The division of the common German-Austrian electricity market from a legal perspective

In its decision No 06/2016, the Agency for the Cooperation of Energy Regulators (ACER) ordered a split of the joint German-Austrian electricity market. Since the introduction of a bidding zone border and capacity allocation would have significant negative effects on the Austrian economy the decision meets strong opposition from Austrian policymakers and market participants. The following paper depicts the legal and factual background of the decision and assesses whether ACER enacted its decision in compliance with EU law.