The Order is formalised in the BOE that establishes the general framework for centralised capacity auctions, through which eligible resources will be remunerated in exchange for providing firm capacity availability to the system.
The next key milestone will be the publication of the auction calls, which will define the specific parameters of each auction, including the calendar, the products to be contracted, the delivery periods, the firmness coefficients, the guarantee requirements, and other implementation details. These resolutions will also be subject to public consultation and a report from the CNMC before their approval. The start of service provision is unlikely to occur before the first quarter of 2027.
Overall, this is a significant and long-awaited regulatory milestone that opens a pathway for firm and flexible technologies to receive capacity payments, strengthening the security of supply as the penetration of renewables increases. In particular, the mechanism should provide an additional source of income for assets such as gas combined cycle power plants and hydroelectric facilities, which play a key role in providing system flexibility and backup capacity.
Valuation:
Pending the official details, we consider the news positive for integrated companies (Iberdrola, Naturgy, and Endesa), although the impact should not be very significant at this time.