# Economic analysis

The “degree of capacity allocation” is to be used for an economic analysis of the offering levels requested. By using the degree of capacity allocation, the basic objective of the transmission system operators is to largely secure the investment measures in first-time marketing. The degree of capacity allocation is a threshold for enabling a transparent decision on the capacity booking as of which an offering level is regarded as having been marketed successfully (positive result) and so achieved. The degree of capacity allocation is determined by the respective transmission system operator individually for each network point and offering level. The reservation quotas for short-term marketing to be taken into account are included in calculating the degree of capacity allocation.

The degree of capacity allocation will be used after the capacity auction in March 2017. A comparison is conducted for each offering level to see whether the ratio from the total annual capacity booked for each year and from the total annual capacity offered by the TSO for each year is greater than the degree of capacity allocation defined for the offering level in question. If the degree of capacity allocation is reached or exceeded, the economic analysis of the offering level is positive. If the degree of capacity allocation for the offering level is not reached, the result of the economic analysis is negative.

The following and figure 2 explains use of the degree of capacity allocation by way of example.

Assuming a required degree of capacity allocation of 65% for this example, the economic analysis would give a negative result.

Assuming a required degree of capacity allocation of 55%, the economic analysis would give a positive result.