Capacity Market Support & Trading in Ireland

Specialist support across capacity market participation, trading, revenue strategy, and regulatory requirements for energy assets navigating Ireland’s evolving electricity market.

Supporting Energy Assets With Effective Capacity Market Strategies

The Capacity Remuneration Mechanism is a core feature of the Single Electricity Market (SEM), designed to safeguard the security of electricity supply across the island of Ireland. For eligible capacity providers, it can also represent an important source of contracted revenue.

However, the commercial opportunity needs to be considered alongside the complexity of participation. The capacity market involves qualification, detailed auction rules, de-rated capacity, contractual obligations, and ongoing requirements after an award has been secured.

For asset developers, generators, and battery storage projects, capacity market participation in Ireland can therefore form part of a wider route-to-market and revenue strategy. Captured Carbon already works with energy assets across wind, solar, battery storage, thermal, and biogas/biomethane markets, with services spanning route-to-market strategy, electricity trading, revenue optimisation and capacity market support.

Common Challenges in Capacity Market Participation

Different assets can have different routes into the capacity market, depending on their characteristics and the applicable rules. Understanding whether a project can participate is an important first step.

Capacity market participation involves a detailed qualification process governed by the Capacity Market Code. Captured Carbon notes that the auction process is complicated and lengthy and requires a strong understanding of the Code and relationships with the Market and System Operators and Regulatory Authorities.

The capacity an asset can offer is not necessarily the same as its installed capacity. The capacity market uses de-rating to account for differences in the reliability and availability characteristics of different capacity types.

The current CRM uses T-4 auctions, with additional auctions such as T-1 available closer to the relevant Capacity Year where required. Understanding the timing and requirements of the relevant auction is important when planning participation.

Securing an award creates ongoing responsibilities. Participants need to understand the requirements attached to awarded capacity and how those obligations affect the operation and commercial position of the asset.

Capacity revenue should not automatically be viewed in isolation. For assets such as batteries, Captured Carbon already considers capacity alongside wholesale, balancing and ancillary-service revenues as part of its broader revenue optimisation approach.

How Captured Carbon Supports Capacity Market Participation

Captured Carbon’s role is grounded in supporting projects through the Capacity Market process while bringing wider electricity-market and regulatory knowledge to the commercial decision-making around participation.

Understanding where capacity market participation fits within the wider commercial strategy of an energy asset is an important part of the process.

Captured Carbon supports projects through the Capacity Market process, drawing on its understanding of the Capacity Market Code, market participants and the wider regulatory environment.

The company can help clients navigate the complexity surrounding capacity market auctions and assess the commercial considerations associated with participation.

Capacity Market Services for Energy Assets and Businesses

Capacity Market Support

Guidance and participation support for projects navigating the Capacity Market process and its associated requirements.

Capacity Market Participation for Corporate Energy Users

Support for corporate energy users exploring Capacity Market participation and potential additional value from relevant assets or flexibility.

Revenue Optimisation

For battery storage and other assets with multiple revenue opportunities, Capacity Market participation can be assessed alongside wholesale, balancing and ancillary services.

Electricity Trading

Captured Carbon’s wider electricity trading expertise provides market context when assessing the commercial position of an energy asset. Its trading activities span the Irish market.

What Influences Capacity Market Participation and Revenue?

Industries We Support

T-4 and T-1 Auctions

Capacity auctions are held four years before the relevant capacity year, with additional auctions such as T-1 used closer to delivery where required. The proposed CRM 2.0 design is currently being developed, with the SEM Committee consulting on a T-5 main auction and T-1 top-up structure for the future mechanism.

De-Rated Capacity

De-rating reflects the characteristics of different capacity technologies and affects how much capacity can be recognised within the market. This makes accurate understanding of an asset's de-rated position important when assessing participation.

Technology and Asset Characteristics

A battery, generator, renewable asset or flexible resource will not necessarily have the same capacity market characteristics. The technical profile of the asset needs to be considered alongside the applicable market requirements.

Auction Outcomes

Capacity market revenue is influenced by auction outcomes and the applicable capacity payment arrangements. Commercial assessment therefore needs to consider both potential revenue and the obligations associated with an award.

The Evolving CRM Framework

The capacity market is entering an important period of development. The SEM Committee is now considering areas including delivery timeframes, availability incentives, de-rating factors, cost recovery, decarbonisation and flexibility integration.

Why Choose Captured Carbon for Capacity Market Support?

Captured Carbon has extensive experience supporting projects through the Capacity Market process and understands the regulatory and commercial considerations involved.

Captured Carbon became the first Capacity Trade Broker within I-SEM in 2023, giving it a distinctive position within the Irish energy-market landscape.

Captured Carbon states that it has advised clients on securing Capacity Market contracts worth more than €750 million. This is a significant indicator of its experience with the market.

Capacity market decisions often sit alongside wider questions around route to market, electricity trading and revenue optimisation. Captured Carbon works across these areas rather than treating capacity as an isolated market mechanism.

Captured Carbon positions itself at the intersection of trading, regulation and strategy. That broader perspective allows capacity market opportunities to be considered within the commercial reality of the asset or business.

Our Process for Capacity Market Clients

We start by understanding the asset, technology, development stage, capacity and commercial objectives.

We consider the relevant capacity market arrangements and how participation may fit within the asset’s wider commercial strategy.

We support the project through the applicable Capacity Market process, taking account of the Capacity Market Code and relevant regulatory requirements.

Capacity market participation is assessed alongside the wider revenue and trading opportunities available to the asset.

Contact Us

Get in touch for a consultation or energy review:

Frequently Asked Questions

Q: What is the Capacity Remuneration Mechanism?

A: The Capacity Remuneration Mechanism, or CRM, is the framework through which capacity is procured and remunerated within the Single Electricity Market.

Q: What is a T-4 Capacity Auction?

A: A T-4 auction takes place four years before the relevant Capacity Year under the current CRM framework. Additional auction arrangements can operate closer to delivery.

Q: What is a T-1 Capacity Auction?

A: A T-1 auction takes place closer to the relevant Capacity Year and can provide an additional opportunity to procure incremental capacity where required.

Q: Can battery storage participate in the Capacity Market?

A: Eligible battery storage projects can participate in the Capacity Market, subject to the applicable requirements. Captured Carbon specifically identifies capacity market participation as part of its battery revenue optimisation offering.

Q: Can capacity market revenue be combined with other energy-market revenues?

A: Potentially, subject to the applicable market rules and the characteristics of the asset. Captured Carbon specifically considers capacity alongside wholesale, balancing and ancillary-service revenues for battery storage projects.