CISAF: Commission approves Czech capacity mechanism
The measures aims to ensure there is sufficient capacity to produce or store electricity, or to reduce electricity consumption so that production meets demand in the long term. It is the first capacity mechanism approved under the Clean Industrial Deal State Aid Framework (CISAF) adopted by the Commission on 25 June 2025.
The mechanism seeks to ensure that security of supply is maintained at the lowest possible cost, while supporting the integration of cleaner and more flexible resources into the electricity system. The measure is designed as a market-wide capacity mechanism, which compensates parties that make capacity available during periods of scarcity. These parties include existing and new generation assets, storage and cross-border capacity. There is also a possibility for demand-side response, where consumers get remunerated to lower their consumption in response to reduced electricity supply. The participating units comply with the applicable CO2 emission limits set out in EU legislation. Aid will be granted through competitive bidding processes. The capacity mechanism will be financed through consumer charges, with an estimated overall budget ranging from EUR 3.1 billion to EUR 6.2 billion. The measure will run for 10 years as of July 2026, with contracts for a maximum of 15 years.
The Commission found that the mechanism meets all requirements set out in Annex I of the CISAF, namely that it is necessary, appropriate, proportionate and has a limited impact on competition and trade between Member States.
For more information, see its specific PR.