The European Council (EC) has agreed a new position on the internal electricity market, placing consumer empowerment, cross-border trading and higher levels of renewables at the heart of the European Union’s efforts to transition to a low carbon economy.
Yesterday the EC reached a general approach on three key areas of the internal market that will be put forward to the European Parliament at the beginning of 2018 – creation of a modern electricity market; establishment of a more competitive and consumer-oriented internal electricity market; and promotion of renewable energy use.
‘The cornerstone of the redesign of the electricity market’
The council’s agreed negotiating position on establishing the framework for an internal electricity market across the EU sets out how it intends to ensure a ‘well-functioning, competitive and undistorted electricity market’ with the aim of enhancing flexibility, decarbonisation and innovation.
This is intended to help the EU transition toward a low carbon system and economy and meet the Energy Union’s objectives such as the 2030 climate and energy framework.
New rules will be introduced to allow for electricity trading within differing timeframes, with an aim to bring trading closer to real-time. This is intended to allow a higher share of renewable production in the EU’s energy systems, while new rules on dispatching and balancing responsibility will limit the distortions on the market.
Electricity trading areas known as ‘bidding zones’ are to be more clearly defined as areas in which market participants are able to exchange energy without capacity allocation. These are intended to maximise cross-border trading and maintain security of supply across the region.
The Commission’s proposal requires maximum capacity to be allocated to the market participants on the border of a bidding zone. A benchmark level of maximum capacity is established on the border and must be respected, with countries below that level required to start implementing remedial actions or reconfigure the bidding zones. The Commission would be given the opportunity to intervene if the benchmark has not been met by a pre-disclosed deadline.
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