“C” is for capacity

Electricity production capacity is defined as the set of resources that can ensure that electricity demand is met at all times.

The resources can be:

1. generation resources:everything that allows the production of electricity, by, for example, the use of traditional fuels such as coal or gas (conventional sources), or by the use of renewable sources such as wind and sun;

2. flexible demand resources:a group of domestic and/or industrial users to modify easily their electricity demand, for instance, reducing it, at Terna's request, in the event of a generation resources shortage;

3. storage resources, such as batteries, which are able to conserve the energy produced for more or less long periods of time, in order to use it when it is actually needed.

In the Italian capacity market ('system for rewarding the availability of electricity generation capacity'), the availability of generation capacity is measured by the Capacity Available in Probability (CDP), an indicator that provide the share of electricity demand reliably satisfied each resource.

In particular, for each year of interest and for each area of the transmission grid, Terna, on the basis of complex simulations, evaluate the CDP demand curves for the auctions of the capacity market, which express the CDP value associated with certain levels of production capacity availability.