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Technical constraints
Technical constraints
Learn more about how the resolution of technical constraints works, an essential tool for the proper functioning of the electricity system as a whole.
Technical constraints mechanism
The outcome of the energy market is not always compatible with the laws of physics and compliance with the security criteria established by regulations. For this reason, the System Operator (SO) must adjust the resulting market schedule to the extent strictly necessary to guarantee system security. This process is called the resolution of technical constraints.
Why is the resolution of technical constraints necessary?
The reasons that can lead to this need for adjustment are varied. These include the existence of unacceptable overloads on the transmission grid, voltage control needs, the need for sufficient generation reserves, stability requirements, requests from distribution network managers to meet the needs of their networks, or other technical requirements.
How is the technical constraints resolution process carried out?
This adjustment of the resulting market schedule is carried out through scheduling due to technical constraints. Through this mechanism, the System Operator can reduce the output of some generators that had been scheduled in the market and increase the output of others which, due to their location or technical characteristics, are necessary to guarantee system security.
Scheduling due to technical constraints is applied after each session of the European electricity market. It can also be activated during real-time operation when system conditions require it.
Who provides the energy necessary to resolve technical constraints?
The volume of energy mobilised due to technical constraints depends on the market outcome and, in particular, on the location and technical performance of the facilities that have been scheduled. Not all units can resolve the same technical need: in many cases, the specific location of generators, storage facilities, or demand is a determining factor.
Therefore, technical constraints cannot always be resolved under conditions of full competition. When a need is localised at a specific point on the grid, only certain facilities can effectively contribute to resolving it.
Generally, the units necessary to resolve technical constraints that require an increase in production are those that had not been scheduled in the market, or had only been partially scheduled, because their bids were more expensive than those of other production units.
Where does the cost come from?
The cost of scheduling due to technical constraints depends on two main factors: the volume of energy that needs to be mobilised and the price at which that energy is remunerated.
This price is not set by Red Eléctrica as the System Operator, but is determined by the bids submitted by generators, storage facilities, or demand. The increase in energy used to resolve technical constraints is remunerated to the owning companies at the price bid by each of them, under a 'pay-as-bid' scheme.
Therefore, the cost of technical constraints is difficult to forecast. The price depends entirely on the bids of market participants, whilst the volume of energy required is conditioned by multiple factors: the market outcome, facility availability, grid status, operating conditions, and system security needs.
Although this scheduling is essential to make the market outcome viable and guarantee safe operation, the System Operator considers it necessary to continue making progress on the regulatory front. The objective must be to minimise the energy mobilised due to technical constraints and to encourage the bids submitted by participants to reflect more competitive prices.
Public information and transparency
Red Eléctrica transparently publishes information on technical constraints: energy redispatches, prices, volumes, causes, security limitations, and indicators of non-integrable renewable energy, among other data. This information is freely available on the e·sios public website.