Interim Coupling Project prioritised over Core flow-based

European Commission sets the priority on the Interim Coupling Project, Core flow-based market coupling project is delayed until 2022 - the saga of the last months in the TSOs and NEMOs’ community is coming to an end!

Context: the interim coupling project (ICP) to couple the 4M MC countries (CZ, SK, HU, RO) with DE, AT and PL has been set up a couple of years ago, as a low-hanging fruit to couple these countries together with a NTC approach, awaiting the go-live of Core. An important rationale was that flow-based market coupling, as mandated by CACM for this region, would still require quite some time, and that making a quick step to implement NTC coupling was worthwhile (and also one of the main objective of CACM). However ICP has been delayed multiple times due to local implementation issues. In parallel, the Core project developed quite well. A go-live window of May to September 2021 for Core was announced in summer 2019, and the implementation progressed according to plan since then.

This led to a situation where Core and ICP started competing with each other’s, in terms of resources and system update in particular, which in turn led to further delay of ICP due to uneven engagement and some questions on the relevance of ICP. The divergence of interests led to an escalation towards NRAs and the European Commission, with as main question whether we should implement first ICP and then Core, or if we should focus on Core only. Many different variants of implementation timelines were provided, with different assumptions. The main outcome was clear: going first for ICP would trigger a delay on Core. Tough question for the commission to set the priority!

The outcome has been announced today to the concerned NRAs, NEMOs and TSOs: ICP must be implemented first. The new timeline foresees a go-live window of ICP starting in April 2021, and a go-live window of Core starting in February 2022.

Bottom line: we will experience an interesting gradual evolution of the market coupling, starting with NTC and evolving towards flow-based. This is supported by many market parties I believe. It will also enable further market coupling projects with Bulgaria. 

Still in terms of efficiency of the capacity calculation, the improvements brought by flow-based are postponed. It will lead to some specific challenges, in particular related to the 70% requirement of the Clean Energy Package, since its implementation and monitoring is particular arduous in a NTC approach.