Denmark and its neighbours: Flows, spreads and the impact of flow-based coupling

Denmark’s power prices do not move in isolation. Over the past year, shifts in flow-based market coupling, cross-border constraints and rising wind output have reshaped day-ahead and intraday dynamics. This analysis explores how prices, spreads and flows between DK1, Germany and the Netherlands interact and what upcoming changes in CORE could mean for market participants.

March 3rd, 2026

In this article, we will look at the Day-ahead price formations in Denmark in the past year. The correlation between the prices and flows with neighbouring countries in the Central Western Europe region. We will discuss the price spreads and non-intuitive flows, the role of flow-based market coupling and how this could change with the upcoming developments in the neighbouring regions. The role of intraday markets in terms of the flows, volumes, prices and trends is also discussed.

The Day-ahead market, which is the largest wholesale short-term electricity market in Europe. The gate-closure for this market is 12:00 CET where all the bids, offers are sent in along with the transmission capacities or parameters. The results are determined per quarter since 1st October 2025 using the EUPHEMIA algorithm.

Based on the capacity calculation and allocation methodologies in different interconnected regions, the relevant inputs are sent to EUPHEMIA from all across the European countries that are coupled through the Single Day-ahead Coupling (SDAC) algorithm.

Some examples of the capacity calculation regions (CCR) are Nordics and CORE (Austria, Belgium, France, Germany, Hungary, Croatia, Czech Republic, Luxembourg, Netherlands, Poland, Romania, Slovakia, Slovenia) which operate on the Flow-based market coupling (FBMC) principles. In the Nordics, FBMC was introduced in Oct 2024 and has been operational for much longer in the CORE region. However, there are differences in how the principles are applied. There is a new update coming up in the CORE FBMC which will affect how the borders beyond the CORE region are modelled. This will impact the capacity calculation and allocation towards Nordics.

Under the current Standard Hybrid Coupling (SHC) in the CORE region, grid capacity used by predicted trades with neighboring (non-flow-based) regions is reserved in advance. Advanced Hybrid Coupling (AHC) changes this. Instead of giving priority to trades across these borders, it models their impact directly in the flow-based domain using virtual bidding zones. These virtual zones represent how external trades affect internal grid constraints, allowing all trades to compete on equal terms in the market coupling. Fig. 1 illustrates how the FBMC domain of the CORE region will be expanded once AHC goes live in Q2 2026. While this article is not necessarily about AHC and SHC but at least uses a bit of its flavour to set the stage for the discussion on flows and price formations.

Hub to hub for DK1-NO2 at H-8 in import and export directions from Jan’24 to July’25. — Fig. 1 Glimpse of the FBMC domain additions in CORE after the go-live of AHC.:

When the Nordics went live with FBMC, AHC was already adopted, which means going all in with every cross-border HVDC line having a connection with a country beyond Nordic CCR was also modelled as a virtual hub. This meant that the FBMC domain was much larger than the count of the number of bidding zones in the Nordics.

The upcoming change will clarify how the DA price formations and flows will be impacted and what will it mean for the ID trading. For now, it is interesting to first start with analysing how has the past year been in these aspects considering the go-live of Nordic FBMC and the continued SHC operational in the Core region.

Day-ahead price formations and correlations

The heatmaps for the Day-ahead prices in DK1 and DK2 over 2025 can be found in Fig. 2. The week of the year and the hour of the day are considered while plotting these correlating heatmaps. As a general observation, the prices in the morning and evening peak hours have been higher than the off-peak hours and the pattern is consistent across the year. The weeks during spring/summer/autumn see lower prices in the solar hours. The sharp rise in the prices in the evening hours is predominantly visible during a few weeks in summer and autumn.

Fig. 2.1. Heatmaps for Day-ahead prices in DK1 and DK2 during 2025.:

Fig. 2.2. Heatmaps for Day-ahead prices in DK1 and DK2 during 2025.:

The correlation in the Day-ahead prices from Jan 2025 until Feb 2026 for DK1-DE, DK1-NL, DK2-DE, SE4-DE is plotted in the Fig. 3. On comparing, one can see a clear correlation between the prices in between some countries and bidding zones. DK1 prices are highly correlated with DE with some outliers. Comparatively, DK1-NL also shows a similar pattern but with more outliers which might not exactly fit on the slope.

