Nordic TSOs have submitted amended proposals for a common Nordic aFRR capacity market

The aFRR capacity market is expected to dramatically increase the efficiency with which the Nordic power system is balanced, unlocking roughly €50m each year in socioeconomic benefits on a Nordic level and thereby helping to keep end users' costs down.

In October, the Nordic TSOs received a Request for Amendment from the Nordic NRAs regarding the legal proposals submitted by the TSOs to establish a Nordic aFRR capacity market. Read more here.

The most important changes in the Nordic TSO’s amended legal proposals are:

Pay-as-clear pricing – Nordic TSOs have, in line with the desires of many stakeholders as expressed through the earlier consultation exercise, developed a pay-as-clear pricing model that will generate clear investment signals for potential providers.
Transfer of bids within bidding zones – Following a specific consultation on this issue, and in line with stakeholders' requests, Nordic TSOs will open up the possibility for transfer of bids among BSPs within the same bidding zone.
D-1 timing – The proposed timing of the market's gate closure has now been moved to D-1, bringing it closer to real time.The aFRR capacity market is the cornerstone of efforts to both modernize the balancing of the Nordic system, and to ensure the continued safe operation of the power system in times when the energy source mix are changing. It will also help sending efficient signals on the need for new aFRR capacity in the region and help give sufficient time for this capacity to come online in advance of the challenges ahead.

More information on the expected go-live of aFRR capacity market will be provided when we have received a decision from the NRA’s in Q1 2020.

Increased aFRR capability in the Nordic region is a pre-requisite for a safe transition to the new Nordic balancing model based on 15-minutes imbalance settlement period and for connection to the European platforms.