Balancing
Balancing has two closely linked sides: the procurement of reserves through Europe’s auctions and PICASSO platforms, and imbalance pricing, whose methodology sets the key real-time signal for flexibility and governs how balancing groups self-balance. As wind and solar generation grow, both are gaining weight.
We advise transmission system operators and regulators in Germany, Belgium, and Switzerland on balancing markets, imbalance pricing, and balance group management — through studies, expert reports, and courses. For Swissgrid, we developed a new imbalance pricing regime from first principles.
Anselm Eicke is our balancing lead.
Dr. Anselm Eicke
eicke@neon.energy
+49 176 56 755 674
SFOE
2025
multi client
2023
multi client
2021
BMWi
2021
Electricity Markets (EN) An in-depth overview of how electricity markets function in practice, combining economic theory, regulation, and industry experience: from price formation and day-ahead auctions to balancing and capacity markets. Designed for professionals who trade, regulate, analyze, or design electricity markets across the power sector.
Swiss–EU agreement (Swissgrid). Switzerland and the EU have proposed an agreement to integrate their electricity markets more deeply. In this Consentec-led study, we assess what it would mean for system security, market efficiency, and regulation, giving Swissgrid a fact-based foundation for the debate. The work centers on balancing market integration. Ongoing.
Management premium (SFOE). Switzerland’s move to a single-price imbalance settlement in 2026 requires updating the management fee methodology for renewables. For the Swiss Federal Office of Energy, we analyzed the current approach and developed a transparent formula reflecting balancing costs under the new market design. 2025. Report.
Balancing energy auctions (ElCom). Since the introduction of the PICASSO-compatible bidding process, Switzerland has seen a sharp increase in balancing prices. For the Swiss regulator ElCom, with Takon and ZEW, we analyzed the causes of the price rise, evaluated the current market design, and developed concrete proposals to improve the Swiss balancing market. 2025.
Settlement price (utility). Several European countries are moving toward more liberal imbalance settlement rules and introducing a symmetric imbalance settlement price. Against this background, we supported a utility in updating its trading and investment strategies. 2024.
Scheduling process (TSOs). Market parties have to submit a schedule to their connecting TSO, forecasting generation and consumption. However, they often have an incentive to submit a biased forecast. For the German TSOs, we evaluated options to improve schedule accuracy, building on lessons learned from other countries. 2024–25.
Imbalance settlement price (Swissgrid). Concerned about large system imbalances, Switzerland has decided to reform its imbalance settlement price. For the Swiss TSO, we provided a quantitative assessment of the proposed system and developed a new pricing regime, derived from first principles and informed by the real-world experience of other countries. 2024.
Ancillary services (battery developer). Battery projects eye ancillary services as sources of revenue, including upcoming markets such as reactive power and synthetic inertia. We provided an assessment of ancillary services markets and ad hoc input to business case development for a European battery project developer. 2024.
Real-time price (Elia). Belgian TSO Elia worked on reforming its imbalance settlement price in the context of PICASSO. As part of a review committee, we provided input and assessments and supported external communication. 2023–24.
Passive balancing (multi client). Market parties bet on the imbalance settlement price, thereby helping to balance the system — arguably one reason Germany’s balancing reserve demand halved while wind and solar capacity quintupled. This study, commissioned by a group of market parties, explains the mechanisms and addresses concerns about this kind of “passive balancing.” 2023. Report.
Intraday / balancing (TSO). Balancing activation may leak into intraday prices. For a German TSO, we econometrically identified the link between intraday prices and balancing activation, based on millions of individual transactions, and found a strong correlation, a possible sign of insider trading. 2023.
Imbalance settlement pricing (Elia). As Belgium prepared to join the European balancing platform PICASSO, its imbalance settlement price had to be redesigned. We supported Belgian TSO Elia in developing a new pricing scheme and in the related discussions with the regulator CREG. 2022.
Eicke et al. (2021): Electricity balancing as a market equilibrium
Koch & Hirth (2019): Short-term electricity trading for system balancing
Hirth & Ziegenhagen (2015): Balancing power and variable renewables
Lorenz et al. (2014): Inefficiencies on the German balancing market