This publication aims to provide a better understanding of the adequacy challenges and market design discussion in France and Germany. It describes in depth different proposals currently on the table, and it specifically discusses the consequences of a unilateral implementation of a decentralized capacity market in France for the French and German electricity markets, as well as its cross-border effects. The deeper, underlying question of this paper is to what extent cross-border differences in capacity remuneration matter for the functionality of an internal European electricity market.
