On November 14th, the 2nd SRAD Auction for 2025 took place, a mechanism considered necessary but one that has been used very little so far. SRAD has been activated twice in 2024 (May and July) and once in 2023 (September), with activation periods of approximately 2.25 hours.
At Magnus Commodities, we managed to enter the 2024 auction and have successfully secured participation again for next year. Winning MW in the auction is not for everyone, but neither is it for a select few like the Interruptibility mechanism of previous years; the system is evolving. This is the trend followed by other countries, where auctions (¿) are more dynamic, and prices reflect the system operator’s needs more accurately.
Data of interest
✔️ In 2024, each MW won in the auction provided the participant with €234k, while in 2025, this amount will rise to €246k. The required hours have been reduced from 5,745 to 4,371 (-24%), but the price has increased from €40.82 to €56.43 €/MWh (+38%). This means less demand is required, but participants are paid more for each hour.
✔️ The SRAD cost has increased from €143 million to €283 million, almost doubling in just one year (indicating that mechanisms like this may be gaining more relevance).
2024 vs 2025 Results – Graphs
How to participate in SRAD
Entering the SRAD is not easy, but it is not overly complicated either; it simply requires the ability to reduce demand at a given moment, along with the technical and human resources necessary to achieve this. We are pleased to share our experience of how we have managed to do this over the past two years.
For an industrial client, the ability to be remunerated with €246k per MW is crucial, especially since the industry needs support to stay competitive (see Draghi Report – link).
In recent years, we have made progress in generation, but now it’s time to focus on:
- Demand Growth.
- Transmission and Distribution Networks.
- Capacity/Flexibility Mechanisms for the System. There seems to be a general consensus that Spain is the “Place to Be.”
SRAD is directly aligned with point 3 above, although we see significant room for improvement. In such a regulated sector with substantial inertia, the key is to get started, even if the proposed solution is not the definitive one.
How to win the SRAD auction
At Magnus Commodities, we would be delighted to share our experience and help you prepare so you can be one of the winners of the upcoming auction at the end of the year.
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