We facilitate the development of the electricity market

#5. Market facilitation –

We facilitate the development of the electricity market

As generation sources become increasingly volatile and decentralised, a continuous adaptation of the markets is necessary. As a market facilitator, we are developing solutions at national and European levels to increase the efficiency and liquidity of the different electricity markets (wholesale, ancillary services, reliable capacities, etc.). To do so, we cooperate with other TSOs, power exchanges, traders, regulators and governments. Consumers and their interests lie at the core of this - we make sure that we are creating additional value for society via market instruments. We are committed to delivering more consumer comfort and fully recognise the valuable contribution that consumer flexibility will play in establishing a fully decarbonised system.

HOW WE DRAW ON AND AFFECT THE CAPITALS: INPUTS AND OUTCOMES

Employees & Subcontractors

We employ the skills and knowledge of our staff as they oversee the balancing of the market in real time, explore the use of new digital tools and undertake research related to the changes that are needed to enable the system to remain adequate and balanced in the future. Our activities encourage the development of our staff, as the latter further their skills and knowledge about the Belgian, German and European energy markets.

Intellectual

Our TSO licences confer us with balancing responsibilities and our know-how and access to data give us the means to undertake research and provide industry, partners and policymakers with research related to the energy transition. Over time, we constantly enhance our organisational processes and knowledge, including the ways in which we collect and use the data we have access to.

Social & Relationship

We keep improving and strengthening our relationships with our stakeholders. We work closely with academia and energy experts, industry and the regulators in our home countries, designing and implementing an energy market that will valorise consumer flexibility, enhance their comfort, and support the energy transition. Beyond working with these national partners and stakeholders, we also work with other European TSOs to calculate and allocate cross-border transmission capacities, furthering the integration of the European energy market.

STRATEGIC CONTRIBUTION

Deliver the infrastructure of the future & develop and operate a sustainable power system

Develop new services creating value for customers in the energy system

In line with our Consumer-Centric Market Design, we facilitate market participation and the exchange of electricity on a closer to real-time basis and encourage the supply of more flexibility for the system (including prosumers and the owners of electric vehicles).

RISK MANAGEMENT

Most relevant opportunities

Most relevant risks

Digital transformation; Relevant role played in the energy transition leading to a sustainable future

Changing/new regulatory conditions; Balancing; Adequacy; Contingency events and business continuity disruption; Failure of information & communication technology (ICT), data security and protection measures

Please see the chapter entitled 'Risk management' for an explanation of these

We are responsible for ensuring an efficient and transparent electricity market, so maintaining the balance between supply and demand around the clock.

OUR PERFORMANCE

30 million

End users

Please see the chapter entitled 'Our performance' for further information

HOW WE DELIVER VALUE

Having ultimate responsibility for the balance of demand and supply in Belgium and parts of Germany and procuring ancillary services benefits both energy producers and consumers in Belgium, Germany and Europe more widely, since we are working towards the further integration of the European energy market.

Determinant factors which have a bearing on our facilitation of the market include ensuring cost and process efficiency whilst adhering to the legal and regulatory environments we organise markets in. To ensure the reliability of our grid and maintain security of supply, we organise a balancing market through which we can access the flexibility offered by balancing service providers (BSPs), who offtake and inject electricity into the grid. Balancing responsible parties (BRPs) ensure the balance between these offtakes and injections across a range of access points on a fifteen-minute basis. We also take ultimate responsibility for their work, meaning that if BRPs are unable to fulfil their function, we oversee the procurement of ancillary services, which include securing extra flexibility or capacity from generators and consumers to reduce the imbalance between supply and demand.

Material topics

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Our research into maintaining an adequate system and integrating new flexibility providers is of value to public authorities and regulators in our home markets: they use this when taking decisions about the amount of capacity Belgium and Germany need, and who should be able to provide them, as both countries work towards net zero.

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Our market facilitation activities also create value for wider society by encouraging the integration of renewable energy into the system. Indeed, as the latter shifts to comprise a large amount of decentralised, intermittent RES, it needs a high amount of flexibility in order for balance to be maintained. Therefore, a well-designed energy market which permits more short-term trading and a large number of new, smaller market players (including prosumers and the owners of electric vehicles) to take part in it will help to meet this need; the rollout of smart meters will significantly contribute to understanding how these new flexibilities function.

