaks sellise piirkonnaülese võimsuse tegelik

turuväärtus, mida kasutatakse tasakaalustamisvõimsuse vahetamiseks ja reservide

jaotamiseks, ning sellise piirkonnaülese võimsuse prognoositav turuväärtus, mida

kasutatakse energia vahetamiseks, ning kui see on asjakohane, siis sellise piirkonnaülese

võimsuse tegelik turuväärtus, mida kasutatakse energia vahetamiseks, ning sellise

piirkonnaülese võimsuse prognoositav turuväärtus, mida kasutatakse

tasakaalustamisvõimsuse vahetamiseks ja reservide jaotamiseks;

c) üksikasjalik kirjeldus, milline on hinnakujundusmeetod, kindel jaotuskord ja kuidas

jagatakse võimsusjaotustulu, mis on saadud piirkonnaülese võimsuse eest, mida jaotati

enampakkumistel, kus vahetatakse tasakaalustamisvõimsust või jaotatakse reserve

turupõhise jaotamise protsessi kaudu;

d) protsess, mille alusel määratakse kindlaks tasakaalustamisvõimsuse vahetamiseks või

reservide jaotamiseks jaotatud piirkonnaülese võimsuse ülemmaht lõike 2 kohaselt.

EBGL artikkel 41 lõige 2 kohaselt piirkonnaülese võimsuse jaotamine turupõhiselt piirdub

10 %-ga võimsusest, mis oli eelmisel kalendriaastal saadaval energia vahetamiseks asjaomaste

pakkumispiirkondade vahel, või uute võrkudevaheliste ühenduste paigaldamise korral, 10 %-

ga kogu kõnealuste uute võrkudevaheliste ühenduste tehnilisest võimsusest.

Seda mahupiirangut võidakse mitte kohaldada, kui leping on tehtud kuni kaks päeva enne

tasakaalustamisvõimsuse pakkumist või kui on tegemist alalisvooluühendusega

pakkumispiirkonna piiriga, kuni koosoptimeerimisega jaotamine on ühtlustatud liidu tasandil

vastavalt artikli 38 lõikele 3.

EBGL artikkel 41 lõige 3 kohaselt tuleb selle meetodi puhul võrrelda sellise piirkonnaülese

võimsuse tegelikku turuväärtust, mida kasutatakse tasakaalustamisvõimsuse vahetamiseks ja

reservide jaotamiseks, ning sellise piirkonnaülese võimsuse prognoositavat turuväärtust, mida

kasutatakse energia vahetamiseks, või tuleb võrrelda sellise piirkonnaülese võimsuse

prognoositavat turuväärtust, mida kasutatakse tasakaalustamisvõimsuse vahetamiseks või

reservide jaotamiseks, ja sellise piirkonnaülese võimsuse tegelikku turuväärtust, mida

kasutatakse energia vahetamiseks.

EBGL artikkel 41 lõige 4 kohaselt hinnakujundusmeetod, kindel jaotuskord ja sellise

võimsusjaotustulu jagamine, mis on saadud piirkonnaülese võimsuse eest, mida jaotatakse

tasakaalustamisvõimsuse vahetamiseks või reservide jaotamiseks turupõhise jaotamise

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protsessi kaudu, peab tagama võrdse kohtlemise võrreldes piirkonnaülese võimsusega, mida

jaotatakse energia vahetamiseks.

EBGL artikkel 41 lõige 5 kohaselt piirkonnaülest võimsust, mida jaotatakse

tasakaalustamisvõimsuse vahetamiseks või reservide jaotamiseks turupõhise jaotamise

protsessi kaudu, võib kasutada üksnes tasakaalustamisenergia vahetamiseks või reservide

jaotamiseks ja seotud tasakaalustamisenergia vahetamiseks.

Euroopa Parlamendi ja nõukogu määrus (EL) 2019/943 artikkel 64 lõike 2a kohaselt võivad

Eesti, Läti ja Leedu reguleerivad asutused lubada oma põhivõrguettevõtjatel jaotada

piirkonnaülest võimsust turupõhises protsessis, nagu on sätestatud EBGL määruse artiklis 41,

mahupiiranguteta kuni kuus kuud pärast päeva, mil koosoptimeerimisega jaotamine saab

täielikult rakendatud ja hakkab toimima vastavalt kõnealuse EBGL määruse artikkel 38 lõikele

3.

Haldusmenetluse seaduse (edaspidi HMS) § 14 lõike 1 kohaselt esitatakse haldusmenetluse

algatamiseks haldusorganile vabas vormis avaldus (edaspidi taotlus).

2. Menetlusosaline

Elering AS, äriregistri kood 11022625, asukoht Kadaka tee 42, Tallinn, 12915, e-post:

[email protected].

3. Asjaolud ja menetluse käik

27.09.2024 esitas Elering AS (edaspidi Elering) Konkurentsiametile taotluse Balti

koordineeritud võimsusarvutuse ala2 põhivõrguettevõtjate (edaspidi ka Põhivõrguettevõtjad)

metoodika, võimsusarvutusala piirkonnaülese võimsuse turupõhiseks jaotamiseks kooskõlas

EBGL artikkel 41 lõikega 1 (edaspidi Metoodika), kooskõlastamiseks.

Balti koordineeritud võimsusarvutuse ala riiklikud reguleerivad asutused on eelnevalt

Metoodika heaks kiitnud 19.09.2023 ning Konkurentsiamet on Metoodika 28.09.2023 otsusega

nr 7-26/2023-002 kooskõlastanud.

Elering selgitab 27.09.2024 esitatud taotluses, et Põhivõrguettevõtjad on juba kooskõlastatud

Metoodika artikkel 8 lõikes 5 tuvastanud algoritmi sihtfunktsiooni definitsioonis matemaatilise

vea, mille tulemusena algoritm võtab vääralt arvesse prognoositud ülekandevõimsuse väärtust

päev-ette turu jaoks. Vastava Metoodika ettepanekuga on eelnimetatud viga korrigeeritud.

Põhivõrguettevõtjad on vastavalt EBGL artiklile 10 Metoodika ettepanekut koos selgitava

dokumendiga avalikult konsulteerinud Euroopa elektri põhivõrguettevõtjate võrgustiku

(ENTSO-E) konsultatsioonikeskkonnas perioodil 13.08.2024 kuni 13.09.2024.3

23.10.2024 toimus Balti riiklike reguleerivate asutuste ja Põhivõrguettevõtjate esindajate vahel

kohtumine, kus Põhivõrguettevõtjate esindaja selgitas Metoodika ettepaneku sisu.

29.11.2024 kiitsid asjaomased riiklikud reguleerivad asutused Balti koordineeritud

võimsusarvutuse ala põhivõrguettevõtjate Metoodika ettepaneku heaks (Lisa 2).

2 Balti koordineeritud võimsusarvutuse alasse kuuluvad Eesti, Läti, Leedu, Poola, Soome ja Rootsi. 3 Kättesaadav: https://consultations.entsoe.eu/markets/proposal-for-amendment-of-methodology-baltic-ccr/

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4. Asjaomaste reguleerivate asutuste ühine seisukoht

Balti piiriülese turupõhise jaotuse ning tasakaalustamisvõimsuse hankimise algoritmis tehakse

optimaalne valik piiriülese võimsuse jaotamiseks tasakaalustamise jaoks, läbi heaolu hindamise

sihtfunktsiooni kaudu. Sihtfunktsioon hindab tasakaalustamisvõimsuse pakkumise kulusid ja

päev-ette energiaturu pakkumise kulusid. Optimeerimisprotsessi käigus minimeeritakse

sihtfunktsiooni numbriline väärtus, et tagada maksimaalne heaolu süsteemis. Viga esineb

sihtfunktsiooni päev-ette turu poolt loodava heaolu prognoosimise hindamises, mistõttu

algoritm alahindab päev-ette turu heaolu ja soosib tasakaalustamisvõimsuse turgu piiriülese

võimsuse jaotamise otsustes.

Balti koordineeritud võimsusarvutuse ala riiklikud reguleerivad asutused teadvustavad, et

Metoodika ettepaneku olemus seisneb Metoodika artikkel 8 lõikes 5 kirjeldatud algoritmi

sihtfunktsiooni muutmises. Põhivõrguettevõtjad on tuvastanud eelnimetatud algoritmis vea,

mille tulemusena algoritm võtab vääralt arvesse prognoositud ülekandevõimsuse väärtust päev-

ette turu jaoks ning esitatud Metoodika ettepanekuga korrigeerivad metoodikat.

