Europex position paper on Cross-Border Congestion Management and Market Coupling

Brussels, 6 October 2006 | The creation of a truly competitive Internal Electricity Market (IEM) requires the full integration of the participating national and regional markets. The challenge now is twofold. On the one hand, interconnection capacity should be expanded where it is currently inadequate to support the increasing volume of cross-border commercial transactions fostered by the liberalisation of the European electricity sector. On the other hand, congestion should be managed efficiently in order to minimise distortions and allocate the available capacity to its most valuable uses. Indeed, given the difficulties of building new capacity, efficient congestion management provides the more readily attainable route for reaping the benefits of the IEM. Furthermore, the prices from efficient market-based congestion management solutions provide the right investment signals for the optimal strengthening of the European network. Cross-border congestion management is therefore an essential ingredient in the construction of the IEM.

Given this background, the attached document presents Europex position on congestion management in the IEM and on the related institutional and governance issues.