Higher prices in Austria than Germany in first auction after power price zone split

The first day-ahead auction on the EPEX SPOT power exchange after the split of the common power price zone between Austria and Germany, which becomes effective today (1 October), saw higher prices for Austria than Germany, writes the Austrian Energy Agency in a press release. Prices in Austria on average were 1.94 euros, or 3.2 percent above those in Germany. Action became necessary in the common power price zone because Austrian electricity consumers often bought more power from German providers than the grid could transport. This led to costly re-dispatch measures to deal with the congestion and loop flows to neighbouring countries. The European Commission had put pressure on the German government and the country’s transmission system operators to fix the problem.
“The effects on the Austrian power market are not massive so far,” write the regulators Federal Network Agency (BNetzA) and E-Control in a joint press release. An annual average price difference of 2-3 euros seems most likely, depending on gas and CO₂ prices, they add.
In a separate press release, Stefan Kapferer, head of utility association BDEW, said that the split will not ease the need for accelerated power grid development, and it “remains to be seen” if it actually leads to the desired relief for the electricity network. “In any case, this step contradicts the pursuit of the largest possible and thus most liquid electricity markets in Europe,” said Kapferer.

Find the press release in German here, the BDEW release in German here, and the BNetzA release in German here.

For background, read the CLEW factsheet Interconnectors & blockages – German grid at odds with EU power market and the dossier “Energiewende hinges on unblocking the power grid”.