As part of our pre-qualification responsibilities (which involve establishing clear technical parameters that players need in order to be able to participate in the market), we undertake research and try to remove as many market barriers as possible, ensuring that every player is offered transparent, non-discriminatory access to the grid. We also explore and develop new digital tools which facilitate market participation and the exchange of electricity on a closer to real-time basis and encourage the supply of more flexibility for the system. These goals are outlined in our proposed CCMD (see following pages), which was published in 2021. It aims to place consumers firmly at the centre of the market, allowing them to play a leading role in the energy transition through the valorisation of their flexibility whilst benefiting from consumer-centric energy services - so ensuring customer orientation and satisfaction. In order to implement the CCMD, we are committed to real stakeholder dialogue and interaction with academics and other market participants; at the same time, ensuring that our staff are skilled, knowledgeable and ready to lead the required change is also crucial.

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White paper on a Consumer-Centric

Market Design

In June 2021, the Elia group published a white paper outlining a new market model and calling for increased collaboration amongst players from across the energy sector. The proposed Consumer-Centric Market Design (CCMD) aims to give consumers a more active role in the electricity system and the energy transition.

As electrification spreads across society and high amounts of renewable energy are being integrated into the grid, electricity demand must be matched to electricity supply; encouraging consumers to adapt their behaviour to the state of the grid is therefore necessary. Whilst the CCMD aims to unleash better energy services for consumers ‘behind the meter’, it will also facilitate the energy transition.

Through the publication of its white paper, the Elia group aims to open up discussions and foster collaboration between stakeholders from across the energy value chain and wider society. As part of this, the group hosted its first hackathon in October (see the section entitled ‘Additional services’). Our energy system needs to adapt to respond to the challenges of today and evolve and prepare for those of tomorrow. We welcome any concrete initiative that could help us realise that, and bring forward the flexibility, responsiveness and liquidity required in our energy markets.

Catharina Sikow-Magny, Director Internal Energy Market at the European Commission’s Directorate-General for Energy

THE WHITE PAPER WAS LAUNCHED DURING A LIVESTREAMED EVENT IN JUNE - YOU CAN WATCH IT HERE: We have learned that customer expectations have fundamentally changed. Customers want to be in control and expect fast, reliable and individualised products and services without any hassle. The potential held in this is huge, as electric cars will soon dominate the market. So let us work together and make this possible for our customers.

Johan Thijs, CEO of KBC Group

The Consumer-Centric Market Design is a creditable effort to shake up the market. Questions and issues surrounding it still need to be addressed, as is always the case for innovative ideas that bring about change.

Tinne Van der Straeten, Belgian Federal Minister of Energy

Today, we already have the necessary technology and solutions that will take us to net zero. But those are only half the story. Giving users full control over their own energy usage, through digitalisation, is just as important. The benefit of this is obvious and immediate.

Max Viessmann, Co-CEO of Viessmann Group

BELGIUM’S FIRST CRM AUCTION

In late October, Elia announced the results of its first CRM auction for the 2025-26 delivery year. The CRM was introduced by the Belgian Federal Government to secure the country’s supply of electricity following the legally required nuclear phase-out, which is due to be completed by 2025. Elia organised the first CRM auction at the request of the Belgian Minister of Energy and with the approval of the European Commission. On 23 December 2021, the Belgian Government settled on a compromise, whereby the last existing nuclear power plant is due to close in 2025. However, ministers left open the possibility of extending the life of two reactors if security of supply has not been secured by that point.*

Belgium’s phasing out of nuclear power will begin with the closure of one reactor on 1 October 2022.

PRESS CONFERENCE REGARDING BELGIUM’S NUCLEAR PHASE-OUT

WITH FEDERAL MINISTER OF ENERGY

TINNE VAN DER STRAETEN AND PRIME

MINISTER ALEXANDER DE CROO.

ELIA GROUP CEO CHRIS PEETERS

ATTENDED THE NEGOTIATIONS WHICH

PRECEDED THE PRESS CONFERENCE, LENDING HIS EXPERTISE TO THE

DISCUSSIONS.

*On 18 March 2022, the Belgian Federal Government announced that it would extend the life of its two newest nuclear power plants by 10 years (the Doel 4 and Tihange 3 reactors). The feasibility of this will be examined and worked out over the coming months.