We find a cluster of data points stacked where the DK1 prices are lower than 100 Euros/MWh whereas DE and NL prices are close to or above 100 Euros/MWh. In such cases, it makes us investigate further how were the DA flows scheduled in these instances.

Daily count (sum of limiting CNEC hours) per bidding zone pair in July 2025. — Fig. 3 Scatter plots showing correlation in the Day-ahead prices from Jan 2025 until Feb 2026 for DK1-DE, DK1-NL, DK2-DE, SE4-DE.:

Scheduled Day-ahead flows and price spreads

The resulting spreads between DK1-NL and DK1-DE based on the data collected from Jan 2025 to Feb 2026 are investigated in this section. The scheduled DA flows along with the DA spreads are plotted in Fig. 4 and Fig. 5 for DK1-NL and DK1-DE respectively. From these figures, we can observe that there are several instances when the spreads are negative that means DK1 is lower priced than NL and DE and the DA scheduled flows indicate an import towards DK1 from NL (when scheduled flows are positive, the second quadrant).

Border wise limiting CNEC counts per hour for NO5 on 13th July 2025. — Fig. 4 Day-Ahead price differences between DK1-NL and Scheduled DA flows:

Hub to hub capacities for NO5-NO1 and NO5-NO2 at H-8 in import and export directions from 1st July’25 to 18th July’25. — Fig. 5 Day-Ahead price differences between DK1-DE and Scheduled DA flows:

It is 26% of the time during this period when DK1 prices were below both NL and DE. These periods are referred to as filtered periods in this article henceforth. Furthermore, we observed 7.07% of the total time when the scheduled DA flows was in the import direction from NL to DK1 and export to DE when the DK1 prices were below DE and NL both.

Sequential intraday capacity updates with IDCC as applied in the Core region. — Fig. 6 Day-Ahead price differences between DK1-DE and Scheduled DA flows:

The DA price differences between DK1-NL and DK1-DE and the corresponding scheduled DA flows for the filtered periods are shown in Fig. 6. The imports from NL for these time instances have sometimes even reached the maximum limit allowed while DK1 is lower priced than NL. The exports towards DE from DK1 have also reached up to 2500 MW for the same periods. Some of these flows are also using DK1 as the intermediate corridor to send flows from NL to DE. We take an example from January 2025 to explain this further.

Fig. 7 shows the example from 28th Jan 2025 when the DA prices in DK1, DE, and NL were 57.45, 98.22, and 77.82 Eur/MWh respectively. The DA flows were scheduled from NL-DE was 1206 MW for the hour at 6:00 CET, whereas for NL to DK1, it was 700 MW which was flowing to DE through DK1. The active Constrained Network Element and Contingency (CNEC) in DK1, “ACLineSegment (ZBR) ENDK DK1 E_KAE-STSV Z1 F Terminal: F” with the shadow price of 266.8 Eur/MWh indicated that the DK1-CO (HVDC with NL) hub would have a relieving effect given the Power Transfer Distribution Factor (PTDF) shown in Fig. 7. More information on the Urgent Market Message for ASR_400_REV that caused this limitation can be found here Nord Pool - UMM Platform.

Looking at the nodal level prices which are displayed in the lower chart, we see the DK1-CO and DK1-DE prices are higher than in DK1 and NL. Therefore, the seemingly non-intuitive flows from NL to DK1 are in fact not non-intuitive as they pass through DK1-CO.

Belgium to Germany intraday capacities in IDCC(a), IDCC(b) and IDCC(c). — Fig. 7 Example of Nordic FBMC domain with CNECs and PTDFs and price differences between bidding zones on 28th Jan 2025. (Source: Montel SysPower):

Intraday flows and fundamentals

For several of the time instances amongst the filtered periods, observing Fig. 8, we see the Intraday flows to be in the opposite direction of the DA scheduled flows for both the combinations in this analysis. The DK1-DE flows were in the import direction towards DK1 while the DA flows were in the export direction. The DK1-NL intraday flows are in the export direction for DK1 in most cases which is again the reverse of the DA scheduled flows. Also, the magnitude in January and February 2025 is remarkable since in some cases it even exceeds the DA scheduled flows. Fig. 9 shows the wind generation in DK1 and DK1-NL intraday flows during filtered periods. We zoom in to the first couple of months of 2025 for the next part of this analysis.

