Minimum Income Orders in the European Price Coupling of Regions: Use or abuse?

Abstract

The European Price Coupling of Regions incorporates complex order options inherited from the joining day-ahead power exchanges. The option called ‘Minimum Income Orders’ represents a major burden to price formation and compromises transparency and optimality. An analysis of market data calls into question the use and purpose of this option. Simplifying the day-ahead market clearing is pivotal to the advancement of a European electricity target model centered on renewable energy and active consumer participation.