The European Network of Transmission System Operators for Electricity (ENTSO-E) has released its latest report reviewing progress in capacity allocation and congestion management (CACM) mechanisms between June 2024 and May 2025. The report details ongoing efforts to strengthen Europe’s interconnected electricity system, aiming to enhance efficiency, reliability, and market integration under the Capacity Allocation and Congestion Management (CACM) and Forward Capacity Allocation (FCA) Regulations. Advancements in these areas are essential to achieving efficient resource use, cost-effectiveness, and security of supply for European consumers.
According to ENTSO-E, ongoing developments in capacity allocation, market coupling, and forward markets are reinforcing Europe’s cross-border electricity integration efforts. The report notes that the summer of 2024 saw relatively low electricity prices due to strong nuclear, hydro, and renewable generation. However, as winter approached, prices increased amid declining gas storage levels and rising geopolitical tensions that affected supply routes. By early 2025, electricity prices peaked above EUR140 per MWh in some markets before declining sharply in March and April due to warmer weather, strong solar output, and lower gas prices. A significant achievement during the reporting period was the successful implementation of bilaterally coordinated capacity allocation on all Ukrainian borders in early 2024. Building on this, discussions began in June 2024 on the introduction of monthly long-term and intraday auctions, with new rules under development by expert groups.
The report reiterates the importance of the EU Electricity Regulation’s Article 16(8), which requires TSOs to make at least 70 per cent of transmission capacity available for cross-zonal trading. While some TSOs or member countries operate under temporary derogations or action plans, ENTSO-E’s annual market report provides a detailed overview of compliance levels and differences across countries. The association also emphasises the need for caution when applying the 70 per cent rule in intraday timeframes to preserve system security.
In forward markets, where cross-zonal transmission rights are allocated through the Joint Allocation Office (JAO), ENTSO-E reports high operational performance. Preparations are underway for long-term flow-based allocation (LTFBA) across the core and Nordic capacity calculation regions, planned to go live by the end of 2026 for yearly and monthly products in 2027. Additionally, the regular update of the Harmonised Allocation Rules (HAR) continues, while an amendment to the FCA Guidelines, expected in June 2026, is anticipated to significantly shape the future of forward markets.
The second half of 2024 witnessed key advancements in market coupling. Following the successful intraday auctions (IDA) go-live in June 2024, the Nordic flow-based day-ahead (DA) coupling was implemented in October 2024. Another landmark in 2025 was the synchronisation of the Baltic States’ electricity systems with the Continental European Synchronous Area (CESA) in February, strengthening energy security and regional resilience.
Parallelly, the introduction of the Multi-NEMO Arrangement (MNA) in Romania, with the country’s commodities exchange Bursa Romana de Marfuri (BRM) joining as a new Nominated Electricity Market Operator (NEMO), marked an important step toward market diversification. On 30 September 2025, the European Union’s (EU) day-ahead electricity market moved from hourly to 15-minute trading intervals. The 15-minute market time unit (MTU) is part of the Single-Day Ahead Coupling (SDAC), the system that connects day-ahead electricity markets across EU countries. With this change, electricity prices will now be calculated every 15 minutes, reflecting more accurately the expected electricity generation and demand in the electricity system.
Looking forward, ENTSO-E and NEMOs are focusing on upcoming milestones, including the Core Advanced Hybrid Coupling (AHC), Baltic MNA, and implementation of flow-based (FB) methods in intraday trading. These developments represent significant progress toward a fully harmonised, efficient, and interconnected European electricity market designed to deliver affordable, reliable, and sustainable power to all EU citizens.
The full report can be accessed here.
