Europe’s electricity system is undergoing rapid transformation, driven by large-scale renewable integration, evolving market design, and growing cross-border interconnection. These changes are increasing both the complexity and importance of long-term system planning. ENTSO-E, the European Network of Transmission System Operators for Electricity, coordinates this effort across a power system serving more than 500 million people and spanning approximately 480,000 kilometers of transmission infrastructure.
As Europe’s markets become more interconnected, ensuring security of supply requires adequacy assessments that reflect both market dynamics and the physical behavior of the transmission network. Increasing reliance on variable renewable generation, persistent national bidding zones, and ambitious decarbonization targets introduce uncertainty about whether sufficient generation and transmission capacity will be available in future years. Cross-border dependencies mean that adequacy can no longer be assessed solely at the national level; system risks must be evaluated within a continental context.
To address these challenges, ENTSO-E conducts the European Resource Adequacy Assessment (ERAA), a pan-European, forward-looking analysis covering a ten-year horizon. The ERAA provides decision-makers with consistent indicators of supply risk, such as Loss of Load Expectation (LOLE) and Energy Not Served (ENS), which are used to inform capacity mechanisms, investment decisions, and regulatory oversight across Europe. Delivering these indicators credibly requires an integrated modeling framework capable of representing market behavior, physical constraints, and uncertainty in a unified structure.
Historically, cross-border electricity exchanges were modeled using net transfer capacity (NTC), under which transmission system operators agreed bilateral exchange limits between neighboring bidding zones. While straightforward to implement, this approach is inherently conservative and does not fully reflect the behavior of a highly meshed transmission network, where injections in one zone can influence constraints far beyond adjacent borders.
As cross-border interdependence increased, ENTSO-E identified the need for a network representation that more accurately captures physical system behavior while remaining computationally tractable for long-term adequacy studies. This led to the adoption of a flow-based methodology as the foundation for pan-European adequacy assessment.
Rather than defining fixed bilateral limits, flow-based modeling represents how changes in zonal net positions affect flows on critical network elements using simplified DC power flow principles. Power transfer distribution factors (PTDFs) quantify the sensitivity of network elements to zonal injections and withdrawals; while remaining available margin (RAM) defines the capacity available for market exchanges after accounting for operational security constraints. This approach enables a more realistic representation of cross-border trade and congestion patterns within adequacy simulations.
The ERAA framework integrates multiple data streams into a single, consistent modeling dataset. National transmission system operators provide their best estimates of future system development, including expected generation portfolios, demand evolution, storage deployment, and planned infrastructure investments. These inputs form the basis of a pan-European market model that captures both structural trends and interconnection effects.
Uncertainty is addressed explicitly within the assessment. Weather and climate variability are represented through multiple climate-adjusted weather years, ensuring that adequacy outcomes are not driven by a single historical pattern. Thermal forced outages and operational variability are incorporated to reflect real-world system performance.
Economic assumptions are also reviewed. The ERAA gives more insights on the economic viability of generation assets based on a diligent and transparent methodology, evaluating whether units are likely to remain operational over the assessment horizon under projected market conditions. This ensures that adequacy indicators form a genuine risk assessment based on both technical and economic considerations.
The outcome of this integrated process is a robust set of adequacy indicators quantifying the risk of supply shortfalls across countries, scenarios, and time horizons.
To deliver the ERAA, ENTSO-E applies several modeling tools. Recent ERAA editions took Energy Exemplar’s PLEXOS® platform as its reference modeling environment.
Within the ERAA framework, PLEXOS® enables the coupling of long-term economic assessment with detailed chronological market simulation. The platform optimizes dispatch and cross-border exchanges subject to generation constraints, fuel costs, emissions pricing, and transmission limits, while simultaneously evaluating generator profitability and asset retention over time.
Its capabilities support:
By integrating capacity assessment and operational simulation, PLEXOS® allows ENTSO-E to capture both structural adequacy risks and potential short-term stress events within the same framework. This consistency is critical for ensuring that adequacy metrics such as LOLE and ENS reflect realistic market and system behavior.
ENTSO-E uses, among others, PLEXOS® to implement flow-based network constraints directly within long-term adequacy simulations. Detailed nodal network physics are first derived from load-flow analysis. Nodal PTDFs are then aggregated into zonal PTDFs using generation shift keys, translating detailed network behavior into a tractable zonal representation suitable for large-scale stochastic simulation.
To manage computational complexity across thousands of simulation hours and multiple scenarios, representative flow-based domains—such as summer and winter system conditions—are identified and clustered. Each simulation hour is mapped to an appropriate domain, allowing realistic constraint patterns to be applied without requiring full nodal resolution in every time step.
Within PLEXOS®, flow-based constraints are implemented as linear relationships linking zonal net positions, cross-border exchanges, and HVDC flows. Time-slice functionality enables domain-specific constraints to be activated automatically, embedding physical network behavior directly into long-term market optimization while maintaining computational efficiency.
The ERAA framework delivers a transparent and consistent assessment of Europe’s future resource adequacy. Results quantify supply risk across countries, scenarios, and time horizons, providing a robust evidence base for capacity mechanisms and broader regulatory processes.
By combining flow-based network representation, economic viability analysis, and stochastic simulation within a single modeling framework, ENTSO-E delivers adequacy insights that reflect both market dynamics and physical system constraints.
By evolving its adequacy assessment methodology and leveraging the advanced capabilities of PLEXOS®, ENTSO-E has strengthened its ability to assess security of supply in an increasingly interconnected European power system, supporting informed, data-driven decision-making as Europe’s energy transition continues.