(Montel) Pan-European power exchange Epex Spot has started consulting partner exchanges and traders on lowering the threshold price at which a second day-ahead auction is triggered, the bourse told Montel.
“Epex Spot sees a need to lower the threshold that triggers a second auction procedure and we have started the discussion with the other Nemos (nominated electricity market operators), as well as market participants,” said Davide Orifici, director of public and regulatory affairs at Epex Spot.
On 18 April and 26 May, the exchange was forced to hold a second day-ahead auction for the coupled European power market after the Dutch spot price failed to clear above the permitted floor price of EUR -150/MWh on both occasions.
Market operators are required to re-run auctions if prices clear below EUR -150/MWh or above EUR 2,400/MWh, while prices are outrightly capped at EUR -500/MWh and EUR 4,000/MWh.
No rise in volumes
The Netherlands has seen a huge surge in renewable energy capacity, especially rooftop solar, which is typically more difficult to predict as installations are placed on private buildings.
Since the start of the year, the country has already seen more than 100 hours of negative day-ahead electricity prices, compared with 83 hours over the course of 2022.
“We are assessing the situation in close cooperation with our members and, depending on the outcome, will inform the market participants and other relevant stakeholders in due time,” Orifici told Montel.
Extremely low prices had not resulted in a noticeable rise in trading volumes, he said.
“On most of Epex Spot day-ahead markets, there is generally a negative relationship between traded volumes and prices, meaning the lower the prices, the higher the traded volumes… However, once the prices reach the extreme negative domain, the relationship stops,” he added.