Balti koordineeritud võimsusarvutuse ala riiklikud reguleerivad asutused tervitavad esitatud

Metoodika ettepanekut ning vastavalt EBGL artikkel 5 lõikele 6 on omavahel konsulteerinud,

teinud tihedat koostööd ja kooskõlastanud oma tegevust, et jõuda Metoodika ettepaneku

kooskõlastamise osas kokkuleppele. Balti koordineeritud võimsusarvutuse ala riiklikud

reguleerivad asutused on seisukohal, et Metoodika ettepanek ei ole vastuolus EBGL-st ega

Siseturumäärusest tulenevate sätetega ning et seda ettepanekut on võimalik kõikidel

asjaomastel reguleerivatel asutustel siseriiklikult kooskõlastada. Asjaomased reguleerivad

asutused annavad selle kohta välja siseriiklikud otsused.

Kokkuvõte

Konkurentsiamet töötas läbi 27.09.2024 Eleringi poolt ametile kooskõlastamiseks esitatud Balti

koordineeritud võimsusarvutuse ala põhivõrguettevõtjate metoodika võimsusarvutusala

piirkonnaülese võimsuse turupõhiseks jaotamiseks kooskõlas EBGL artikkel 41 lõikega 1 ning

asub seisukohale, et nimetatud Metoodika arvestab kehtivast seadusandlusest tulenevate

alusetega ning ei ole vastuolus EBGL-st ega Siseturumäärusest tuleneva regulatsiooniga.

EBGL artikkel 7 kohaselt tingimuste või meetodite väljatöötamise eest vastutavad

põhivõrguettevõtjad peavad need internetis avaldama pärast asjaomastelt reguleerivatelt

asutustelt saadud heakskiitu või, kui heakskiitu ei ole vaja, siis pärast nende tingimuste või

meetodite väljatöötamist, välja arvatud juhul, kui selline teave on artikli 11 kohaselt

konfidentsiaalne.

Arvestades eeltoodut ja tuginedes ELTS § 93 lõige 6 punktile 6 ja EBGL artikkel 5 lõige 3

punktile h)

otsustan:

kooskõlastada Elering AS poolt Konkurentsiametile esitatud Balti koordineeritud

võimsusarvutuse ala põhivõrguettevõtjate metoodika võimsusarvutusala piirkonnaülese

võimsuse turupõhiseks jaotamiseks, vastavalt Komisjoni määruse (EL) 2017/2195, 23.

november 2017, millega kehtestatakse elektrisüsteemi tasakaalustamise eeskiri, artikkel 41

lõike 1 sisule.

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Käesoleva otsusega mittenõustumise korral on õigus esitada kaebus otsuse tühistamiseks

Tallinna Halduskohtule. Kaebuse halduskohtule võib esitada 30 päeva jooksul arvates

käesoleva otsuse teatavaks tegemisest.

(allkirjastatud digitaalselt)

Evelin Pärn-Lee

peadirektor

Lisad:

1. Methodology for the market-based allocation process of cross-zonal capacity for the

exchange of balancing capacity for the Baltic CCR in accordance with Article 41(1) of

the Commission Regulation (EU) 2017/2195 of 23 November 2017 establishing a

guideline on electricity balancing

2. Position paper of the National Regulatory Authorities of Baltic Capacity Calculation

Region on The Baltic Capacity Calculation Region Transmission System Operators’

proposal for the methodology for the market-based allocation process of cross-zonal

capacity for the exchange of balancing capacity for the Baltic Capacity Calculation

Region in accordance with Article 41(1) of the Commission Regulation (EU) 2017/2195

of 23 November 2017 establishing a guideline on electricity balancing

Position paper of the National Regulatory Authorities

of Baltic Capacity Calculation Region

on

The Baltic Capacity Calculation Region Transmission

System Operators’ proposal for the methodology for

the market-based allocation process of cross-zonal

capacity for the exchange of balancing capacity for the

Baltic Capacity Calculation Region in accordance with

Article 41(1) of the Commission Regulation (EU)

2017/2195 of 23 November 2017 establishing a

guideline on electricity balancing

29 November 2024

2

1. Introduction and legal base

This document elaborates an agreement between the Baltic Capacity Calculation Region (CCR)

National Regulatory Authorities (NRAs)1 of 29 November 2024, on the Baltic CCR Transmission

System Operators’ (TSOs)2 proposal for the methodology for the market-based allocation

process of cross-zonal capacity for the exchange of balancing capacity for the Baltic CCR in

accordance with Article 41(1) of the Commission Regulation (EU) 2017/2195 of 23 November

2017 establishing a guideline on electricity balancing (EBGL)3 (hereinafter Methodology).

This agreement of Baltic CCR NRAs shall provide evidence that a decision on the Methodology

does not, at this stage, need to be adopted by the Agency for Cooperation of Energy Regulators

(Agency) pursuant to paragraph 7 of Article 5 of the EBGL. It is intended to constitute the basis

on which the Baltic CCR NRAs will each subsequently make national decisions pursuant to

paragraph 6 of Article 5 of EBGL to approve Methodology, submitted by TSOs.

The Baltic CCR NRAs must take their decisions to approve proposals regarding Article 5(3)(h)

and Article 41(1) of the EBGL, based on this agreement, by 23 April 2025 at the latest.

The legal provisions relevant to the submission and approval of the Methodology, and this Baltic

CCR NRAs’ agreed opinion of the Methodology, can be found in Articles 3, 5(3)(h), 5(6), 5(7),

6(1), 6(2), 12(3)(j), 38(1)(b), 39, and 41 of the EBGL. Also, in Article 64(2a) of the Regulation (EU)

2019/943 of the European Parliament and of the Council of 5 June 2019 on the internal market

for electricity (IME)4.

Article 3 of the EBGL

1. This Regulation aims at:

(a) fostering effective competition, non-discrimination and transparency in balancing markets;

(b) enhancing efficiency of balancing as well as efficiency of European and national balancing

markets;

(c) integrating balancing markets and promoting the possibilities for exchanges of balancing

services while contributing to operational security;

(d) contributing to the efficient long-term operation and development of the electricity

transmission system and electricity sector in the Union while facilitating the efficient and

consistent functioning of day-ahead, intraday and balancing markets;

(e) ensuring that the procurement of balancing services is fair, objective, transparent and

market-based, avoids undue barriers to entry for new entrants, fosters the liquidity of balancing

markets while preventing undue distortions within the internal market in electricity;

1 Estonian Competition Authority, Public Utilities Commission of Latvia, National Energy Regulatory Council of Lithuania, Energy Authority of Finland, Swedish Energy Markets Inspectorate, Energy Regulatory Office of Poland 2 Elering AS, AS "Augstsprieguma tīkls", Litgrid AB, Fingrid Oyj, Svenska kraftnät, PSE S.A. 3 https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:02017R2195-20220619 4 https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A02019R0943-20240716

3

(f) facilitating the participation of demand response including aggregation facilities and energy

storage while ensuring they compete with other balancing services at a level playing field and,

where necessary, act independently when serving a single demand facility;

(g) facilitating the participation of renewable energy sources and support the achievement of

the European Union target for the penetration of renewable generation.

2. When applying this Regulation, Member States, relevant regulatory authorities, and system

operators shall:

(a) apply the principles of proportionality and non-discrimination;

(b) ensure transparency;

(c) apply the principle of optimisation between the highest overall efficiency and lowest total

costs for all parties involved;

(d) ensure that TSOs make use of market-based mechanisms, as far as possible, in order to

ensure network security and stability;

(e) ensure that the development of the forward, day-ahead and intraday markets is not

compromised;

(f) respect the responsibility assigned to the relevant TSO in order to ensure system security,

including as required by national legislation;

(g) consult with relevant DSOs and take account of potential impacts on their system;

(h) take into consideration agreed European standards and technical specifications.

Article 5(3) (h) of the EBGL

3. The proposals for the following terms and conditions or methodologies and any amendments

thereof shall be subject to approval by all regulatory authorities of the concerned region:

[…]

(h) for each capacity calculation region, the methodology for a market-based allocation process

of cross-zonal capacity pursuant to Article 41(1).

Article 5(6) of the EBGL

6. Where the approval of the terms and conditions or methodologies in accordance with

paragraph 3 of this Article or the amendment in accordance with Article 6 requires a decision by

more than one regulatory authority, the relevant regulatory authorities shall consult and closely

cooperate and coordinate with each other in order to reach an agreement. Where the Agency

issues an opinion, the relevant regulatory authorities shall take that opinion into account.

Regulatory authorities or, where competent, the Agency shall decide on the terms and

conditions or methodologies submitted in accordance with paragraphs 2, 3 and 4, within 6

months following the receipt of the terms and conditions or methodologies by the Agency or the

relevant regulatory authority or, where applicable, by the last regulatory authority concerned.

The period shall begin on the day following that on which the proposal was submitted to the

4

Agency in accordance with paragraph 2, to the last regulatory authority concerned in

accordance with paragraph 3 or, where applicable, to the relevant regulatory authority in

accordance with paragraph 4.

