Data Item Details

Name: Costs incurred or projected to finance capacity mechanisms per unit demand – 2020-2022, and expressed as a percentage of the annual average day-ahead price in Europe – 2021 (euros per MWh of demand and %, respectively)

Source: ACER calculations based on NRA and ENTSO-E data

Reference: Figure 10

Comment: Costs expressed as percentages of average day-ahead prices refer to 2021 data. Costs per unit demand are based on total annual realised or projected payments to capacity providers for delivery of capacity in the relevant year. Demand data is derived from Eurostat data or ENTSO-E Transparency Platform. Demand in 2021 was used for 2022 calculations.In Belgium, the new capacity mechanism payments start from 2025 onwards. No auctions for the previous capacitymechanism took place for 2020 and 2021. The overall costs for France are an approximation considering that all capacity certificates are valued at the market reference price (PRM). A significant share (which varies year-on-year) of the capacity certificates is implicitly valued through the “Accès Régulé à l’Electricité Nucléaire Historique” (ARENH) mechanism, a scheme that enables suppliers to purchase electricity from nuclear generators at a regulated price. Therefore, the actual costs for France are dependent on the reference used to value the capacity certificates related to the ARENH mechanism. For Ireland, cost data was not provided this year, so 2020 MMR data was used. Cost data for Italy up to 2021 refer to ‘legacy’ capacitypayments from the previous capacity remuneration scheme. For 2022, they refer to both the new capacity mechanism and thelegacy contracts while for 2023 only to the new capacity mechanism. For Portugal, costs refer to capacity payments provided to hydro power plants due to “legacy” contracts. For Spain, the depicted costs refer to the remaining long-term investment incentives awarded to installations before these incentives were cancelled in 2016.

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Figure 10

Country

Delivery Year

Fields to export Ratio of Annual Average Day-Ahead 2021 price (%) Costs (euros/MWh)

Country	Delivery Year	Ratio of Annual Average Day-Ahead 2021 price (%)	Costs (euros/MWh)
IE	2021	8.90	12.08
IE	2020	0.00	9.63
IE	2022	0.00	11.83
PL	2020	0.00	0.71
PL	2021	8.50	7.43
PL	2022	0.00	7.41
FR	2020	0.00	4.12
FR	2021	5.80	6.31
FR	2022	0.00	5.17
IT	2020	0.00	0.65
IT	2021	0.50	0.67
IT	2022	0.00	4.35
ES	2020	0.00	0.51
ES	2021	0.40	0.42
ES	2022	0.00	0.35
FI	2020	0.00	0.16
FI	2021	0.20	0.12
FI	2022	0.00	0.08
DE	2020	0.00	0.15
DE	2021	0.10	0.14
DE	2022	0.00	0.14
SE	2020	0.00	0.08
SE	2021	0.10	0.05
SE	2022	0.00	0.05
PT	2020	0.00	0.00
PT	2021	0.00	0.04
PT	2022	0.00	0.07