{"id":267139,"date":"2026-11-02T09:21:44","date_gmt":"2026-11-02T08:21:44","guid":{"rendered":"https:\/\/www.memo.mk\/?p=267139"},"modified":"2026-11-02T09:28:28","modified_gmt":"2026-11-02T08:28:28","slug":"comparative-analysis-of-the-day-ahead-market-before-and-during-the-early-stages-of-cbam-in-the-republic-of-north-macedonia","status":"publish","type":"post","link":"https:\/\/www.memo.mk\/?p=267139","title":{"rendered":"Comparative Analysis of the Day-Ahead Market: Before and During the Early Stages of CBAM in the Republic of North Macedonia"},"content":{"rendered":"\n
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By: Stojana Megan Milosevska, Energy Markets Specialist
National Electricity Market Operator \u2013 MEMO LLC<\/strong> Skopje<\/strong><\/p>\n\n\n\n

1.  INTRODUCTION<\/h1>\n\n\n\n

Europe’s energy transition, driven by the European Green Deal and the goal of achieving climate neutrality by 2050, has led to the introduction of new regulatory mechanisms aimed at reducing greenhouse gas emissions and strengthening the competitiveness of the low-carbon economy[1]. In this context, the European Union introduced the Carbon Border Adjustment Mechanism, whose main objective is to prevent carbon leakage by establishing equal carbon costs for domestic producers and importers of products from third countries.<\/p>\n\n\n\n

Although CBAM is still in its initial phase, its direct impact on the electricity sector can already be observed through changes in production costs, competitiveness and cross-border electricity trading. Under these conditions, the organised electricity market, particularly the day-ahead market segment, plays a key role, as the formation of reference market prices and the efficient allocation of electricity provide indicators for the further development of the economy.<\/p>\n\n\n\n

Prices formed on the day-ahead market represent a reference indicator for Market Participants, as they reflect expectations regarding the relationship between supply and demand, the availability of generation capacities, energy prices and cross-border electricity flows.  In addition, they provide a basis for the functioning of other segments of the electricity market, as well as for making trading and investment decisions.<\/p>\n\n\n\n

2.  ANALYSIS OF MARKET INDICATORS OF THE DAY-AHEAD MARKET<\/h1>\n\n\n\n

To obtain a comprehensive overview of the state of the electricity market, the analysis is based on several market indicators covering the main characteristics and changes in market behaviour.  Since the electricity market is influenced by multiple factors, such as demand, supply, renewable generation, market liquidity and the conditions in neighbouring systems, a single indicator is not sufficient for a comprehensive assessment of its functioning.  Therefore, the analysis uses indicators covering different aspects of the market, such as price levels and volatility, market liquidity, differences between prices during peak and off-peak hours, and the impact of renewable energy generation.<\/p>\n\n\n\n

The combined assessment of these indicators provides a better understanding of market conditions and helps identify periods of increased price uncertainty, changes in liquidity, unusual price movements and differences in market behaviour across different periods. In this way, the analysis of the selected indicators is used to assess the development and stability of the electricity market, as well as to identify the main factors that may affect its performance during the period under review.<\/p>\n\n\n\n

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  • Price Volatility Index<\/strong><\/li>\n<\/ul>\n\n\n\n

    For the purposes of the analysis, the price volatility values are obtained according to the following formula and they represent the degree of deviation of the hourly electricity prices from their average value in the analysed period:<\/p>\n\n\n\n

    \u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0<\/em><\/strong><\/p>\n\n\n\n

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             <\/em><\/strong> \u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 (1)<\/em><\/strong><\/p>\n\n\n\n

                                     <\/em><\/strong><\/p>\n\n\n\n

    Price Volatility \u2013 price volatility for the period under review;<\/p>\n\n\n\n

    Price \u2013 price for the period under review;<\/p>\n\n\n\n

    Average price – average price for the period under review:<\/p>\n\n\n\n

    Number of Hours \u2013 number of hours.<\/p>\n\n\n\n

    Accordingly, based on the result obtained, prices may be classified as having high, normal or low volatility.   Higher price volatility values indicate increased price fluctuations and potential short-term imbalances between electricity supply and demand. Conversely, lower volatility values are associated with greater stability, more uniform price movements and more efficient matching of Market Participants.<\/p>\n\n\n\n

    In European practice, a higher incidence of periods of high volatility is most commonly associated with a greater share of variable renewable energy sources, constraints on cross-border transmission capacities and short-term market imbalances.  Hence, the analysis of price volatility is an important indicator for assessing market stability, liquidity and the ability of the market to respond to external shocks and changes in market conditions.<\/p>\n\n\n\n

    According to the results obtained for price volatility for the 2024\u20132026 period, the high-volatility category was present in all three years, accounting for 63.70% in 2024, 66.46% in 2025 and 59.70% in 2026.  Such representation indicates that market prices have often been influenced by factors that cause pronounced market fluctuations. The high volatility is a feature of a young market that is in the development phase, so it can be noted that the volatility for 2026 compared to 2024 is significantly reduced, and thus the price distortion itself is reduced.<\/p>\n\n\n\n

    Table 1.  Average price volatility<\/strong><\/p>\n\n\n\n

    Volatility level<\/strong><\/td> Average price volatility<\/strong><\/td><\/tr>
    2024<\/strong><\/td>2025<\/strong><\/td>2026<\/strong><\/td><\/tr>
    High volatility<\/td>63.7%<\/td>66.46%<\/td>59.70%<\/td><\/tr>
    Normal volatility<\/td>23.12%<\/td>33.54%<\/td>25.89%<\/td><\/tr>
    Low volatility<\/td>13.18%<\/td>\u0425<\/td>14.42%<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n

     <\/h1>\n\n\n\n