June 11, 2026

Day-ahead nomination: How Covolt Avoids Imbalance Charges and Turns Them into Returns

Joris van der Heijden

Published by

Joris van der Heijden

Covolt Netherlands

If you own solar panels and/or a battery system that feeds energy back into the grid, sooner or later you’ll come across terms like nomination, curtailment, and imbalance trading. They sound technical, but they all revolve around the same central question: how do you ensure that your system generates as much energy as possible without causing problems for the grid?

Covolt makes an estimated 9 million operational and business decisions every day for more than 900 facilities in the Netherlands and Belgium.

Covolt manages this entire process for you—automatically, continuously, and based on current market conditions. This article explains what each term means, how they relate to one another, and what Covolt actually does with them.

The basic premise: the power grid requires balance

The power grid operates on the principle of a balance between supply and demand. At any given moment, the amount of energy generated must exactly match consumption. If supply exceeds demand—or vice versa—an imbalance occurs. That imbalance disrupts the grid frequency and incurs costs. Renewable energy producers are therefore required to declare in advance how much they expect to generate, so that the grid operator TenneT (or Elia in Belgium) can adjust the grid accordingly. That’s where nomination comes into play.

Step 1 — Nominations: expected the day before

What is it?
Every day, Covolt reports on your behalf, for each connection and every 15-minute interval, how much electricity your location is expected to feed back into the grid and consume the following day. The sum of these figures constitutes the nomination and is sent to your energy supplier.

How does Covolt calculate this?
Covolt’s system combines weather forecasts, historical measurement data from your location, and the technical profile of your assets to generate the most accurate forecast possible. The more precise the nomination, the less imbalance there will be later on.

What if the forecast is wrong?
Weather conditions, among other things, can never be predicted with complete accuracy. A cloudy or foggy day that was forecast to be sunny, or snow on the panels: these can lead to a discrepancy between what you reported and your actual feed-in and consumption. This discrepancy is called an imbalance, and it has financial consequences.

Step 2 — Curtailment: making adjustments on the day itself

What is it? Curtailment means intentionally reducing the energy production of your system. The Covolt Control Box instructs your PV inverters to temporarily produce less or no energy at all. When does Covolt apply curtailment? There are two situations: 1. Mandatory curtailment — The grid operator indicates that your connection can temporarily feed less power back into the grid, for example, due to grid congestion in your region. In that case, curtailment is a legal requirement. This is typically done through a Capacity Management Contract (CSC). You will receive compensation from the grid operator for this. 2. Strategic curtailment — Covolt decides to reduce your production slightly or completely because market conditions make it advantageous to do so. For example, if the imbalance price at that moment is so low (or negative) that producing and feeding power back into the grid costs you money instead of generating revenue. In doing so, we take many variables into account, including the Renewable Energy Subsidy (SDE). How does this affect you? You can see this management in the Covolt myHorizon app, including the times when curtailment was applied and why.

Step 3 — Smart Management of Imbalances: Profiting from Market Price Differences

What is it?
Smart imbalance trading involves actively responding to price differences in the imbalance market. TenneT publishes an imbalance price every fifteen minutes: it is high when there is too little power on the grid, and low (or even negative) when there is too much.

How does Covolt use this?
By intelligently predicting when the imbalance price will be favorable, Covolt can intentionally have your system produce slightly more or less than the nomination specifies. Such a deliberate deviation generates additional revenue on the imbalance market. This is therefore not an error that needs to be corrected, but an opportunity that is actively exploited. Batteries are also utilized in this imbalance market. They charge at low, often negative prices and discharge at high prices. The difference between these is called the “spread” and constitutes (part of) the battery’s revenue model.

What is the difference between this and the nomination?
The nomination is the forecast you submit in advance. Imbalance trading is what is done with that deviation on the day itself. Covolt manages both: making the nomination as accurate as possible and leveraging the inevitable deviations as profitably as possible.

Control Status 2
Within this context, we must take Control Status 2 into account. This refers to a situation in the energy grid’s imbalance market. This situation occurs when the balance between supply and demand shifts from a deficit to a surplus—or vice versa—within a single 15-minute period. This has consequences. In Control Status 2, TenneT settles accounts with all parties that deviate from their submitted nominations, regardless of whether they contribute to the problem or not. The share of Control Status 2 has grown from 17% in 2024 to an expected 40% in 2026. This represents strong growth that also impacts the earnings from imbalance management.

Covolt takes control status 2 into account when managing both solar power and batteries. We predict whether this situation will occur. This helps us prevent unwanted costs for customers.

The three instruments at a glance

Nominate Curtailment Imbalance trading
Timing The day before Real-time Real-time
What is it? Report expected production to the supplier Reducing production in the event of unfavorable prices or grid congestion Trade electricity to address shortages or surpluses
Purpose Limiting imbalance costs Avoiding Costs or Resolving Congestion Additional revenue through the imbalance market
Reimbursement Cost savings Sometimes through the network operator's CSC Revenue from the imbalance price
Covolt handles it ✅ Automatic, daily ✅ In real time via Stuurbox ✅ Continuously via trading algorithms
  Timing What it is Purpose
Nominate The day before Report expected production to the supplier Comply with requirements, limit imbalance costs
Curtailment Real-time Reduce production Preventing network congestion or optimizing strategic returns
Imbalance trading Real-time Trade electricity to address shortages or surpluses Generate additional revenue through the imbalance market

How Covolt takes care of this for you

All three tools are integrated into Covolt’s day-to-day operations as an aggregator. You don’t have to do anything yourself:

  • Covolt automatically submits your nomination to your energy provider every day.
  • The Covolt Control Box at your site executes real-time control instructions, including curtailment.
  • Covolt’s trading algorithms continuously monitor the imbalance market and make adjustments where it yields a return.
  • Using the Covolt myHorizon app, you can see what has been nominated, when curtailment has been applied, and what revenue the imbalance trading has generated.

Good to know

Nominations, curtailment, and imbalance trading are part of Covolt’s Aggregator Services—the services we use to maximize the financial return on your installation. They work seamlessly with our Asset Monitoring Services, which ensure technical performance.

Learn more?

Please contact us—we'd be happy to explain it to you!
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Frequently Asked Questions About Curtailment and Imbalance Trading

Curtailment is the deliberate reduction of energy production from a solar power system. This occurs when energy prices are negative—meaning that feeding electricity back into the grid costs money—or during grid congestion, when the grid operator requests that less power be fed into the grid.

Mandatory curtailment is imposed by the grid operator through a Capacity Management Contract (CSC) in the event of grid congestion. You will receive compensation for this. Covolt decides on strategic curtailment itself based on market conditions: if the market price is so low or negative that feeding power into the grid costs you money instead of generating revenue.

Control State 2 occurs when TenneT activates both upward and downward control capacity within the same quarter-hour to maintain the balance of the power system. In this situation, different imbalance prices may apply to a deficit and a surplus.

Covolt uses real-time TenneT data, including the Balance Delta and estimated imbalance prices, to identify such situations early on. For solar installations, Covolt can proactively reduce output when an impending imbalance could lead to high costs. For battery systems, Covolt can also offer active power on the aFRR market; when such a bid is activated by TenneT, the battery can actually generate revenue by helping to restore the system balance.