Increase in the prices of the French Capacity Mechanism auction

In France, the capacity mechanism auction of 11 March 2021 set the price at €28.3K/MW for 2022. This is clearly up from the last two auctions around €18K/MW.


This upward trend reflects again this year an anticipation of tension on the balance of the French electricity system for the winter of 2021/2022.


There are several reasons for this tension, including Covid and the consequences it could again have on the maintenance schedule and availability of the nuclear fleet. Read our analysis of the winter of 2020/2021.


The announced closure of coal-fired power plants this year, in line with Emmanuel Macron's commitments, may also play a role, as there will be no capacity available this winter. More information on Novethic (in French). 


On the other hand, when analysing the order book of the different 2022 Capacity auctions, it is very interesting to note the antagonistic evolution of buy and sell orders. 

Indeed, we can see that buyers have a declining view of the market since the main buying levels have gone from €20K/MW in October 2020 to €14K/MW today. 

However, the selling levels have risen from €14K/MW in October 2020 to €28K/MW in the March 2021 auction, mainly due to the position taken by a major market player.

Find the supply and demand curves for Capacity Guarantees on EPEX Spot.

The next auctions should enable the various players to harmonize their vision of the electricity system for the coming winter.


The auction of 11 March 2021 also concerned the 2018 delivery year.

This was the last auction that allowed market players to close their position following the publication of the definitive Effective Capacity Levels by RTE. A low volume traded and a high bid led to a 50% reduction in the price of Capacity Guarantees to €5K/MW.


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