Article 5(7) of the EBGL

7. Where the relevant regulatory authorities have not been able to reach agreement within the

period referred to in paragraph 6, or upon their joint request, or upon the Agency’s request

according to the third subparagraph of Article 5(3) of Regulation (EU) 2019/942, the Agency

shall adopt a decision concerning the submitted proposals for terms and conditions or

methodologies within 6 months from the day of referral, in accordance with Article 5(3) and the

second subparagraph of Article 6(10) of Regulation (EU) 2019/942.

Article 6(1) of the EBGL

1. Where the Agency, all relevant regulatory authorities jointly or the relevant regulatory

authority require an amendment in order to approve the terms and conditions or methodologies

submitted in accordance with Article 5(2), (3) and (4) respectively, the relevant TSOs shall submit

a proposal for amended terms and conditions or methodologies for approval within 2 months

following the request from the Agency or the relevant regulatory authorities. The Agency or the

relevant regulatory authorities shall decide on the amended terms and conditions or

methodologies within 2 months following their submission.

Article 6(2) of the EBGL

2. Where the relevant regulatory authorities have not been able to reach an agreement on terms

and conditions or methodologies within the 2-month deadline, or upon their joint request, or

upon the Agency’s request according to the third subparagraph of Article 5(3) of Regulation (EU)

2019/942, the Agency shall adopt a decision concerning the amended terms and conditions or

methodologies within 6 months, in accordance with Article 5(3) and the second subparagraph

of Article 6(10) of Regulation (EU) 2019/942. If the relevant TSOs fail to submit a proposal for

amended terms and conditions or methodologies, the procedure provided for in Article 4 shall

apply.

Article 12(3) (j) of the EBGL

3. Each TSO shall publish the following information as soon as it becomes available:

[…]

(j) approved methodologies referred to in Articles 40, 41 and 42 at least one month before the

application.

Article 38(1) (b) of the EBGL

1. Two or more TSOs may at their initiative or at the request of their relevant regulatory

authorities in accordance with Article 37 of Directive 2009/72/EC set up a proposal for the

application of one of the following processes:

[…]

5

(b) market-based allocation process pursuant to Article 41.

Article 39 of the EBGL

1. The market value of cross-zonal capacity for the exchange of energy and for the exchange of

balancing capacity or sharing of reserves used in a co-optimised or market-based allocation

process shall be based on the actual or forecasted market values of cross-zonal capacity.

2. The actual market value of cross-zonal capacity for the exchange of energy shall be calculated

based on the bids of market participants in the day-ahead markets, and take into account, where

relevant and possible, expected bids of market participants in the intraday markets.

3. The actual market value of cross-zonal capacity for the exchange of balancing capacity used

in a co-optimised or a market-based allocation process shall be calculated based on balancing

capacity bids submitted to the capacity procurement optimisation function pursuant to Article

33(3).

4. The actual market value of cross-zonal capacity for the sharing of reserves used in a co-

optimised or a market-based allocation process shall be calculated based on the avoided costs

of procuring balancing capacity.

5. The forecasted market value of cross-zonal capacity shall be based on one of the following

alternative principles:

(a) the use of transparent market indicators that disclose the market value of cross-zonal

capacity; or

(b) the use of a forecasting methodology enabling the accurate and reliable assessment of the

market value of cross-zonal capacity.

The forecasted market value of cross-zonal capacity for the exchange of energy between bidding

zones shall be calculated based on the expected differences in market prices of the day-ahead

and, where relevant and possible, intraday markets between bidding zones. When calculating

the forecasted market value, additional relevant factors influencing demand and generation

patterns in the different bidding zones shall be taken duly into account.

6. The efficiency of the forecasting methodology pursuant to paragraph 5(b), including a

comparison of the forecasted and actual market values of the cross-zonal capacity, may be

reviewed by the relevant regulatory authorities. Where the contracting is done not more than

two days in advance of the provision of the balancing capacity, the relevant regulatory

authorities may, following this review, set a limit other than that specified in Article 41(2).

Article 41 of the EBGL

1. By two years after entry into force of this Regulation, all TSOs of a capacity calculation region

may develop a proposal for a methodology for a market-based allocation process of cross-zonal

capacity for the exchange of balancing capacity or sharing of reserves. This methodology shall

apply for the exchange of balancing capacity or sharing of reserves with a contracting period of

not more than one day and where the contracting is done not more than one week in advance

of the provision of the balancing capacity. The methodology shall include:

6

(a) the notification process for the use of the market-based allocation process;

(b) a detailed description of how to determine the actual market value of cross-zonal capacity

for the exchange of balancing capacity or sharing of reserves, and the forecasted market value

of cross-zonal capacity for the exchange of energy, and if applicable the actual market value of

cross-zonal capacity for exchanges of energy and the forecasted market value of cross-zonal

capacity for the exchange of balancing capacity or sharing of reserves;

(c) a detailed description of the pricing method, the firmness regime and the sharing of

congestion income for the cross-zonal capacity that has been allocated to bids for the exchange

of balancing capacity or sharing of reserves via the market-based allocation process;

(d) the process to define the maximum volume of allocated cross-zonal capacity for the

exchange of balancing capacity or sharing of reserves pursuant to paragraph 2.

2. Cross-zonal capacity allocated on a market-based process shall be limited to 10 % of the

available capacity for the exchange of energy of the previous relevant calendar year between

the respective bidding zones or, in case of new interconnectors, 10 % of the total installed

technical capacity of those new interconnectors.

This volume limitation may not apply where the contracting is done not more than two days in

advance of the provision of the balancing capacity or for bidding zone borders connected

through DC interconnectors until the co-optimised allocation process is harmonised at Union

level pursuant to Article 38(3).

3. This methodology shall be based on a comparison of the actual market value of cross-zonal

capacity for the exchange of balancing capacity or sharing of reserves and the forecasted market

value of cross-zonal capacity for the exchange of energy, or on a comparison of the forecasted

market value of cross-zonal capacity for the exchange of balancing capacity or sharing of

reserves, and the actual market value of cross-zonal capacity for the exchange of energy.

4. The pricing method, the firmness regime and the sharing of congestion income for cross-zonal

capacity that has been allocated for the exchange of balancing capacity or sharing of reserves

via the market-based process shall ensure equal treatment with the cross-zonal capacity

allocated for the exchange of energy.

5. Cross-zonal capacity allocated for the exchange of balancing capacity or sharing of reserves

via the market-based allocation process shall be used only for the exchange of balancing

capacity or sharing of reserves and associated exchange of balancing energy.

Article 64(2a) of the IME

1. By way of derogation from Article 6(9), (10) and (11), Estonia, Latvia and Lithuania, may

conclude financial contracts for balancing capacity up to five years before the start of the

provision of the balancing capacity. The duration of such contracts shall not extend beyond eight

years after Estonia, Latvia and Lithuania have joined the Continental Europe Synchronous Area.

The regulatory authorities of Estonia, Latvia and Lithuania may allow their transmission system

operators to allocate cross-zonal capacity on a market-based process as set out in Article 41 of

7

Regulation (EU) 2017/2195, without volume limitations until six months after the day on which

the co-optimised allocation process is fully implemented and operational pursuant to Article

38(3) of that Regulation.

2. The Methodology proposal

The Methodology proposal was consulted by the Baltic CCR TSOs through ENTSO-E consultation

hub for one month from 13 August 2024 to 13 September 2024 in accordance with Article 10

of the EBGL. 5

Baltic CCR Steering Committee sent the methodology to the Baltic CCR NRAs on 24 September

2024. The Baltic CCR TSOs’ Methodology proposal, having been submitted by the respective

TSO, was received by the last Baltic CCR NRA on 22 October 2024. Therefore, in accordance with

Article 5(6) of the EBGL, the deadline for approval for the Baltic CCR NRAs is 23 April 2025.

The Baltic CCR NRAs, in accordance with Article 5(6) of the EBGL, have assessed, consulted and

closely cooperated and coordinated with each other in order to reach an agreement on the

Methodology proposal.

3. The CCR Baltic NRAs’ position

The Baltic CCR NRAs acknowledge that the nature of the Methodology proposal is to amend the

mathematical formulation of the objective function in Article 8(5) of the Methodology. The

Baltic CCR TSOs have identified a mathematical mistake (error) in the Methodology currently in

force which causes the algorithm to falsely estimate the value of cross-zonal capacity for the

day-ahead market.

In the Baltic market-based cross-zonal capacity allocation and balancing capacity procurement

algorithm, the optimal choice for allocating cross-zonal capacity for balancing is made by

welfare evaluation in the objective function. The objective function evaluates the provision cost

of balancing capacity (social cost of accepted bids) and the cost of provision of day-ahead

energy. The numerical value of the objective function during optimization process is minimized,

granting maximum welfare in a system with inelastic demands. The error exists in the

assessment of forecast day-ahead welfare in the objective function and causes the algorithm to

underestimate the welfare of the day-ahead market and favors the balancing capacity market

when taking decisions on the allocating of cross-zonal capacity for balancing products.

