The mechanism will operate for 10 years and is designed to ensure that sufficient energy generation, storage, and demand-side flexibility resources remain available during periods of stress on the electric power system.
Power suppliers will be selected at auctions
According to the scheme, the Spanish Transmission System operator (CSE) will purchase the capacity needed to meet the country's electricity reliability standards. Capacity suppliers will receive remuneration in exchange for a commitment to be available when needed during periods of supply shortage or peak demand.
Participation will be awarded at competitive auctions, which should be transparent, technologically neutral and non-discriminatory. The mechanism is expected to provide about 900 million euros per year in support. During the 10-year implementation period, the total amount of financing may amount to about €9 billion, although the final amount will depend on the auction results and actual capacity procurement needs.
Cross-border participation planned
Initially, participation will be limited to projects located in Spain. Nevertheless, the Spanish Government has announced its intention to open a mechanism for
