European Power Exchange To Extend Its Services To Other European Regions - EPEX SPOT Designated As NEMO On Its Markets

The European Power Exchange EPEX SPOT has been designated by the national regulatory authorities in the EU members states Germany, France, Great Britain, the Netherlands, Austria and Luxembourg as Nominated Electricity Market Operator (NEMO). The EU Regulation establishing a guideline on Capacity Allocation and Congestion Management (CACM), in force since 14 August 2015, obliges all EU member states to officially designate an Electricity Market Operator for the Day-Ahead and Intraday markets within four months. Its objective is to promote effective competition in the generation, trading and supply of electricity, to ensure the optimal use of the transmission system while respecting the need for a fair and orderly market and price formation. The decision by the Belgian national authority to designate a NEMO is expected soon. Switzerland, also covered by EPEX SPOT but not being part of the European Union, has not implemented the EU Regulation for the time being.

NEMO is a new status created by this Regulation which establishes a set of harmonised rules in particular for Market Coupling, which allocates cross-border transmission capacity more efficiently by combining it with energy transactions on power exchanges. The CACM Regulation provides a new framework now clearly defining the tasks and obligations of the transmission system operators and Power Exchanges designated as NEMOs. “What has been carried out in the past on a voluntary basis and with a cooperative spirit has now become European law”, says Wolfram Vogel, Director Public & Regulatory Affairs of EPEX SPOT. “The new Europe-wide arrangements under CACM will build on and eventually replace the existing market coupling solutions. This process is likely to take one to two years to complete.”

A NEMO designated in one member state can operate power spot markets in other European countries, using its NEMO status as a “passport”. EPEX SPOT plans to make use of this passport to offer services in new markets beyond its existing core in Central Western Europe and the UK. “We are proud to be NEMO for Day-Ahead and Intraday markets in all the countries we applied”, says Jean-François Conil-Lacoste, Chairman of the Management Board of EPEX SPOT. “The CACM Regulation creates a new level playing field for NEMOs in Europe. We welcome the opportunity to use the passport and increased competition among NEMOs that comes with it. Competition will help triggering innovation that best serves the needs of the market.”