Accordingly, the Baltic CCR TSOs have created the methodology amendment proposal to

implement the correct formulation of the objective function in the methodology proposal.

After assessing the Methodology proposal, the Baltic CCR NRAs have concluded that the

amendments proposed in the Methodology proposal are justified in aiming to improve the

algorithm’s performance to accurately forecast the value of cross-zonal capacity for the day-

ahead market and to provide the optimal choice for allocating cross-zonal capacity for

balancing. The Methodology proposal thus encompasses all necessary arrangements pursuant

5 https://consultations.entsoe.eu/markets/proposal-for-amendment-of-methodology-baltic-ccr/

8

to Article 41(1) of the EBGL and takes into account the derogation pursuant to Article 64(2a) of

the IME.

4. Conclusion

The Baltic CCR NRAs have assessed, consulted and closely cooperated and coordinated to reach

an agreement on the Methodology proposal to conclude that the Methodology proposal meets

the requirements of the EBGL and as such can be approved by the Baltic CCR NRAs. Thereby,

the Baltic CCR NRAs must take their decisions to approve proposals regarding Article 5(3)(h) and

Article 41(1) of the EBGL, based on this agreement, by 23 April 2025 at the latest.

However, the Baltic CCR NRAs acknowledge the importance of the Baltic power system’s

desynchronization from the Russian/Belarussian grid on 8 February 2025, and in order to ensure

sufficient balancing capacity for the desynchronization period, the Baltic balancing capacity

market shall start on the 7 February at the absolute latest. Considering the aforementioned

timeline and the information disclosure requirement pursuant to Article 12(3)(j) of the EBGL,

the Baltic CCR NRAs are making efforts to issue national decisions regarding the Methodology

in due time before the desynchronization.

Methodology for the market-based allocation

process of cross-zonal capacity for the

exchange of balancing capacity for the Baltic

CCR in accordance with Article 41(1) of the Commission Regulation (EU)

2017/2195 of 23 November 2017 establishing a guideline on electricity balancing

16 July 2024

Page 2 of 17

Whereas

(1) This document provides a methodology for a market-based allocation process of cross-zonal capacity

for the exchange of balancing capacity and sharing of reserves (hereafter referred to as “this

methodology”) in accordance with article 41(1) of Commission Regulation (EU) 2017/2195 of 23

November establishing a guideline on electricity balancing (hereafter referred to as the “EB

Regulation”) for the geographic area covering the Baltic capacity calculation region (hereinafter

referred to as the “Baltic CCR”) as defined in accordance with Article 15 of Commission Regulation

(EU) 2015/1222 of 24 July 2015 establishing a guideline on capacity allocation and congestion

management (hereafter referred to as the “CACM Regulation").

(2) This methodology takes into account the general principles and goals set out in the EB Regulation as

well as Commission Regulation (EU) 2017/1485 of 2 August 2017 establishing a guideline on

electricity transmission system operation (hereafter referred to as the “SO Regulation”), the CACM

Regulation and Regulation (EU) 2019/943 of the European Parliament and of the Council of 5 June

2019 on the internal market for electricity (hereafter referred to as the “Electricity Regulation”).

(3) The Transmission System Operators of the Baltic CCR (hereafter referred to as the “TSOs”) intend

to exchange balancing capacity and plan for that reason to develop common and harmonised rules

and processes for this exchange and procurement in accordance with Article 33 of the EB Regulation.

To secure this exchange of balancing capacity, the TSOs intend to submit an application proposal in

accordance with Article 38(1) of the EB Regulation to allocate cross-zonal capacity across

timeframes using the market-based allocation process pursuant to Article 41 of the EB Regulation.

This methodology shall define the details of a market-based cross-zonal capacity allocation process.

(4) This methodology is based on an optimisation process that seeks to maximise the sum of actual

economic surplus from the procurement of balancing capacity and sharing of reserves and the

forecasted estimation of economic surplus for the single day-ahead coupling. Consistent with the EB

Regulation's aims as stated in its Article 3, this optimisation process enhances the efficiency of

balancing and of European and national balancing markets. The pricing method, the firmness regime

and the sharing of congestion income for cross-zonal capacity that has been allocated for the exchange

of balancing capacity ensures equal treatment with cross-zonal capacity allocated for the exchange of

energy.

(5) The optimisation process used to allocate cross-zonal capacity effectively trades off the use of cross-

zonal capacity for the exchange of balancing capacity and sharing of reserves with the use of cross-

zonal capacity for the exchange of energy in the day-ahead market. The forecasted market value of

cross-zonal capacity for the exchange of energy that is used in this process is calculated based on the

latest available day-ahead energy prices in the connecting bidding zones. The value of cross-zonal

capacity for the exchange of balancing capacity is calculated within the optimisation process itself

and formed by the actual balancing capacity bids submitted by the balancing service providers

(“BSPs”). The TSOs will, as part of this allocation processes’ implementation, collect information on

and review the accuracy and efficiency of the forecasting methodology used. This review will include

a comparison of the forecasted and actual market values of cross-zonal capacity for the exchange of

energy.

(6) This methodology generally contributes to the achievement of the objectives of Article 3 of the EB

Regulation. In particular, this methodology serves the following objectives:

Page 3 of 17

(a) This methodology enables the allocation of cross-zonal capacity for the exchange of balancing

capacity to a region with common and harmonised rules and processes for the exchange and

procurement of balancing capacity developed in accordance with Article 33 of the EB

Regulation, and therefore facilitates the coupling of local balancing capacity markets. By

doing so, this methodology contributes to an efficient utilisation of balancing capacity

resources across bidding zone borders in order to secure the volume of balancing capacity

needed to maintain operational security. The market-based cross-zonal capacity allocation

process is using submitted bids from BSPs and a transparent forecasting method for

estimating the value of cross-zonal capacity for the single day-ahead coupling to allocate

cross-zonal capacity for balancing capacity procurement in the respective region. Hence, this

methodology fosters effective competition in a non-discriminatory and transparent way in

balancing markets (Article 3(1)(a) of the EB Regulation), enhances the efficiency of

balancing as well as the efficiency of European and national balancing markets (Article

3(1)(b) of the EB Regulation) and contributes to the objective of integrating balancing markets

and promoting the possibilities for exchanges of balancing services while contributing to

operational security (Article 3(1)(c) of the EB Regulation).

(b) This methodology takes into account the impact on the day-ahead market by using the

forecasted market value of cross-zonal capacity in the day- ahead market for the objective to

maximise the total economic surplus of both the day-ahead energy and balancing capacity

markets. By allowing the exchange of balancing capacity, leading to a more efficient

balancing capacity market and price formation, it also contributes to efficient investment

signals in new capability for providing balancing capacity. Therefore, this methodology

contributes to the efficient long-term operation and development of the electricity

transmission system and electricity sector in the Union while facilitating the efficient and

consistent functioning of the day-ahead, intraday and balancing markets (Article 3(1)(d) of

the EB Regulation).

(c) This methodology ensures that the procurement of balancing services is fair, objective,

transparent and market-based, avoids undue barriers to entry for new entrants, fosters the

liquidity of balancing markets while preventing undue distortions within the internal market

in electricity (Article 3(1)(e) of the EB Regulation), since it will foster liquidity for the

procurement of balancing capacity in integrated balancing capacity markets while taking into

account the impacts on the day-ahead market. The allocation of cross-zonal capacities by the

market-based capacity allocation process provides a transparent input for the procurement of

balancing capacity in an objective way and is based on market inputs from the balancing

capacity and day-ahead energy markets.

(d) This methodology does not negatively impact the objectives in accordance with Articles

3(1)(f) and (g) of the EB Regulation.

Page 4 of 17

TITLE 1

General provisions

Article 1 Subject matter and scope

1. This document is the methodology for the market-based allocation process of cross-zonal capacity for the

exchange of balancing capacity and sharing of reserves in accordance with Article 41(1) of the EB

Regulation for the Baltic CCR. It is based on the comparison of the forecasted market value of cross-

zonal capacity for the exchange of energy and the actual market value of cross-zonal capacity for the

exchange of balancing capacity and sharing of reserves in accordance with Article 39 of the EB Regulation.

2. This methodology also includes the algorithm principles for the cross-zonal capacity allocation function.

3. This methodology covers the bidding zone borders of the Baltic CCR.

4. The application of this methodology shall be subject to the methodology pursuant to Article 38(1)(b) of

the EB Regulation, which shall define the bidding zone borders, the market timeframe and the duration

of application in accordance with Article 38(2)(a) of the EB Regulation.

