France

The annual net balance of scheduled electricity exchanges through the interconnection with France was 1,877 GWh as an exporter balance for the second consecutive year, compared to 9,095 GWh last year. Scheduled import reached 8,385 GWh, 52.7 % higher than the previous year. Scheduled exports amounted to 10,262 GWh, 29.6 % lower than last year's figure, which remains the all-time high. Net monthly balances were exporters from January to May, as well as in November. The maximum export balance was recorded in March, while the maximum import balance was recorded in July.

During 2023, a high utilisation rate was registered for this interconnection, most of the time in the direction from Spain to France (56 % of hours). The average capacity utilisation rate in this period was 84 %. These six months of exporter balance are mainly due to two causes: high penetration of renewables in the Spanish system and high electricity prices in France. Prices in France were higher than in Spain during the first five months of the year, although they were rather similar in May and November. Therefore, during the first four months of the year, 82 % of hours have shown an export balance, and more than 61 % of the export capacity has been used at 100 %, i.e., there was congestion in the exporter direction. In November, the month with the highest percentage of renewables in the structure, 80 % of hours presented an export balance, and 60 % of the export capacity was used 100 %. From July to October, almost 71 % of hours showed an import balance, but only 39 % of the capacity was used 100 %, which means that there is less congestion.

Exchange capacity and net balance of scheduled exchanges at the interconnection with France in 2023

As for the day-ahead capacity usage, there was a high level of utilisation of this interconnection, however, the congestion rates were slightly lower than in the previous year. As a result, 28.55 % of hours showed congestion in the France-Spain direction (compared to 9.9 % last year), with an average price difference of €29.0/MWh; 38.68 % of hours showed congestion in the Spain-France direction (compared to 63.4 % last year), with an average price difference of €46.6/MWh; and the remaining 32.77 % of hours showed no congestion on this interconnection.

Hours with and without congestion in the interconnection with France in 2023

The levels of congestion in exchange capacity in the day-ahead horizon were higher in the Spain-France direction from January to May and in November, when the price of electricity in the day-ahead market in Spain was lower than in France. July is the month with the highest number of hours in which both systems were coupled. The month of January presented the highest level of congestion in the interconnection.

The average absolute price spread is higher than €10/MWh, except in June, reaching average differences of more than €60/MWh in January. In April, October and December, the differences are over €30/MWh. In this respect, it should be mentioned that the European Commission considers that average spread values above €2/MWh reflect a need to reinforce an interconnection.

The congestion rents generated in 2023 in this interconnection amounted to 998.1 million euros (130.6 million in the importer direction and 867.5 million in the exporter direction), with 50 % of this total corresponding to the Spanish electricity system. This value is below the rents generated in 2022, because the gas price cap mechanism was being applied last year in the Iberian market. This meant that the price differences between this market and the French market were very high, giving rise to rent volumes never before recorded. In 2023, although the mechanism was in force throughout the year, it was not applied since February.

Congestion rents resulting from the international management mechanisms in the interconnection with France

€ Million

The origin of the rents consists of 84.1 % from auctions, 15.3 % from the day-ahead horizon and 0.6 % from the Replacement Reserves.

With regard to the prices resulting from the exchange capacity auctions, the marginal price of the annual capacity auction for the year 2023 in the Spain → France direction was equal to €132.45/MW, almost 4 times over the price of the capacity in the annual auction for 2022 (€33.77/MW). In the France → Spain direction, the resulting marginal price was equal to €3.95/MW, which represents a reduction of 36 % compared to that recorded in the same direction for the annual auction of 2022 (€6.21/MW).

The maximum price of the capacity allocated in the monthly auctions was recorded in August, in the France → Spain direction with a value of €12.78/MW, much higher than the €4.68/MW registered on March 2022. In the Spain → France direction, the maximum price was reached in January, at €118.0/MW, almost 3 times that of September last year.

Balancing energy exchanges across this border via the European platform for the management of balancing energy from RR-type replacement reserves amounted to 158.8 GWh of imports and 313.4 GWh of exports.

In 2023, it was necessary for the operators of the Spanish and French electricity systems to implement coordinated counter-trading actions (scheduled exchanges in the opposite direction to the existing flow established to guarantee the firmness of the trading schedules in the event of capacity reductions), for a total value of 1,253 GWh, a figure lower than the 1,333 GWh scheduled the previous year. 56 % were scheduled in the import direction, and the remaining 44 % in the export direction.

Annual evolution of counter-trading in the interconnection with France