Main auction

The main capacity market auction is a process organized by the transmission system operator to procure sufficient capacity resources to ensure the reliability of electricity supply in the future. These auctions are a crucial component of the capacity market, aimed at stabilizing and securing the power system, especially given the dynamic changes in the energy mix and the increasing share of renewable energy sources.

Key aspects of the main capacity auction:

Purpose of the main auction:
To guarantee the availability of the required capacity in a specific delivery year (typically a few years after the auction) to meet peak electricity demand.

Participants:

• Generation units (e.g., coal, gas, renewable energy sources).
• Demand Side Response units.
• Energy storage systems.

Auction mechanism:
The auction is conducted in a competitive system where capacity providers (market participants) submit offers to supply capacity in the designated delivery year.
The system operator selects offers starting with the lowest prices until the required capacity volume is reached.

Benefits for providers:

• Long-term contracts ensuring stable revenue.
• Additional funding for modernizing generation units.
• Importance for the power system:
• Enhancing the country's energy security.
• Promoting resource efficiency and flexibility to adapt to changing market conditions.

Impact on consumers:

• Stable access to electricity at competitive prices.
• The costs of operating the capacity market may be reflected in energy charges, providing transparency in financing.

In Poland, the main capacity market auction is organized by Polskie Sieci Elektroenergetyczne (PSE), and its outcomes are vital for energy security and investment planning in the energy sector.