5. Two or more TSOs willing to exchange balancing capacity and/or willing to perform sharing of reserves

by applying the market-based capacity allocation shall use a common and harmonised set of rules and

processes for the exchange and procurement of balancing capacity in accordance with Article 33(1) of

the EB Regulation, and respecting the requirements set out in Article 32 of the EB Regulation.

6. A TSO applying a central dispatching model and the market-based cross-zonal allocation process shall

convert as far as possible the integrated scheduling process bids into standard balancing capacity product

bids, pursuant to Article 27(3) of the EB Regulation. In this case, each reference to the standard balancing

capacity bids in this methodology, shall be understood for this TSO as a reference to the integrated

scheduling process bids converted into standard balancing capacity bids.

Article 2

Definitions and interpretation

1. For the purposes of this methodology , terms used in this methodology shall have the meaning of the

definitions included in Article 2 of the EB Regulation, Article 3 of the SO Regulation and Article 2 of

the CACM Regulation, Article 2 of the Commission Regulation (EU) 2016/1719 of 26 September

establishing a guideline on forward capacity allocation (hereafter referred to as the “FCA Regulation”),

Article 2 of the Electricity Regulation, Article 2 of the Commission Regulation (EU) No 543/2013 of 14

June 2013 on submission and publication of data in electricity markets and amending Annex I to

Regulation (EC) No 714/2009 of the European Parliament and of the Council (hereafter referred to as

"Transparency Regulation") and Directive (EU) 2019/944.

2. The following additional definitions shall also apply:

Page 5 of 17

(a) ‘cross-zonal capacity allocation function’ means the functionality that optimises the allocation

of cross-zonal capacity across the day-ahead market timeframe and the market timeframe for the

exchange of balancing capacity and sharing of reserves;

(b) ‘economic surplus from the exchange of balancing capacity and sharing of reserves’ means the

sum for the relevant time period of (i) the TSOs’ surplus for the exchange of balancing capacity

and sharing of reserves, (ii) the BSPs’ surplus for the exchange of balancing capacity and sharing

of reserves and (iii) the congestion income. The surplus for BSPs is the difference between the

balancing capacity price and the prices of the accepted balancing capacity bids multiplied by the

accepted volume of the balancing capacity bids. The surplus for TSOs is the difference between

the technical price limit and the balancing capacity price multiplied by the volume of the TSO

demand;

(c) ’mark-up’ is a positive numerical value with units of EUR/MWh which means an addition per

day ahead market time unit to the forecasted market value of cross-zonal capacity for the

exchange of energy, calculated in order to take into account the uncertainty in the forecasted

market value of cross-zonal capacity for the exchange of energy during the allocation of the cross-

zonal capacity for the exchange of balancing capacity and sharing of reserves;

(d) ‘positive forecast error’ is a positive numerical value with units of EUR/MWh which means an

underestimation per day ahead market time unit of the initial forecasted market value of cross-

zonal capacity for the exchange of energy;

(e) ’reference day’ means the day which is used to define the forecasted market value of cross-zonal

capacity for the exchange of energy;

(f) ‘TSO demand’ means the balancing capacity volume to be procured within the scope of the

methodology pursuant to Article 33(1) of the EB Regulation by the connecting TSO and defined

per scheduling area and bidding zone in accordance with Article 32(1) of the EB Regulation;

(g) ‘Demand reduction resources’ - resources provided by the Baltic TSOs or other service providers

for the reduction of the demand, to be procured from primary and back-up resources, according

to EBGL Article 32(1);

(h) ‘Primary resources’ – resources provided by the BSPs for the balancing capacity market auctions;

(i) ‘Back-up resources’ - additional resources provided for balancing market auctions in case of

unsatisfactory balancing capacity market optimization results;

(j) ‘The Baltic countries’ – the joint geographical area of Estonia, Latvia and Lithuania.

3. In this methodology, unless the context requires otherwise:

(a) the singular also includes the plural and vice versa;

(b) the table of contents and headings are inserted for convenience only and do not affect the

interpretation of this methodology;

(c) any reference to cross-zonal capacities shall include also the reference to allocation constraints

as applied in the respective capacity calculation methodology pursuant to Article 20 of the

CACM Regulation;

(d) any reference to legislation, regulation, directive, order, instrument, code or any other enactment

shall include any modification, extension or re-enactment of it then in force; and

(e) any reference to an Article without an indication of the document shall mean a reference to this

methodology.

Page 6 of 17

TITLE 2

Market-based allocation process of cross-zonal capacity for the exchange of balancing capacity and sharing of reserves

Article 3 Principles for applying market-based cross-zonal capacity allocation process

1. The market-based capacity allocation process shall be executed by the cross-zonal capacity allocation

function and shall determine the amount of cross-zonal capacities to be allocated to the exchange of

standard balancing capacity products or sharing of reserves for each day ahead market time unit following

the objective in Article 8(4).

2. TSOs shall use standard balancing capacity products for frequency restoration reserves and replacement

reserves pursuant to Article 25(2) of the EB Regulation and submit all balancing capacity bids from

standard balancing capacity products to the capacity procurement optimisation function pursuant to

Article 33(3) of the EB Regulation. TSOs shall not modify or withhold any balancing capacity bids and

shall include them in the procurement process, except under conditions set out in Article 26 and Article

27 of the EB Regulation.

3. A single gate closure time shall apply for all balancing capacity markets where this methodology is

applied irrespective of time zone differences, such that one gate closure time shall be applied for the

submission of all standard balancing capacity bids. This gate closure time shall be set D-1 after the pre-

final capacity calculation and before the final day-ahead capacity calculation. For TSOs applying a central

dispatching model and applying this methodology, the gate closure time for the submission of the

integrated scheduling process bids that are converted to the standard balancing capacity bids shall be

defined in the national terms and conditions pursuant to Articles 24(5) and 24(6) of the EB Regulation.

4. For each application of this methodology, the validity period of standard balancing capacity bids shall be

equal or a multiple of the day-ahead market time unit and shall be less or equal to the total amount of day-

ahead market time unit of the concerned day.

5. The pricing principle used for the settlement of standard balancing capacity bids between TSOs and BSPs

for each application of this methodology shall be based on cross-zonal marginal pricing (pay-as-cleared).

6. The cross-zonal capacity allocation function shall allow linking of bids which participate in the market-

based cross-zonal capacity allocation process, in accordance with the defined linking provisions pursuant

to the methodology pursuant to Article 33(1) of the EB Regulation. Besides the exemption pursuant to

Article 7(4)(b), such links shall only be allowed within the market-based allocation process.

7. All TSOs applying this market-based process shall ensure compatibility between the cross-zonal capacity

allocation function and the capacity procurement optimisation function, including the selection of

standard balancing capacity bids which determine the output of the cross-zonal capacity allocation

function in accordance with Article 8(5).

8. According to Article 38(4) of the EB Regulation, cross-zonal capacities allocated to the exchange of

standard balancing capacity products or sharing of reserves where this market-based allocation process

is applied, shall be:

Page 7 of 17

(a) exclusively provided to the cross-border FRR control processes in accordance with Article 149

of the SO Regulation until all TSOs of a bidding zone border are connected to the respective

platform pursuant to Articles 20 and 21 of the EB Regulation;

(b) exclusively provided to the respective platform, pursuant to Articles 19 to 21 of the EB

Regulation, of the standard balancing capacity product it was allocated for, starting from the

connection of the TSOs from the concerned bidding zone border to the respective platform.

9. The process of releasing allocated cross-zonal capacity for the exchange of balancing capacity and sharing

of reserves, pursuant to Article 38(9) of the EB Regulation, shall be:

(a) coordinated by the cross-border control process in accordance with Article 149 of the SO

Regulation until the connection of the TSOs to the platforms pursuant to Article 19 to 21 of the

EB Regulation;

(b) coordinated between the platforms for balancing energy pursuant to Articles 19 to 21 of the EB

Regulation, starting from the connection of the TSOs to these platforms.

Article 4

Notification process for the use of the market-based allocation process

1. Each TSO intending to apply this market-based allocation process shall notify all TSOs of the same

synchronous area(s) 3 (three) months prior to entering into operation in accordance with Article 150 of

the SO Regulation and inform all stakeholders and all TSOs through an announcement on the ENTSO-E

website, at least 3 (three) months prior to entering into operation. This announcement on the ENTSO-E

website shall include:

(a) the TSOs involved;

(b) the expected date for the exchange of balancing capacity and sharing of reserves pursuant to

Article 33(1) of the EB Regulation with the market-based allocation process to enter into

operation;

(c) the detailed description of the specifications, including the market timeframe, in accordance with

article 38(2) of the EB Regulation;

(d) the forecast of the average expected amount of frequency restoration power interchange due to

the cross-zonal FRR activation process or reserve replacement power interchange due to the

cross-zonal RR activation process;

(e) the maximum limit(s) of cross-zonal capacity for exchange of balancing capacity as defined

pursuant to Article 5(1) and maximum amount of exchange or sharing of reserves pursuant to

Article 5(3); and

(f) the type and direction of standard balancing capacity product which will be exchanged or shared.

