The balancing mechanism. How to ensure the power production-consumption balance in a market opened to competition

As electricity is a non-storable product in large quantities, generation and consumption have to be balanced at all times. In France, this balancing was historically solely supplied by EDF. Recent legislative changes have opened balancing supplies, thus creating competition. RTE, the electricity transmission system operator, has developed, in consultation with the main market players, the balancing mechanism. This enables available capacities to be merged in order to guarantee this balance. It operates like a permanent bidding system open to producers, industrial consumers and foreign players. Bids submitted by players are selected by RTE depending on the system requirements, taking into account merit order criterion and technical constraints. Prices issued from the balancing mechanism are used to provide a legitimate reference price for the settlement of imbalances between supplies and consumptions of the different electricity market players. Transparency, a crucial element of this mechanism, is ensured by a comprehensive system of open data publication. Since its launch, the balancing mechanism has proven its operational strength. (author)