Technology-neutral capacity mechanisms for a secure energy future

Project Description

In recent years, the electricity market has been subject to strong fluctuations and market interventions, which can sometimes have strong implications for the security of supply. In addition, high shares from renewable energy sources (RES) triggered by support mechanisms have led to strongly fluctuating generation and increasing demand for flexibility as well as additional generation technologies and storage capacities. Furthermore, the war in Ukraine has triggered an energy crisis with unprecedented price increases since mid-2021. Additional price volatility, uncertain geopolitical situation and short-term market interventions do not create long-term planning certainty and therefore insufficient investment incentives. The main concern is that, besides further RES expansion to achieve the ambitious decarbonization targets, the energy-only market will not provide sufficient incentives in the future to make new investments. In many European countries, a number of different capacity mechanisms (CMs), such as centralized or decentralized capacity markets or strategic reserves, are already in place today. In addition, other innovative options have been proposed (e.g. capacity subscriptions). The core question of the TeKaVe project is therefore whether the market system in Austria in its current form (energy-only market) is capable of maintaining a secure supply energy system at the same time as achieving Austria’s decarbonization goals. This question is investigated from a regulatory as well as an economic points of view.

Project Consortium

  1. AIT Austrian Institute of Technology GmbH
  2. Energieinstitut an der Johannes Kepler Universität Linz

Funding provider


Funding program

Energie.Frei.Raum 2. AS 2020
Scroll to Top