SE4 EPEX import-export volumes from 25th Dec’23 to 6th Aug’25. — Fig. 8 Intraday flows between DK1-DE and DK1-NL for the filtered periods.:

SE3 EPEX import-export volumes from 25th Dec’23 to 6th Aug’25. — Fig. 9 Wind generation in DK1 and DK1-NL intraday flows during filtered periods.:

Based on the average intraday traded prices for each delivery product within the filtered periods in Jan and Feb 2025, the price differences are calculated and displayed in Fig. 10. These are illustrated along with the intraday flows between the two combinations in focus. The corresponding fuel mix of DK1 is shown in Fig. 11. The instances when we observe higher exports, reaching around 1000 MW, in the intraday market towards NL, it is accompanied with massive wind generation spikes in DK1.
Connecting the direction of flows, we see that the DA pattern of flows from NL to DK1 where DK1 was lower priced got reversed in direction in the intraday markets.

Fig. 10 Intraday average price spreads and flows between DK1-NL, DK1-DE in filtered periods from Jan, Feb 2025.:

Fig. 11 Fuel mix of DK1 from 8th January to 21st February 2025. (Source: Montel EnAppSys):

Fig. 12 Counter trading between DK1-DE from Jan to Feb 2025. (Source: Montel EnAppSys):

The countertraded volumes between DK1-DE are shown in Fig. 12 where the blue area of the volumes are flowing into DK1 from DE for countertrading. It is done through the Intraday market. So, connecting the Fig. 10 and Fig. 12, we can correlate the connection between the large volumes coming in from DE to DK1 on certain days.

The connection in this analysis also helps us better understand the flows towards NL from DK1 in the intraday market especially those ones where the volumes are even larger than day-ahead scheduled for DK1-NL.

Hub to hub for DK2-SE4 at H-8 in import and export directions from Jan’24 to July’25. — Fig. 13 DK1 Hub-to-hub capacities with DE and NL (Note: these are the capacities remaining after gate-closure of Intraday market. Positive values in this plot indicate import capacities towards DK1.). (Source: Montel EnAppSys):

Fig. 13 Displays the Hub-to-hub capacities for DK1 with DE and NL. These capacities are the ones left after the continuous Intraday market has closed. The time instances when DK1 is scheduled to net export to NL in ID flows, we rarely see any further Hub-to-hub capacities remaining at the real-time. The resulting values seen in this plot are a combination of released capacities in the intraday and the trades that used up the capacities.

It will be interesting to follow how this flow and price pattern will be impacted when the Advanced hybrid coupling goes live in the Core CCR which is scheduled for Q2 2026. As from the CORE CCR point of view, DK1 or DK1-CO is not counted yet in FBMC domain.

Overall take on Intraday volumes traded in Denmark

After the introduction of the cross-border quarterly products in the Nordics since March 2025, we have seen the product to get increasingly popular in Denmark as can be verified in Fig. 14 for DK1.

As of for the intraday market capacities which have struggled after the go-live of Nordic FBMC, it is natural to wonder whether we will face a similar situation when more DA capacities are offered through AHC in CORE FBMC towards Nordics. As a ray of hope, the CORE region already has a system in place to create new FBMC domains during intraday with updated information. Currently, three of these stages are already live, IDCC (a), IDCC (b), and IDCC (c). Out of these three, IDCC (b) and IDCC (c) are where new FBMC domains are calculated to determine new capacities that will be allocated to the market. More details can be found here. Fig. 16

Summary

This article sheds light on the past year for the Danish short-term market with Day-ahead market in focus. The price formations and flows in and out of the Danish bidding zones are a function of not just the fundamentals within the bidding zones but also of the neighbouring countries and the interconnectors. Thereby, the seemingly non-intuitive flows are discussed and the impact of countertrading between DK1-DE in the intraday markets and the flow reversal towards the Netherlands is observed. Whilst discussing the day-ahead and intraday flows after the post- Nordic FBMC era, it is interesting to touch upon the topic of Advanced hybrid coupling which will soon be implemented in the CORE FBMC. It will impact the way flows are allocated on the borders towards Nordics as the HVDCs will be included as virtual hubs in the FBMC domain of the CORE CCR. Thereby how it will impact the DA flows and capacities allocated to intraday markets and the price formation will be a topic of interest which we aim to monitor closely in the future.