ACM opens door for Non-Firm ATOs (NFA 1.0)
The Consumer & Market Authority (ACM) is giving grid operators the green light to offer contracts without firm transmission capacity, better known as Non-Firm ATOs (NFAs). An NFA allows connected parties such as companies, battery systems and electrolysers to receive discounts on grid tariffs in exchange for a reduction in their deployment. This allows it to be applied to systems that are not constantly using their full capacity.
Use as needed
Until now, grid operators could only offer fixed transmission agreements, meaning that customers could use their right to transmission capacity at any time of the day. With the introduction of an NFA, grid operators hope to relieve the electricity grid at peak times, while filling more of the off-peak hours. Offering a connection only when there is sufficient transmission capacity aims to combat grid congestion.
Fundability key concern
There are critical voices from the market about this first proposal for an NFA, also known as "NFA 1.0. In many cases, the current model does not provide sufficient security to fund projects. This is due to the proposed limitation, which can put pressure on a system's revenues, and the amount of the rebate that comes in return. According to Energy Storage NL, a workable contract is needed with more guarantees about the transport capacity and an adequate discount via the grid tariffs. This is being worked on within the National Action Program on Grid Congestion, including with the ATR85 proposal for time-based rates and in our discussions with the regional grid operators.
Voluntariness remains conditional
Grid operators will have the option to offer contracts without firm transmission capacity in areas of grid congestion from Feb. 1, 2024. From Feb. 1, 2025, offering an NFA in congested areas will become mandatory. Energy Storage NL stresses that entering into a limiting contract should always remain voluntary and points to the grid operators' legal duty to provide a connection for the market.
Read the ACM's news release here.
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