2. All TSOs applying this methodology, shall share the algorithm applying the cross-zonal capacity

allocation function with all Baltic CCR TSOs, of a cooperation applying the market-based process in

accordance with Article 38(1) of the EB Regulation.

Page 8 of 17

3. The TSOs intending to apply this methodology shall publish 3 (three) months ahead of the application of

this methodology on the ENTSO-E website the expected costs and benefits of such an application of this

methodology.

Article 5

Process to define the maximum volume of allocated cross-zonal capacity for the exchange of balancing capacity and sharing of reserves

1. In accordance with Article 41(1)(d) of the EB Regulation, the process to define the maximum volume of

allocated cross-zonal capacity for the exchange of balancing capacity and sharing of reserves for the cross-

zonal capacity allocation function shall be as follows:

(a) by default the maximum volume of cross-zonal capacity allocated for the exchange of balancing

capacity and sharing of reserves shall be calculated as a percentage value of cross-zonal capacity

calculated for the day-ahead timeframe in accordance with the capacity calculation

methodologies developed pursuant to Article 20(2) of the CACM Regulation and the value shall

be the following:

i. 50% for the borders between any two bidding zones which are inside the Baltic

countries;

ii. 10% for all other bidding zone borders in the Baltic CCR;

(b) to resolve a situation where the limit for the maximum volume of cross-zonal capacity allocated

for the exchange of balancing capacity in accordance with paragraph 1(a) is not sufficient to

satisfy TSO demand in a bidding zone, a TSO may increase the percentage limit pursuant to

paragraph 1(a) on the relevant bidding zone borders or critical network elements for the relevant

day-ahead market time units. The limit for the maximum volume of cross-zonal capacity

allocated for the exchange of balancing capacity shall only be increased to the point until the

TSO demand is satisfied and the higher percentage value defined in this paragraph of the

calculated cross-zonal capacity calculated for day ahead market timeframe. If this maximum limit

is still not sufficient to satisfy a TSO demand, a fall-back procedure pursuant to Article 7(6) shall

be initiated. TSOs shall notify the regulatory authorities of the Baltic CCR about each increase

of the limit for the maximum volume of cross-zonal capacity allocated for the exchange of

balancing capacity above the threshold set in paragraph 1(a). This notification shall include at least

the final volume percentage and value in MW of cross-zonal capacity allocated for the exchange

of balancing capacity and the reasons for the shortage of balancing capacity bids in the importing

bidding zone, including the list of all available bids in the algorithm, per each bidding zone. The

notification shall take place no later than two weeks after such increase. The annual impact of

such increases shall be reported pursuant to Article 12(8)(b). The higher percentage value shall

be the following:

i. 70% for the borders between any two bidding zones which are inside the Baltic

countries;

ii. 20% for all other bidding zone borders in the Baltic CCR;

(c) if increases pursuant to paragraph (1)(b) occur due to a structural local shortage of BSPs’ bids

for a standard balancing capacity product in a bidding zone, in the case when over a two-week

period it is observed that for at least 25% of market time units the process set in paragraph (1)(a)

is executed, the limit for the maximum volume of cross-zonal capacity allocated for the exchange

of balancing capacity and sharing of reserves in accordance with paragraph (1)(a) may be

increased by 2 percentage points on the bidding zone borders which require an increase of this

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limit. Such increase of the default limit shall be reported to stakeholders and the regulatory

authorities of the Baltic CCR at least two weeks in advance of application. This process can be

performed repeatedly up until the increased percentage value of the calculated cross-zonal

capacity calculated for day ahead market timeframe set in this paragraph is reached. The applied

default limits shall be published in accordance with Article 12(7). Following the increase of the

default limit, if the structural local shortage of BSPs’ bids is remedied, in the case when over a

two-week period it is observed that during no hours the maximum threshold set by the process in

this paragraph is reached, the increased limit shall be reduced by 2 percentage points on the

bidding zone borders which no longer require the increase on the limit. Such decrease of the

default limit shall be reported to stakeholders and the regulatory authorities of the Baltic CCR at

least two weeks in advance of application. This process can be performed repeatedly in the cross-

zonal capacity allocation function down to the default limit of 50% of the calculated cross-zonal

capacity calculated for day ahead market timeframe, provided that TSO demand is still satisfied.

The applied default limits shall be published in accordance with Article 12(7). The increased

percentage value that can be reached by the process set in this paragraph is as follows:

i. 70% for the borders between any two bidding zones which are inside the Baltic

countries;

ii. 20% for all other bidding zone borders in the Baltic CCR;

2. The exchange of balancing capacity and sharing of reserves shall, in addition to the limit defined in

accordance with paragraph 1, be limited by the rules for the exchange and sharing of reserves in

accordance with Title 8, Chapter 1 and 2 of the SO Regulation through the:

(a) maximum procurement volume of balancing capacity per direction for a specific bidding zone,

or a set of bidding zones due to operational security requirements pursuant to Article 165(3)(g)

of the SO Regulation;

(b) minimum procurement volume of balancing capacity per direction for a specific bidding zone,

or a set of bidding zones defined in accordance with the dimensioning process pursuant to Article

157(2)(g) of the SO Regulation.

Article 6

Determination of the forecasted market value of cross-zonal capacity for the exchange of energy in single day-ahead coupling

1. The initial forecasted market value of cross-zonal capacity for the exchange of energy defined for each

direction, for each bidding zone border and for each day-ahead market time unit shall be:

(a) equal to the positive market spread for each day-ahead market time unit of the reference day for

the direction of the positive market spread; or

(b) equal to zero for each day-ahead market time unit of the reference day for the direction of the

negative market spread or in case of zero market spread.

2. The initial forecasted market value of cross-zonal capacity for the exchange of energy will be adjusted

when the available cross-zonal capacity available for the exchange of energy is changed and the cross-

zonal capacity is congested before the adjustment, after the adjustment or both. The adjustment in the

market value of cross-zonal capacity for the exchange of energy is based on the expected changes in

bidding zones’ dispatch and the corresponding changes in bidding zone’s clearing prices. The adjustment

to the clearing prices in bidding zones shall be dependent on the forecast change of the net position of the

bidding zone in a linear manner.

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1, = 0, + × ∆

Where:

– DAM price volume sensitivity of bidding zone a [€/MWh2];

0, – the forecast DAM price from the reference day methodology in bidding zone a [€/MWh];

1, – the anticipated DAM price after the shift in net position in bidding zone a [€/MWh];

∆ – change of net position from the forecast value for bidding zone a [MWh].

3. A mark-up shall be added to the initial forecasted market value of cross-zonal capacity calculated in

accordance with paragraph 1, in order to take into account the uncertainty of the forecasted market value

of cross-zonal capacity. This mark-up is defined for each direction as follows:

(a) if there is a negative or zero market spread for the initial forecasted market value of cross-zonal

capacity in accordance with paragraph 1, the mark-up will be 0.1 EUR/MWh; and

(b) if there is a positive market spread, for the initial forecasted market value of cross-zonal capacity

in accordance with paragraph 1, the mark-up will be 1 EUR/MWh.

4. If the average positive forecast error over the last 30 days, per bidding zone border and per direction,

excluding the 5% hours with the highest positive forecast errors, is 1 EUR/MWh higher or lower than the

mark-up applied the day before, the TSOs of this bidding zone border shall respectively increase or

decrease the mark-up pursuant to paragraph 3(b) with 1 EUR/MWh for the respective direction. The

mark-up for a positive market spread, can never be lower than the default value pursuant to paragraph

3(b) and never higher than 5 EUR/MWh. The updated mark-ups shall be published pursuant to Article

12(2).

5. The forecasted market value for the exchange of energy or sharing of reserves per product, per day ahead

market time unit, for each direction and per bidding zone border shall be equal to the sum of the initial

forecasted market value pursuant to paragraph 1, the adjustments deriving from paragraph 2 and the mark-

up pursuant to paragraphs 3 and 4.

6. The reference day shall be:

(a) the previous working day whenever cross-zonal capacity is allocated for a working day;

(b) the previous weekend day or bank holiday whenever cross-zonal capacity is allocated for a

weekend day; and

(c) the previous Sunday or bank holiday whenever cross-zonal capacity is allocated for a bank

holiday in any of the relevant bidding zones.

