EU congestion costs hit €5.4bn as the 70% cross-border rule lags

The last deadline for Europe's grid operators to offer at least 70% of their transmission capacity to cross-border trade passed on December 31, 2025, when the phase-in under national action plans ended. The 2026 market integration report from ACER, the EU agency for energy regulators, published November 4, 2026, finds that in 2025 most of them could not consistently uphold that minimum. Meanwhile the cost of managing grid congestion rose to €5.4 billion in 2025 from €4.3 billion in 2024. Cross-border trade in the day-ahead market alone generates about €32 billion a year in economic surplus, ACER says.

Implementation delays left about €700 million of surplus unrealised in 2025 alone, ACER estimates, and about €8 billion between 2020 and 2025. The figure comes from its assessment of 13 market integration projects: those fully or partly in place produced about €3 billion of surplus in 2025, and the ones not yet fully running would have added about €4 billion had they been operating that year. The agency treats the total of about €7 billion as a lower bound, because it covers only those 13 projects. The €32 billion figure is the gap between Europe's coupled markets and a hypothetical Europe of isolated ones, as estimated by grid operators and power exchanges.

A floor most operators were not yet standing on

Europe prices power by bidding zone, and the zones are still mainly drawn along political borders. Inside a zone, trades are settled without regard to the congestion they cause on the wires; trades between zones get the transmission capacity left over once internal exchanges are accommodated. Regulation (EU) 2019/943 answered that with a floor. Grid operators may not cut interconnection capacity to solve congestion inside their own bidding zone, and they comply by offering at least 70% of capacity to cross-zonal trade, measured on each critical network element on flow-based borders and on transmission capacity after contingencies elsewhere. Countries with structural congestion could phase in under action plans, but the regulation set December 31, 2025 as the date the minimum had to be reached.

In the Core region of central Europe, the floor bound few of its operators in 2025: only the transmission operators of Czechia, France and Slovenia were legally bound by the 70% minimum; all the others worked under approved derogations or action plans, and ACER says even the three bound ones did not always uphold it. Austria, Belgium, the Netherlands and Poland requested derogations for loop flows, power from trades inside neighbouring zones that wanders through their networks, and ACER finds these can substantially reduce capacity commitments, particularly in Austria, Poland and the Netherlands. The regulation limits derogations to a year at a time, or two if the derogation shrinks significantly after the first year, and ACER describes their approval in the Core region as a yearly recurrence.

With the action plans expired at the end of 2025, 70% is now the generally applicable requirement. The Nordic region never had derogations or action plans, so the rule already applied in full there in 2025, and Nordic operators still did not consistently make 70% available on every critical element.

The floor also stops at the day-ahead market. The minimum secured day-ahead is not maintained in later timeframes, ACER says, just as trading moves closer to delivery. Fifteen-minute products, introduced on October 1, 2025 and suited to solar's daily ramps, already account for around 88% of day-ahead volumes. On the borders where cross-border intraday trading runs to 30 minutes before delivery, around a fifth of cross-zonal intraday trading happens in the final hour. Capping cross-border intraday capacity while internal trades run on, ACER writes, "may give internal exchanges de facto priority access to scarce network capacity, which is precisely the type of discrimination that the 70% requirement is intended to address."

The congestion bill

When the market result does not fit the wires, transmission operators pay generators to move. Those costly remedial actions, such as redispatching and countertrading, reached 70 TWh in 2025 at a cost of €5.4 billion, the highest volume and cost in ACER's series. Changes in grid topology and phase-shifting transformers carry no direct operating cost and are generally used first; topology changes are the same tool FERC let SPP formalize in August 2026.

The reasons for redispatch are changing. The share triggered by voltage limits, rather than thermal overloads, rose from 10% in 2022 to 33% in 2025, especially in Spain and Portugal after the Iberian blackout of April 28, 2025. In Spain and Ireland, congestion management costs are equivalent to as much as 17% of the average day-ahead price. Spain curtailed 3.1% of its renewable generation for grid congestion in 2025, roughly double its 2024 rate, while Germany's rate of 2.46% was down on the year.

The 70% rule adds to that bill. ACER expects that offering more capacity across borders, absent other structural measures such as grid reinforcement or new bidding zones, may mean more remedial actions, and it says most operators already rely on them to comply. What keeps several from offering more, it adds, is the lack of coordinated congestion management and of a mechanism that allocates costs to the operators whose flows cause the congestion.

The structural fix was on the table. On April 28, 2025, the day of the Iberian blackout, Europe's transmission operators delivered a bidding zone review recommending that Germany be split into five zones and the Netherlands into two. The member states concerned decided to keep their current configuration, and ACER told the Council of the EU that the benefits of the split had likely been underestimated.

Balancing markets show what integration does once it happens: on PICASSO, the shared platform for automatic frequency restoration reserves that operators from 17 member states had joined by the end of 2025, the annualised duration of extreme price events was 95% lower in 2026 than in 2024.

Outlook

2026 is the first year in which 70% is the general rule rather than a destination, but if Core regulators keep approving loop-flow derogations each year, as ACER describes, measured compliance is likely to move more slowly than the legal text implies. On cost, ACER expects congestion management needs to keep growing as renewables connect faster than grids are reinforced, and the Joint Research Centre forecast it charts puts remedial action volumes at 265 TWh in 2030, against 70 TWh in 2025. Without the coordinated cost-sharing ACER asks for, a congestion bill above 2025's €5.4 billion looks more likely than a smaller one.