The allocation of system costs: Future-proofed methodologies for decarbonising European power sectors

J.P. Chaves, P. Mastropietro, M. Troncia, P. González, T. Gómez

Sustainable Energy, Grids and Networks Vol. 45, pp. 102143

Resumen:

The increased use of renewable energy sources, among other factors, is causing system costs to grow quickly in European power sectors, especially those related to frequency control and congestion management. Currently, most European countries allocate these costs to consumers using simplistic methodologies, either via network tariffs or specific volumetric charges. These methodologies require urgent reform. This article reviews the economic theory and European experiences regarding the allocation of system costs and puts forward a comprehensive high-level proposal to improve the design of these charges. Balancing capacity costs should be partially embedded in the imbalance price, with price caps limiting the possibility of very high prices during periods of low imbalance volumes. Congestion management costs, like network expansion costs, are driven by transmission capacity scarcity and should be recovered through network tariffs. Any system costs that cannot be allocated according to cost causality should be recovered through stabilised residual charges that do not distort the efficient signals sent by cost-reflective charges and prices. Discounts and exemptions for certain categories of end users should only apply to these residual charges. The impact of this proposal has been tested in a case study based on the Spanish power system.

Resumen divulgativo:

Este artículo revisa la teoría económica y las experiencias europeas en materia de asignación de los costes del sistema y presenta una propuesta integral para mejorar el diseño de estos cargos.

Palabras Clave: System services; Ancillary services; System costs; Grid congestion; Network tariffs

Índice de impacto JCR-JIF y cuartil WoS: 5,700 - Q1 (2025)

Referencia DOI: https://doi.org/10.1016/j.segan.2026.102143

Publicado en papel: Marzo 2026.

Publicado on-line: Febrero 2026.

Cita:
J.P. Chaves, P. Mastropietro, M. Troncia, P. González, T. Gómez, "The allocation of system costs: Future-proofed methodologies for decarbonising European power sectors", Sustainable Energy, Grids and Networks, Vol. 45, pp. 102143, Marzo 2026. [Online: Febrero 2026] doi: 10.1016/j.segan.2026.102143