Surreal illustration of the European electricity grid with data visualizations representing market uncertainty.

Decoding Europe's Electricity Future: How Advanced Modeling Tackles Market Uncertainty

Beau Callahan in Business & Economy December 2025 • 4 min read.

"Navigate the complexities of short-term electricity markets with ATLAS, a cutting-edge model designed to optimize energy processes under unpredictable conditions."

The European electricity market is a complex web of supply, demand, and intricate regulations. Ensuring a stable and efficient energy system requires careful planning and adaptability, especially when facing unpredictable factors. To navigate these challenges, energy experts are turning to advanced modeling tools that can simulate market dynamics and optimize resource allocation.

One such tool is ATLAS, a sophisticated model developed by RTE, France's transmission system operator. ATLAS is designed to simulate the short-term operations of European electricity markets, taking into account various uncertainties and constraints. Originally developed during the Optimate project, ATLAS has evolved into a critical asset for understanding and managing the complexities of the energy landscape.

ATLAS realistically simulates short-term processes through specific axes: agent behavior, operational constrains and uncertainty evolution in order to aid design choices in short-term electricity markets; understand the consequences of forecast error and strategic behavior on different market phases (for instance in terms of scarcity, market prices, revenue and risk etc.).

ATLAS: A Comprehensive Approach to Electricity Market Simulation

Surreal illustration of the European electricity grid with data visualizations representing market uncertainty.

ATLAS models the chain of electricity markets in order to realistically reflect supply-demand balancing processes. It is built upon three specific axes:

The ability of ATLAS to realistically mimic the short-term dynamics of electricity markets stems from its robust structure. It consists of several modules working together in a cohesive chain.

Agent Behavior: Simulates the actions of various market participants, such as power plants, consumers, and grid operators. Each participant is represented by optimization problems and heurisitc models, allowing for an analysis of strategic decision-making.
Uncertainty Evolution: Accounts for fluctuations in renewable energy sources, demand patterns, and other market variables. This axis incorporates forecast matrices to manage uncertainties across different time frames, improving the model's accuracy.
Operational Constraints: Models the technical limitations of the grid and power plants. Includes transmission capacities and generator constraints, ensuring that the simulated market outcomes are physically feasible.

The framework is designed to assess the impacts of strategic behaviour, forecast errors, system constraints, as well as many external data for the generation forecast (VRE) such as wind and solar and price forecast

Powering the Future with Precision and Insight

As Europe continues to transition towards a cleaner and more sustainable energy system, tools like ATLAS will become increasingly essential. By providing a detailed and data-driven approach to understanding electricity market dynamics, ATLAS empowers stakeholders to make informed decisions, navigate uncertainty, and ultimately build a more resilient and efficient energy future for the continent.

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This article is based on research published under:

DOI-LINK: https://doi.org/10.48550/arXiv.2402.12848,

Title: Atlas: A Model Of Short-Term European Electricity Market Processes Under Uncertainty

Subject: econ.gn math.oc q-fin.ec

Authors: Emily Little, Florent Cogen, Quentin Bustarret, Virginie Dussartre, Maxime Lâasri, Gabriel Kasmi, Marie Girod, Frederic Bienvenu, Maxime Fortin, Jean-Yves Bourmaud

Published: 20-02-2024

Everything You Need To Know

What is ATLAS and why was it developed?

ATLAS is a sophisticated model developed by RTE, France's transmission system operator, designed to simulate the short-term operations of European electricity markets. It was created to help navigate the complexities of supply, demand, and regulations within the energy system, especially when facing unpredictable factors. It realistically simulates short-term processes to aid design choices, understand the consequences of forecast errors and strategic behavior on different market phases, such as scarcity and market prices. ATLAS evolved from the Optimate project to become a critical tool for managing the energy landscape's uncertainties and ensuring a stable energy future.

How does ATLAS simulate electricity market dynamics?

ATLAS realistically simulates short-term processes through specific axes: agent behavior, operational constraints, and uncertainty evolution to aid design choices in short-term electricity markets. It's built upon three specific axes: agent behavior, uncertainty evolution, and operational constraints. Agent Behavior simulates the actions of market participants such as power plants and consumers through optimization problems and heuristic models. Uncertainty Evolution accounts for fluctuations in renewable energy sources and demand patterns by incorporating forecast matrices. Operational Constraints model the technical limitations of the grid and power plants, including transmission capacities and generator constraints, ensuring the simulated market outcomes are physically feasible.

What are the key components of the ATLAS model, and how do they work together?

ATLAS realistically simulates short-term processes through specific axes: agent behavior, operational constraints, and uncertainty evolution. These components work together cohesively in a chain to realistically reflect supply-demand balancing processes. Agent Behavior simulates market participants, Uncertainty Evolution manages fluctuations with forecast matrices, and Operational Constraints model technical grid limitations. This framework assesses the impacts of strategic behavior, forecast errors, and system constraints using external data for generation and price forecasts.

How does ATLAS handle the uncertainty associated with renewable energy sources like wind and solar?

ATLAS incorporates an 'Uncertainty Evolution' axis that accounts for fluctuations in renewable energy sources, such as wind and solar. This axis uses forecast matrices to manage uncertainties across different time frames. By accounting for variations in renewable energy output, ATLAS improves its accuracy in simulating market outcomes and provides a more realistic view of the energy landscape. This is important for making informed decisions in the face of unpredictable weather patterns and changing energy demands.

What impact can tools like ATLAS have on Europe's energy future?

Tools like ATLAS are essential as Europe transitions to a cleaner and more sustainable energy system. By providing a detailed and data-driven approach to understanding electricity market dynamics, ATLAS empowers stakeholders to make informed decisions and navigate uncertainty. This enables the development of a more resilient and efficient energy future for the continent, supporting the integration of renewable energy sources and ensuring a stable and reliable electricity supply. Without the ability to model and understand these complex interactions and constraints, it is more difficult to predict outcomes.