A multilateral market coupling approach for the allocation of cross border transmission capacity

The problem of cross border interchange and of exchange capacity allocation has gained an increasing importance because of existing price gaps between the different countries and of limited exchange capacity. The European Transmission System Operators (ETSO) committee has issued a sequence of documents illustrating the guidelines for efficient and economic assignment of the available cross border capacity. An example of successful multi-market coordination is given by the trilateral market coupling system developed by the TSOs of France, Belgium and the Netherlands. The aim of the present paper is that of finding a procedure able to make results from market coupling as close as possible to those furnished by single electricity pool.