Order TED/966/2026: new capacity market for the peninsular electricity system

The Ministry for the Ecological Transition and the Demographic Challenge has created a capacity market in the Spanish peninsular electricity system through Order TED/966/2026, of September 15, published in the Official State Gazette (Boletín Oficial del Estado) no. 230 of September 17, 2026 (BOE-A-2026-19329). The regulation, signed by the third vice president of the Government and minister Sara Aagesen Muñoz, will remunerate the availability of firm capacity to ensure supply during system stress situations. It enters into force on September 18, 2026, the day after its publication.

The order develops article 14.5 of Law 24/2013, of December 26, on the Electricity Sector, and complies with Regulation (EU) 2019/943, of June 5, 2019, on the internal market for electricity. Its justification lies in the adequacy analyses, which detect a risk of deficit exceeding the reliability standard of 1.5 hours set by the Resolution of July 7, 2025, of the Directorate General for Energy Policy and Mines:

• National adequacy analysis by Red Eléctrica de España (November 2023): 6.26 expected hours of loss of load expectation (LOLE) in 2025, 4.76 hours in 2027, and 2.34 hours in 2030.
• European ERAA 2024 analysis, prepared by ENTSO-e and approved by ACER: 5 hours in 2025 and 4.5 hours in 2028.
• National analysis of October 2025: 4.08 hours in 2028 and 2.41 hours in 2030.

The text attributes the problem to the “missing money” phenomenon, which prevents new investments in firm and flexible technologies from being viable despite the increase in arbitrage revenues. As context, the preamble estimates installed wind capacity at over 33 GW and photovoltaic capacity at over 41 GW in 2025, compared to approximately 9 GW in 2019—an increase of over 360%; renewables contributed 56.8% of electricity production in 2024.

Three auction modalities

The market is centralized, peninsular in scope, and based on the firm capacity needs identified at a single node by the system operator. The competitive bidding is structured into three models:

• Main auction: contracts firmness needs; the provision period begins at most five years after allocation, extendable to nine years for a new investment quota.
• Adjustment auctions: annual, with a twelve-month provision, for unforeseen adequacy deviations.
• Transitional auctions: annual and simultaneous, provided for in the sole transitional provision until the start of the first provision period of the main auction.

Provision periods are set by technology: twelve months for existing generation and storage facilities, half of the useful life with a maximum of fifteen years for new investments, and between one and ten years for demand facilities. Awards are resolved via sealed bid with a “pay-as-bid” type of settlement, and a secondary market for the assignment and transfer of rights is foreseen.

Participants, firmness, and remuneration

Electric energy producers, storage owners, final consumers, demand aggregators—including marketers—and production and storage aggregators may participate. The order also applies to Red Eléctrica de España, SA, as the system operator, and to the National Commission on Markets and Competition.

To preserve technological neutrality, firmness coefficients will be applied, with values between 0 and 1, which compare the actual contribution of each technology. Calls for tenders may set a maximum price for the firm capacity curve and a lower reserve price for existing facilities, on a confidential basis, in addition to a maximum CO2 emissions threshold. Awardees will receive a fixed monthly remuneration equal to one-twelfth of the product of the awarded firm capacity by the auction price, in euros per firm MW per year.

Financing and cost control

The annual cost of the service will be financed by electric energy marketers, including reference marketers for Spanish internal consumption, and by direct market consumers, through unit prices differentiated by tariff segments and time periods. These prices will be updated each fiscal year by order of the head of the ministry, following agreement by the Government’s Delegated Commission for Economic Affairs.

The ministry will annually present information to that body regarding the awarded capacity, the effective cost borne by consumers, the impact on the rest of the components of the final electricity price—following a report from the National Commission on Markets and Competition—the degree of competition, and the contribution to security of supply.

Non-compliance and entry into force

The system operator will verify availability and may conduct tests at least once a year. Failing the first test results in the loss of a monthly remuneration increased by 20%; the second, a quarter; and the third, the annual remuneration plus 20% and the disqualification of the facility. Correction coefficients for non-compliance are set at 1.2. Stress hours may not exceed 10% of the hours of a calendar year.

The regulation was reported by the National Markets and Competition Commission on July 27, 2021, and authorized by the Government’s Delegated Commission for Economic Affairs on September 14, 2026. Facilities in border offer zones may participate once the coordination agreements provided for in Regulation (EU) 2019/943 are approved.

The capacity market introduces a new remunerative component that will appear on consumers’ electricity bills and, for the first time, pays generators, storage, and demand for being available during critical hours. Its design will condition investments in backup and flexibility over the next decade and the fulfillment of the PNIEC objectives.

Source: Official State Gazette, no. 230, September 17, 2026, Sec. I. General provisions, page 122656 (official reference: BOE-A-2026-19329).