7. The TSOs shall monitor the efficiency of the forecasting methodology pursuant to Article 12(8).

Article 7

Determination of the market value of cross-zonal capacity for the exchange of balancing capacity and sharing of reserves

1. The actual market value of cross-zonal capacity for the exchange of balancing capacity and sharing of

reserves between all bidding zones where this methodology is applied shall be:

(a) equal to the change of economic surplus from the exchange of balancing capacity and sharing of

reserves per MW of cross-zonal capacity allocated;

(b) defined per day-ahead market time unit;

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(c) calculated per standard balancing capacity product, separately;

(d) calculated based on the standard upward balancing capacity bids or standard downward

balancing capacity bids submitted to the capacity procurement optimisation function pursuant to

Article 33(3) of the EB Regulation; and

(e) calculated based on TSO demand.

2. The actual market value of cross-zonal capacity for the exchange of balancing capacity and sharing of

reserves between bidding zones, where this methodology is applied, shall be calculated based on the

change of economic surplus due to the exchange of balancing capacity and sharing of reserves, resulting

from the change of available cross-zonal capacities allocated to the market timeframe for the exchange of

balancing capacity and sharing of reserves.

3. The TSOs shall not put a price on the TSO demand used in the market-based allocation process.

4. TSOs may increase the TSO demand of a certain standard balancing capacity product to:

(a) select an indivisible bid if such an increase would decrease the overall procurement costs for the

respective standard balancing capacity product; or

(b) substitute an lower quality standard balancing capacity product if such substitution is based on

firm bid(s) from BSPs during the time of the market-based process and would decrease the

combined overall procurement costs for both standard balancing capacity product or in case of

volume shortage of the lower quality standard balancing capacity product and if there is no

possibility for a similar lower quality standard balancing capacity product to participate directly

in the market-based process.

5. TSOs may decrease the TSO demand of a certain standard balancing capacity product in case of sharing

of reserves.

6. If the demand for a standard balancing capacity product of TSOs in a region where market-based cross-

zonal capacity allocation is applied, exceeds the available amount of bids for the relevant standard

balancing capacity product, while taking into account the maximum volume of allocated cross-zonal

capacity for the exchange of balancing capacity and sharing of reserves in accordance with Article 5, a

additional iterations of the cross-zonal capacity allocation function shall be commenced. Such procedures

shall be described in the methodology pursuant to Article 33(1) and 38(1) of the EB Regulation.

7. If the cross-zonal capacity allocation function cannot provide results due to any technical issues and

unexpected circumstances, fallback conditions shall be in effect. Such procedures shall be described in

the methodology pursuant to Article 33(1) and Article 38(1) of the EB Regulation.

8. If a TSO demand for a standard balancing capacity product per bidding zone exceeds the available amount

of locally submitted BSP bids in the bidding zone for the respective standard balancing capacity product

but the maximum volume of allocated capacity is enough to cover the deficit, the market-based capacity

allocation shall be performed. To calculate the change of economic surplus from the exchange of

balancing capacity and sharing of reserves in such a case, the difference between the technical price limit

and the marginal price of the importing BSP bids shall be considered as the change of economic surplus

of the TSO of the bidding zone with insufficient bids. In case of insufficient local bids to meet the local

TSO demand and a simulations scarcity situation in SDAC, the maximum between technical price limit

applied in SDAC and the highest local BSP’s bid price shall be used as the technical price limit for the

market-based cross-zonal capacity allocation.

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Article 8

Determination of the allocated volume of cross-zonal capacity for the exchange of balancing capacity and sharing of reserves

1. The cross-zonal capacity allocation function shall determine the allocated volume of cross-zonal capacity

for the exchange of balancing capacity and sharing of reserves considering the selection of balancing

capacity bids via the capacity procurement optimisation function.

2. The inputs to the algorithm for the cross-zonal capacity allocation function are:

(a) the forecasted day-ahead market prices of each of the bidding zones included in the forecast

process;

(b) the price-volume sensitivity parameter of each of the bidding zones included in the forecast

process which depicts the estimated increase or decrease in systems costs per bidding zone if

forecasted level of dispatch in a certain bidding zone is increased or decreased;

(c) the forecasted net positions of each of the bidding zones included in the forecast process;

(d) the list of balancing capacity bids from balancing service providers for each bidding zone, day-

ahead market time unit and standard balancing capacity product sorted in order of their bid prices;

(e) the volume of capacity provided by demand reduction resources used to reduce the amount of

balancing capacity to be procured from primary and back-up resources to cover the TSO demand;

(f) the volume of available capacity provided by back-up resources used to satisfy TSO demand in

case primary and demand reduction resources, and increase of cross-zonal capacity limits does

not fully cover TSO demands;

(g) the TSO demand for each bidding zone, day-ahead market time unit and standard balancing

capacity product; and

3. The constraints to the algorithm for the cross-zonal capacity allocation function are:

(a) the volume of cross-zonal capacity that can be allocated for the exchange of energy and for the

exchange of balancing capacity and sharing of reserves, combined;

(b) the maximum volume of allocated cross-zonal capacity for the exchange of balancing capacity

and sharing of reserves defined pursuant to Article 5(1);

(c) the minimum and maximum procurement volume of balancing capacity defined pursuant to

Article 5(3); and

(d) the tolerance band for the reduced/increased TSO demand as a function of the available cross-

zonal capacities, based on:

i. sharing of reserves agreement of two or more TSOs to be applied with market-based

allocation pursuant to Article 7(5);

ii. substitution of reserves for volume shortage by another standard balancing capacity

product pursuant to Article 7(4)(b);

iii. substitution of reserves for cost minimisation by another standard balancing capacity

product pursuant to Article 7(4)(b).

4. The objective of the cross-zonal capacity allocation function shall be the maximisation, per trading day,

of the sum of

(a) the expected economic surplus for SDAC, based on the forecasted market value for the exchange

of energy pursuant to Article 6(5), and

(b) the economic surplus from the exchange of balancing capacity and sharing of reserves based on

the actual market value for the exchange of balancing capacity pursuant to Article 7(2).

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5. The mathematical formulation of the objective function is as follows:

= ∑ ( × × ) + ∑ [∆ × 0, + × ∆ 2 ×

1

2 ]

Where: - the cost of balancing capacity bid i [(€/MW)/h)];

- the volume of balancing capacity bid i [MW];

- the boolean determining whether balancing capacity bid i is accepted or not;

∆ - the deviation of the forecast net position of bidding zone a [MWh];

0, - the forecasted reference day day-ahead market price in bidding zone a [€/MWh];

- the price/volume sensitivity of day-ahead bidding zone a [€/MWh2].

6. The output from the algorithm for the cross-zonal capacity allocation function, per standard balancing

capacity product and for each day-ahead market time unit is the available cross-zonal capacity allocated

to the exchange of balancing capacity and sharing of reserves.

7. Each marginal volume of cross-zonal capacity shall be allocated to the exchange of energy in case the

actual market value of cross-zonal capacity for the exchange of balancing capacity and sharing of reserves

pursuant to Article 7(2) is lower or equal to the forecasted market value of cross-zonal capacity for the

exchange of energy pursuant to Article 6(5).

8. Netting of cross-zonal capacity allocated to the exchange of balancing capacity and sharing of reserves

is not possible between:

(a) standard upward and downward balancing capacity bids;

(b) standard balancing capacity bids from different standard balancing capacity products.

9. In case where cross-zonal capacity allocated to the exchange of balancing capacity and sharing of reserves

would be allocated such that cross-zonal capacity for upward and downward balancing capacity would be

allocated in the same cross-zonal capacity direction, cross-zonal capacity allocated for upward balancing

capacity products can be used by downward balancing capacity products; and vice versa.

Article 9

Firmness regime for the allocation of cross-zonal capacity

1. The cross-zonal capacity allocated for the exchange of balancing capacity and sharing of reserves shall

be firm after the optimisation by the cross-zonal capacity allocation function. 2. In the event of force majeure or emergency situations, curtailment of cross-zonal capacities which were

allocated using the cross-zonal capacity allocation function shall be proportionally distributed between

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the affected cross-zonal capacity allocated for the exchange of energy and for the exchange of balancing capacity and sharing of reserves in accordance with Article 41(4) of the EB Regulation. TSOs can deviate from this principle by proposing a more cost efficient, non-discriminatory solution in the proposal

pursuant to Article 33(1) of the EB Regulation.

3. Costs of ensuring firmness of cross-zonal capacity allocated for the exchange of balancing capacity and

sharing of reserves shall include follow up costs of ensuring firmness of procured standard balancing

capacity bids in accordance with paragraph 1, which are caused by the curtailment of firm cross-zonal

capacity in the event of force majeure or emergency situations. These costs also include the additional

costs from the procurement of balancing capacity due to the non-availability of the balancing capacity

given the curtailment of cross-zonal capacity.

