Foundation Charter of the Common allocation office for Central East Europe (CAO) signed on 17 July by 8 TSOs
The European electricity market is currently divided into seven European regions in order to enhance the Internal European Electricity Market by fostering market developments firstly at a regional level. One of these regions is Central-Eastern Europe (CEE) which includes Austria, Czech Republic, Germany, Hungary, Poland, Slovakia and Slovenia. The eight transmission system operators (TSO) Verbund – Austrian Power Grid AG, ČEPS a.s., Electro-Slovenija d.o.o., E.ON Netz GmbH, MAVIR Hungarian TSO Company Ltd., PSE-Operator S.A., SEPS a.s. and Vattenfall Europe Transmission GmbH have now established the common capacity allocation office (CAO) to implement a regional coordinated congestion management in CEE.
The joint “CAO Central Allocation Office GmbH” for the CEE region will be located in Freising near Munich in Germany. It will allocate yearly, monthly, and daily rights for cross-border electricity transmission in the CEE region on behalf of the eight TSOs and will provide the settlement. The allocation process should be based on flow-based methodology in order to achieve more precise representation of physical electrical power flows associated with the use of transmission rights.
The new company will replace several multilateral and bilateral activities, allocating scarce capacities at the borders of the countries in the CEE region. The implementation of the new flow based allocation mechanism will be preceded by a test run with market participants.