Competition Law and Negotiated Settlements in Competition Proceedings

1. Introduction

Curtailment transparency and reporting obligations are legal duties requiring electricity-system operators to provide clear information about when, why and how renewable electricity is curtailed. Curtailment occurs when a renewable generator, such as a wind or solar plant, is capable of producing electricity but is required to reduce or stop generation.

These obligations are important in renewable-heavy electricity systems because repeated curtailment can affect generator revenue, electricity prices, investment decisions and public confidence. Transparent reporting helps regulators determine whether curtailment is genuinely necessary or whether better network planning and investment are required.

2. Legal Purpose of Transparency

The main purpose of transparency is to prevent arbitrary or discriminatory curtailment.

A system operator should be able to explain:

why curtailment occurred;

which network constraint caused it;

how much renewable electricity was curtailed;

which generators were affected;

how long curtailment lasted;

what alternatives were considered; and

what measures will prevent similar curtailment in the future.

Under Regulation (EU) 2019/943, redispatching must be based on objective, transparent and non-discriminatory criteria.

3. Reporting Requirements

Article 13 of Regulation 2019/943 contains important reporting requirements concerning redispatching.

Transmission-system operators and distribution-system operators must report information concerning the effectiveness of market-based redispatch, including the reasons for redispatching, volumes involved and measures taken to reduce future downward redispatching of renewable electricity.

The reporting framework can therefore provide information about:

total renewable curtailment;

frequency of curtailment events;

reasons for curtailment;

amount of energy affected;

costs of redispatch;

compensation paid; and

investment or flexibility measures planned.

This information allows regulators to monitor whether operators are meeting their obligations.

4. Transparency of Curtailment Decisions

Transparency should apply not only to annual reports but also to individual curtailment decisions.

When a system operator orders a renewable generator to reduce production, appropriate records should identify:

date and time;

affected generator;

quantity of electricity reduced;

technical reason;

relevant network constraint;

duration;

redispatch method; and

applicable compensation.

Such information creates an audit trail.

An audit trail is particularly important when a generator challenges the decision or claims compensation.

5. Publication of Data

Transparency becomes stronger when relevant information is publicly available.

Public reporting can help:

renewable developers assess grid constraints;

investors understand curtailment risks;

regulators identify congested areas;

researchers analyse renewable integration; and

consumers understand the cost of managing renewable generation.

However, transparency does not mean that every commercially sensitive piece of information must be published. Confidential business information and security-sensitive network information may require protection.

Therefore, the law must balance transparency with commercial confidentiality and electricity-system security.

6. Non-Discrimination

Reporting also helps identify discriminatory treatment.

For example, if two similar renewable projects are connected to the same constrained network but one project is repeatedly curtailed while another is rarely affected, regulators may examine whether there is an objective explanation.

Regulation 2019/943 requires redispatching decisions to follow objective and non-discriminatory criteria. This principle is therefore closely connected with reporting obligations.

7. Transparency and Compensation

Reporting is also important for determining compensation.

If compensation depends upon the quantity of electricity that was curtailed, accurate records are necessary.

For qualifying non-market-based downward redispatch, EU law generally provides financial compensation. The relevant rules can include additional operating costs and net revenues that the facility would otherwise have earned.

Therefore:

Accurate reporting → accurate measurement of curtailment → correct compensation.

8. Regulatory Oversight

Energy regulators use reported information to evaluate system operators.

They may examine:

whether curtailment is increasing;

whether renewable projects are disproportionately affected;

whether network investment is sufficient;

whether market-based redispatch is being properly used;

whether compensation is correctly calculated; and

whether operators are taking measures to reduce future curtailment.

This creates an important accountability mechanism.

9. Relevant Case Laws

TenneT TSO GmbH and TenneT TSO BV v ACER, Case T-482/21

In T-482/21, decided on 25 September 2024, the General Court considered ACER's methodology for allocating the costs of redispatching and countertrading in the European Core electricity region.

The case is relevant because it demonstrates that congestion-management methodologies can have substantial financial effects and therefore require proper legal reasoning and a lawful regulatory framework.

TransnetBW GmbH v ACER, Case T-476/21

In T-476/21, the General Court examined another dispute concerning the allocation of redispatching and countertrading costs.

The case illustrates the importance of clear methodologies, accountability and transparent regulatory decision-making in interconnected electricity markets.

10. Conclusion

Curtailment transparency and reporting obligations are essential for the proper governance of renewable-heavy electricity systems. They ensure that system operators cannot treat curtailment as an unexplained or invisible operational decision.

A strong legal framework should require operators to disclose or report the reasons, volumes, duration and costs of curtailment, together with the measures being taken to reduce future renewable-energy losses.

At the same time, the framework should protect legitimate commercially confidential and security-sensitive information.

Ultimately, transparency supports non-discrimination, correct compensation, regulatory oversight, better grid investment and investor confidence. The EU framework under Regulation 2019/943 provides an important example of how reporting obligations can connect operational decisions with wider legal accountability.