4. The costs of ensuring firmness shall be shared in accordance with the regional methodologies developed

in accordance with Article 74 of the CACM Regulation and Article 76 of the SO Regulation for the cases

that fall within the scope of these methodologies.

5. Any costs of ensuring firmness which are outside the scope of the methodologies referred to in paragraph 4 shall be borne by the TSO requesting the curtailment.

Article 10

Pricing of cross-zonal capacity

1. TSOs allocating cross-zonal capacity for the exchange of balancing capacity and sharing of reserves

applying this methodology within the Baltic CCR shall calculate the cross-zonal capacity price for the

volume of cross-zonal capacity that is allocated for the exchange of balancing capacity and sharing of

reserves.

2. The price of cross-zonal capacity allocated for the exchange of balancing capacity and sharing of reserves

shall be calculated separately for each market time unit and each standard balancing capacity product.

3. The prices in EUR/MW of cross-zonal capacity per day ahead market time unit in each direction shall be

equivalent to the difference in cross-zonal marginal prices of a standard balancing capacity product in

bidding zones applying the market-based allocation process pursuant to Article 38(1) of the EB

Regulation.

Article 11 Sharing of congestion income

1. The congestion income shall be calculated per application of the market-based process pursuant to

Article 38(1) of the EB Regulation and day-ahead market time unit and shall be equal to the volume of

cross-zonal capacity allocated to the exchange of balancing capacity and sharing of reserves multiplied

by the price of cross-zonal capacity allocated in accordance with Article 10. The congestion income

pursuant to paragraph 1 will be shared in accordance with the methodology of Article 73 of the CACM

Regulation and in accordance with Article 41(4) of the EB Regulation.

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2. On a monthly basis TSOs of a cooperation applying the market-based process in accordance with Article

38(1) of the EB Regulation shall compare the monthly congestion income calculated in accordance with

paragraph 1 with the congestion income which could have been generated for the amount of cross-zonal

capacity allocated for the exchange of balancing capacity and sharing of reserves if allocated to the single

day ahead coupling instead. The TSOs of a cooperation applying the market-based process in accordance

with Article 38(1) of the EB Regulation shall inform all TSOs and regulatory authorities of the CCR and

ACER of the outcome of this assessment.

3. If the comparison pursuant to paragraph 2 shows a deficit on a monthly basis of generated congestion

income following the allocation of cross-zonal capacities for the exchange of balancing capacity and

sharing of reserves, the TSOs of a cooperation applying the market-based process in accordance with

Article 38(1) of the EB Regulation should pay a compensation to the single day ahead coupling to cover

such deficit. The costs of such compensation shall be split among the TSOs of a cooperation applying

the market-based process in accordance with Article 38(1) of the EB Regulation in accordance with the

distribution of shares of overall decreased procurement costs per TSO from the application of the market-

based process in the relevant month. The compensation to the single day-ahead coupling should be shared

among all TSOs in accordance with the shares of decreased congestion income pursuant to the

comparison in accordance with paragraph 3.

Article 12

Publication of information

1. The TSOs applying this market-based capacity allocation process shall publish all relevant and required

information on the transparency website of ENTSO-E according to Article 12(5) of the EB Regulation.

2. The TSOs applying this market-based capacity allocation process shall publish the following information

on the allocation of cross-zonal capacity for the exchange of balancing capacity and sharing of reserves as

soon as possible but no later than one hour before the single day-ahead coupling gate closure time, as

defined in accordance with Article 47(2) of the CACM Regulation, pursuant to Article 12(3)(h) of the

EB Regulation:

(a) date and time when the decision on allocation was made;

(b) period of the allocation;

(c) volumes allocated including the actual percentage limit applied in accordance with Article 5

(1)(a) to (c); and

(d) market values used as a basis for the allocation process in accordance with Articles 6(5) and 7(2).

3. The TSOs applying this market-based capacity allocation process shall publish the following information

on the use of allocated cross-zonal capacity for the exchange of balancing capacity and sharing of reserves

as soon as possible but no later than 1 (one) week after the use of allocated cross-zonal capacity, pursuant

to Article 12(3)(i) of the EB Regulation:

(a) volume of allocated and used cross-zonal capacity per day-ahead market time unit;

(b) volume of released cross-zonal capacity for subsequent time frames per day ahead market time

unit in accordance with Article 38(8) of the EB Regulation;

(c) estimated realised costs and benefits of the allocation process. The TSOs will, based on the bid

data for the respective standard balancing capacity product, estimate the reduction in

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procurement costs and estimated welfare gains compared to fulfilling the TSO demand without

allocating cross-zonal capacity for exchange of the respective standard balancing capacity

product. These estimated costs and benefits will be published as values for each bidding zone,

day ahead market time unit and each standard balancing capacity product for the balancing

capacity market where this methodology is applied.

4. Each TSO applying this market-based allocation process and increased the TSO demand in accordance

with Article 7(4)(b) shall publish information at least on the amount of the increase and the anonymised

bid curve from the standard balancing capacity not participating in the market-based process on which

basis the TSO demand was increased by no later than one day after the performed market-based

allocation process.

5. The TSOs applying this market-based allocation process shall publish the description of the requirements

of the algorithm for the cross-zonal capacity allocation function at least one month before its application.

6. The TSOs applying this market-based allocation process and using the option of Article 8(2)(d) shall

publish a detailed description how the possible costs associated to the congestion income assessment

pursuant to Article 11(4) are considered in the determination of the allocated volume of cross-zonal

capacity for the exchange of balancing capacity and sharing of reserves at least one month before the

option is used.

7. The TSOs applying this market-based allocation process shall publish an overview of the applicable

default limits for the maximum volume of cross-zonal capacity allocated for the exchange of balancing

capacity pursuant to Article 5(1)(a) and (c).

8. The TSOs shall monitor the efficiency of the forecasting methodology and conduct analysis on the

default limit for the maximum volume of cross zonal capacity allocated for the exchange of balancing

capacity and sharing of reserves and shall, by six months after the go-live of the market-based allocation

process and subsequently at least once a year, submit a report to the relevant regulatory authorities. This

report shall include at least:

(a) a comparison of the forecasted and actual market values of cross-zonal capacity for the exchange

of energy;

(b) assessment of occurred increases of the limits for the maximum volume of cross-zonal capacity

allocated for the exchange of balancing capacity and sharing of reserves in accordance with

Article 5(1)(b), including statistics on the amount of incidents, increased volumes and percentages,

reasons for the incidents and an analysis of the economic surplus effects on the SDAC;

(c) assessment of the impact on the price formation of the single day-ahead coupling due to the

allocation of cross-zonal capacity for the exchange of balancing capacity and sharing of reserves;

(d) assessment of impacts on the economic surplus of the SDAC and economic surplus from the

exchange of balancing capacity and sharing of reserves from the application of the market-based

allocation process and the specific impact following an increase of a default limit for the

maximum volume of cross- zonal capacity allocated for the exchange of balancing capacity and

sharing of reserves pursuant to the process described in Article 5(1)(c);

(e) assessment of the adjustment process according to Article 6 (2), including assessment of the

number of hours the adjustment has been made and assessment on the magnitude of the

adjustments made;

(f) where necessary, proposals to improve the accuracy of the forecasted market values, including a

different limit for the maximum volume of cross zonal capacity pursuant to Article 5(1) or

different mark-up values per bidding zone border pursuant to Article 6(2) based on the results of

the relevant analysis; and

(g) an assessment on the need to adjust the percentage limits on cross-zonal capacity

allocation described in Article 5(1).

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9. During implementation pursuant to Article 13(2), the TSOs shall inform regulatory authorities about the

progress and the outcome of the performed verification processes for implementing the market-based

allocation process.

TITLE 3 Final provisions

Article 13 Publication and implementation of the methodology for market-based capacity allocation

1. The TSOs shall publish this methodology without undue delay on the ENTSO-E website after a decision

has been made by the European Union Agency for the Cooperation of Energy Regulators in accordance

with Article 6(2) of the EB Regulation.

2. The TSOs shall implement this methodology by the time the cross zonal capacity on all bidding zone

borders of the Baltic CCR is calculated in accordance with the capacity calculation methodology

developed pursuant to the CACM Regulation, by establishing the cross-zonal capacity allocation

function to be ready for application of the market-based allocation process for the exchange of balancing

capacity and sharing of reserves, where two or more TSOs intend to commonly procure balancing

capacity.

Article 14 Language

The reference language for this methodology shall be English. For the avoidance of doubt, where the TSOs

need to translate this methodology into their national language(s), in the event of inconsistencies between the

English version published by the TSOs in accordance with Article 7 of the EB Regulation and any version in

another language, the relevant TSOs shall, in accordance with national legislation, provide the relevant

national regulatory authorities with an updated translation of this methodology.