RTE and TERNA to split France-Italy annual capacity auctions into A+1/A+2 early products for delivery years 2027-2028

RTE and TERNA announced that annual cross-border capacity auctions at the France-Italy interconnection will be split into early auction products: an A+1 early auction for delivery year 2027 (September/October 2026) and, for the first time, a three-way split including an A+2 early auction for delivery year 2028 (December 2026). All annual products will for the first time be offered exclusively as Financial Transmission Rights – Options.

This changes the forward capacity allocation methodology at a major EU interconnector, extending the forward hedging horizon for market participants and standardizing the product type to FTR-Options only, which affects how traders and utilities hedge cross-zonal price risk between France and Italy well ahead of delivery.

The move builds on a successful 2025 split of annual auctions and extends the early-auction concept further out (A+2), following a pattern seen elsewhere in EU interconnector capacity allocation (e.g., long-term transmission rights reform). Standardizing exclusively on FTR-Options removes Physical Transmission Rights or FTR-Obligation alternatives, simplifying the product suite but potentially altering risk allocation and liquidity distribution between early and standard annual auctions. The phased rollout (2027 two-way split, 2028 three-way split) suggests an incremental design evolution likely coordinated with JAO and subject to further technical detail releases.

EU cross-border capacity allocation framework (CACM Guideline) coordinated bilaterally by RTE and TERNA and administered via JAO

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